The global consumption of natural gas has increased considerably in recent years. In 2012 it was 2,987 million tonnes of oil equivalent (mtoe) , compared with 1,768 mtoe in 1990. According to BP’s latest Energy Outlook, the consumption of natural gas is expected to reach 4,631 mtoe in 2035, as shown in Figure 1. By then, and for the first time ever, the consumption of natural gas will be as much as that of coal and oil – about 25 percent of global energy consumption.
The increased consumption of natural gas is mainly driven by lower price, as compared with other fuels, but also by its environmental footprint – the combustion of natural gas releases much less CO2 per energy unit than other fossil fuels.
As of today, about 90% of the gas produced worldwide is transported by pipeline from the gas field directly into the consumers’ location. In 2012, world production of natural gas was 3,364 billion cubic meters (bcm), of which about 70 percent was consumed within the country of origin. The remaining 30 percent was exported to other countries both through pipelines – 706 bcm – and shipped by sea – 328 bcm. Although the amount of natural gas transported by sea only accounts for 10 percent of world consumption, this is significant share of the natural gas traded between countries –, about 32 per cent.
In order to make the sea transport of natural gas effective, and therefore economically feasible, it needs to be converted into liquid, known as Liquefied Natural Gas (LNG). The liquefaction of natural gas is possible by lowering the temperature of the gas to –163oC. The cooling process occurs at complex liquefaction plants located at deep sea ports and connected to the gas fields by pipeline. Once in liquid state, the LNG is then transferred into an LNG carrier. In order to safely transport 180,000 m3 of gas at –163C across the ocean, LNG carriers have complex and unique systems – for example, cargo containment, cargo cooling, regasification, electrical propulsion, etc – that comprise a technologically advanced vessel.
On the other hand, these vessels are no longer expensive machines used to transport small parcels of gas that cannot be transported by pipeline. They are becoming an important part of the natural gas logistics chain. Consequently, LNG carriers are required to perform to very high standards of reliability so that the gas is delivered on time without compromising safety of life, the environment and the cargo.
Some LNG carriers are built for a specific trade, and are therefore designed for a very specific mission. However, the increased dynamics of this market, and the tendency for the commoditization of these vessels, suggests that flexibility is likely to become the most appreciated feature.