NATURAL GAS (LNG) - Vaasanseutu.fivaasanseutu.fi/app/uploads/sites/7/2016/03/Kenneth-Engblom.pdfreal alternative to Liquid Natural Gas (LNG)? ... Mini LNG liquefaction & Small LNG

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LIQUID NATURAL GAS (LNG)VS.

LIQUID BIO GAS (LBG)

Vaasa EnergyWeek 14.3.2016

Kenneth EngblomDirector , Business DevelopmentLNG InfrastructureWärtsila

3/14/2016 Vaasa Energy Week- LNG vs. LBG / Kenneth Engblom1

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AGENDA

AGENDA

WÄRTSILÄ AT A GLANCELNGLBGLNG VS LBGCONCLUSION

14.03.2016 Vaasa Energy Week- LNG vs. LBG / Kenneth Engblom

Wärtsilä is a world leader in large diesel and gas engines for power plants and ships.

The technology is also prepared for renewable fuel in gas or liquid form.

When will renewable fuel be the number one choice, how to make Liquid Bio Gas (LBG) the

real alternative to Liquid Natural Gas (LNG)?

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WÄRTSILÄ CORPORATION

EFFICIENCY FLEXIBILITY ENVIRONMENTAL

SOLUTIONS

LE

AD

ER

IN

SOLUTIONS FOR

Marine/

Offshore

Power

Generation

Marine

Solutions

34%

Energy

Solutions

22%

Services

43%

Listed in Helsinki

5,0 billion €

turnover

Net sales

by business

2015

18,900 Professionals


© Wärtsilä .

WÄRTSILÄ LNG SOLUTIONS

ON

SH

OR

EO

FF

SH

OR

EL

IFE

CY

CL

E

Small LNG liquefaction plants Mini LNG liquefaction &

Bio Gas liquefaction plantsSmall/Medium LNG terminals

LNG satellite & bunkering

terminalsLNG storage & regasification

barge

LNG regasification BOG reliquefaction Cargo Handling System

Gas and LNG Carriers

Fuel gas handling system Ship and Cargo Tank design

Lifecycle services Start–up supportProduct and technical support Spares


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WÄRTSILÄ CORPORATION


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AGENDA

WÄRTSILÄ AT A GLANCE

LNG (Liquid Natural Gas)

LBG (Liquid Bio Gas)

LNG vs. LBG

CONCLUSION

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NATURAL GAS AS LNG IS CONQUERING NEW MARKETS

By 2035 LNG will have overtaken pipelines as the dominant form of traded gas – BP Energy Outlook 2035

Global interest in LNG is driven by

• Energy security and lower energy costs

• Sustainability and emission reduction

in power generation and shipping

• Perfect balancing fuel for intermittent

renewable power generation and

escalating demand fluctuation.


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LNG CONSUMERS

Typical consumers:

• Power generation

• Baseload & peaking power plants

• Energy intensive industries

• Mines & Drilling rigs

• Metal processing plants

• Petrochemical plants

• Manufacturing plants, e.g. fertilizer, cement, gypsum boards, glass, chemicals

• Gas driven transportation

• Ships

• Trucks

• Domestic gas consumption

• Cooking & heating


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NATURAL GAS - RESOURCES


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LARGE SCALE LNG- HOW IT USED TO BE!


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SMALL SCALE LNG- THE FUTURE ADITION!

VAASA


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”Providing the only source of gas for industries in Northern Finland.”

TORNIO- FINLAND

Tornio Manga LNGCustomer Manga LNG Oy

Type Small/Mid scale terminal

Tank net volume 50,000 m3

Send out Max 40 tonnes per hour at 6.0 barg

Scope of supply • Civil works and infrastructure

• Full containment storage tank

• Regasification & gas metering

• BOG system

• Electrical and control system

• Unloading system

• Bunkering and Truck loading

Delivery method EPC Turnkey

Delivered 2018


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“The first stand-alone small scale LNG plant in Northern Europe.”

KARMØY, NORWAY

SnurrevardenCustomer Gasnor

Type Small scale liquefaction plant

Tank net volume 2 x 250 m3

Capacity 60 TPD / 22,000 TPA

Size of

liquefaction unit

16 m x 18 m

Gas source Pipeline gas. Inlet pressure

120-150 bar.

Details • LNG transported to customers by

tanker truck

Scope

of supply

Complete plant, incl.

