(EnergyAsia, April 21 2011, Thursday) — The small and mid-scale liquefied natural gas (LNG) market has grown considerably in recent years, with a number of new terminals starting up in 2010, and will gain even more popularity and importance in the near future, according to UK-based industry advisors, ActOn LNG consulting.

Tony Acton, principal of the Hampshire, England-headquartered firm, in a recent podcast interview by Pranay Shukla, editor of LNG OneWorld journal, said that the small to mid-scale LNG industry saw growth in 2010 with a number of new terminals starting up and several new projects sanctioned.

Mr Acton said that many organisations are now exploring the benefits and cost challenges of the new technology, as there are a variety of unique business cases and opportunities available when discussing small to mid-scale LNG.

“These projects have the potential to greatly increase the world take-up of LNG. Natural gas and LNG is an incredibly clean fuel and has carbon dioxide emissions some 30% less than oil. LNG also sells at a significant discount to most oil products.”

On the other hand, Mr Acton also recognised the challenge posed by rising cost:

“Projects with small throughputs have relatively big unit processing costs and therefore they can find it hard to compete with alternative fuels” such as diesel oil, heavy fuel oil or condensate oil.

“Good location is very important, particularly for import terminals where the marine facilities, the LNG storage and the infrastructure costs are all a big part of the total. New technology that can avoid expensive jetty trestles, such as hoses for LNG transfer or sub-sea LNG pipelines can certainly help.”

Mr Acton added that small and mid-scale LNG is still a growing area and new projects are emerging every day. He provided an outlook into the industry’s future:

“What you’re looking for is an isolated, high-value gas market, and I think these things can continue. There are many isolated markets that could benefit from small and mid-scale LNG. Some may be supplied by floating LNG re-gasification vessels, which are suitable for short and mid-term projects of say, two to five years. But the longer-term projects of up to 20 years probably need fixed facilities, provided we get the costs right.”

Presenting at Oil & Gas IQ’s Small-Mid Scale LNG Summit in Amsterdam, the Netherlands on April 11-12, Mr Acton spoke on exploring the parameters of small-mid scale production and regasification, various cost barriers and how they can be overcome, and examples of success so far and what could work in the future.

The Small-Mid Scale LNG Summit 2011 is focusing on the commercial and business case for smaller LNG projects and the technologies needed to make these happen. International case studies are being explored, along with updates from Vietnam, the Philippines, China, Turkey, Norway, France and the Netherlands.

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