Understanding LNG

LNG is natural gas that is stored and transported in liquid form at atmospheric pressure and at a temperature of -160°C. Like natural gas that is delivered by pipeline to customers, LNG consists mainly of methane (CH4).  Liquefying natural gas provides a means of moving it over long distances when pipeline transportation is not feasible.

Natural gas is turned into liquid using a refrigeration process in a liquefaction plant. The unit where LNG is produced is called a train.  Liquefying natural gas reduces its volume by a factor of 610, which makes it practical to transport and store the gas.

Generally, natural gas is measured in metric tonnes when it is in liquid form and in cubic feet when it is in gaseous state.  In international trade, LNG is transported in specially built tanks in double hulled ships to a receiving terminal, where it is stored in heavily insulated double-walled tanks.  The LNG is then sent to re-gasifiers which turn the liquid into its gaseous state for distribution via the pipeline system.   The LNG industry has operated worldwide for over 40 years with very few safety-related incidents.

Advantages and growth in use of LNG

Globally, natural gas production and consumption is growing rapidly to fuel power plants and to meet industrial, commercial and domestic needs.  The global market is  characterised by developed economies with well established markets importing piped gas and LNG, developing economies increasing the demand for natural gas, and few countries with large natural gas resources becoming stronger economically and fueling their development due to  higher natural gas prices.

Global demand for LNG has grown rapidly in recent years, particularly in the Asia Pacific region.  This can be attributed to the following main reasons:

1. Greater efficiency of gas-fired combined-cycle power plants than conventional oil-fired steam power plants.
2. Use as an alternative fuel source for energy diversification to reduce the dependence on imported oil.
3. Considerations of environment-friendliness
4. More supply, with major gas exporting countries such as Australia, Qatar, Russia, Nigeria and others expanding their liquefaction plants to meet the increasing demand from existing users and new buyers like China and India.