• Gas pre-treatment

• Cooling system (Ambient air)

• Reversed Brayton liquefaction

process

• Storage tanks

• Electrical and control systems

• Truck loading system

• Gas engine

Excl. Substructures

Delivery method EPCIC

Delivered 2003


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“Twice the capacity,half the footprint!”

BERGEN, NORWAY

Kollsnes IICustomer Gasnor

Type Small scale liquefaction plant

Tank net volume 4,000 m3


Size of

liquefaction unit

12 m x 38 m

Gas source Pipeline gas. Inlet pressure typically

70 bar.

Details Extension to Kollsnes I. Includes two

truck loading stations and existing

loading jetty for small LNG carriers.

Scope

of supply



• Cooling system (Seawater)

• Double Reversed Brayton

liquefaction process

• Storage tank


• Civil works


Delivered 2007


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PORVOO, FINLAND

“LIN consumption reduced by 60% compared to old liquefaction plant.”

Gasum KilpilahtiCustomer Gasum

Type Mini liquefaction plant

Tank net volume 3 x 683 m3


Size of

liquefaction unit

16 m x 20 m

Gas source Pipeline gas

Details • Utilization of excess nitrogen

from adjacent oxygen plant.

• No rotating machinery

Scope

of supply

• Pre-treatment

• LIN liquefaction process

• Storage tanks

Excl. substructures


Delivered 2010


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OSLO, NORWAY

“135 Oslo region buses will be able to run on biogas which means 10,000 tonnes emission reduction per year.”

EGE BiogasCustomer Cambi AS

Type Mini liquefaction plant

Tank net volume 180 m3


Size of

liquefaction unit

8 m x 14 m

Gas source Biogas from 50,000 TPA of food

waste

Details Fuel production for 135 buses in

the city of Oslo

Scope

of supply



• Cooling system (Ambient air)

• MR liquefaction process

• Storage tank


• Service agreement

Excl. Civil works and installation

Delivery method EPC

Delivered 2013


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EGE BIOGAS- OSLO, NORWAY


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AGENDA




LNG vs. LBG

CONCLUSION

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BIO GAS - FEEDSTOCK


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BIO GAS – ANNUAL POTENTIAL

Finland total energy

consumption:

380 000 GWh

Botnia region:(Västerbotten, Västernorrland, Ostrobothnia)

Potential: >1200 GWh

In use: >180 GWh( 12 plants )

Finland*:Potential: 7 - 17000 GWh

In use: >900 GWh (>82 plants)

End use: 455 GWh Heat

160 GWh El

35 GWh Fuel

740 000 GWh

Source : Johan Saarela, Stormossen , Ari Lampinen http://www.cbg100.net/products/finnish-biogas-statistics-2013-2014/ & European BioGas Association

* Based on assumptions from 2013

EU :Potential: 740 000 GWh

In Use: 133 000 GWh (>18000 plants)

Of which

BioMethane: 24 000 GWh Fuel

(367 plants)


http://www.cbg100.net/products/finnish-biogas-statistics-2013-2014/?utm_source=copy&utm_medium=paste&utm_campaign=copypaste&utm_content=http://www.cbg100.net/products/finnish-biogas-statistics-2013-2014/

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BIO GAS PLANTS NEARBY

Stormossen

Gas Output: 16 GWh (=1,8MW)

Jeppo BiogasGas production: ~ 21 GWh / a ( =2,4 MW)

Lakeuden Etappi

Gas production: ~16 GWh / a (= 1,8 MW)

Laihia Biogas

Gas production: >2 GWh / a ( = 0,2 MW)

Total Capacity within 100km radius

55 GWh (6.2 MW)

Under planning!

Biovakka, Lapua52 GWh (=6 MW)


Honkajoki Biogas

Gas production: >36 GWh / a ( = 4 MW)

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AGENDA




LNG vs. LBG

CONCLUSION

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LOW OIL PRICE - THE COMMON CHALLENGE FOR LNG AND LBG

Light Fuel Oil

LNG


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INCREASING THE VALUE OF BIOGAS

Investment:

+9M€

3 M€

+5 M€

50GWh/year

Bio Gas plant.

Raw material

processing

Gasification or

Anaerobic digestion

Gas Upgrading

Compression (CBG)

Liquefaction

(LBG)

or

+1,5 M€

+5 M€

Value of Biogas

n.a

Flare: 0 M€

Heat: 5- 15 €/MWh

El: 38% of 30-35 €/MWh (With Feed in 83,5€ / MWh) 12€/MWh or 32€/MWh

or

Same as above, slightly better el. efficiency

CNG: 1,25€/kg- Without ALV 1,01€/kg – Duty (0,21€/kg) = 0,80 €/ kg = 59€ / MWh

CBG: 1,45€/kg - Without ALV 1,17€/kg = 86€ / MWh

LBG >>86 €/MWh


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LBG PLANT INVESTMENT AND PRODUCTION COST

GWh / Year

Inve

stm

en

t (M

€)

& P

rod

uc

tio

n C

os

t (€

/MW

h)

0 4010 20 30 Tonne LBG / day

0 8000020000 6000040000 m3 raw gas / day

0205 1510 MW (gas energy)

ASSUMPTIONS: 30 % Investment support, 6,5% WACC, Feedstock delivered free of charge to plant, approx. 1/3 of Income from digestate

Ideal size for LBG Production

30- 130 GWh Plant Size

Plant Size

CBG (ALV0%) Sales

price in Finland

Typical max size for

Biomass collection &

distrubution of digetsate

Recommended

size by ELY


Wärtsilä

Large LBG

Wärtsilä

Small LBG

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FUEL - SALES PRICE AND COSTS

GWh / Year

Inve

stm

en

t (M

€)

& P

rod

uc

tio

n C

os

t (€

/MW

h)

0 4010 20 30 Tonne LBG / day

0 8000020000 6000040000 m3 raw gas / day


Natural Gas

Plant Size

CBG = 1,17 €/kg (with ALV 24% = 1.45 €/kg)Diesel

Ta

x

LFO(Polltoöljy)

Ta

xLogistics

Profit

CBG conv.

Ta

x

Gasoline

Ta

x

CNG

All prices without value added tax (ALV 0%)

LNG – Estimated landed price in FinlandHandling fee Handling fee

Handling fee


© Wärtsilä .

FUEL - SALES PRICE AND COSTS

GWh / Year

Inve

stm

en

t (M

€)

& P

rod

uc

tio

n C

os

t (€

/MW

h)

0 4010 20 30 Tonne LBG / day

0 8000020000 6000040000 m3 raw gas / day


Natural Gas

Plant Size

CBG = 1,17 €/kg (with ALV 24% = 1.45 €/kg)Diesel

Ta

x

LFO(Polltoöljy)

Ta

xLogistics

Profit

CBG conv.

Ta

x

Gasoline

Ta

x

CNG

All prices without value added tax (ALV 0%)

LNG – Estimated landed price in FinlandHandling fee Handling fee

Handling fee


© Wärtsilä .

AGENDA




LNG vs. LBG

CONCLUSION

© Wärtsilä .

LNG VS. LBG IN FINLAND

Today Natural Gas (and soon LNG) can be imported for a

fraction of the cost of domestic CBG or LBG production.

So why LBG ?

• Create jobs & potential new income for farmers

• Reduces fuel import

• Almost CO2 neutral

• The most efficient & environmental friendly biofuel

• Energy storage & potential off-taker for wind methane

Synergies between LNG and LBG

• LNG = LBG

• Building LNG infra will enable LBG production & consumption

• Both utilizing same infrastructure and consumers (Trucks, Marine

sector, Industry & Power plants)

• LNG is back-up to LBG and CBG/CNG

• LNG + LBG is a the ultimate low CO2 fuel mix.


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MAKING LBG MORE FEASIBLE

How to make LBG feasible?

LBG could be produced for < 60€/MWh with:

• Larger plants, > 40 GWh / year

• Co-operation/ Pipelines between neighboring bio gas plants

• Easier permitting of larger plant

• Finding valuable use for the digestate

• Choosing locations close to major agricultural and industrial waste

• Financial support for the biogas upgrading & liquefaction

• Further R&D to make small scale liquefaction plants more feasible

• Preparing the infrastructure & consumers for LNG, thereby enabling LBG


THANK YOU FOR LISTENING !

Please visit us at Wartsila.com or Energy Week -Stand B5

Documents

NATURAL GAS (LNG) - Vaasanseutu.fivaasanseutu.fi/app/uploads/sites/7/2016/03/Kenneth-Engblom.pdfreal alternative to Liquid Natural Gas (LNG)? ... Mini LNG liquefaction & Small LNG