[ROCKMAN]

Looks like Russia is also trying to relieve some of its export income dependency from selling NG to the EU just as the EU is trying to figure out how to free itself from Russian NG:

Reuters - Russia's Rosneft was on track to start production at its first LNG gas plant in the country's Far East in 2018-2019. Rosneft reported its partnership with U.S. ExxonMobil for building the plant, which will have an initial annual capacity of 5 million tonnes. The project is fully targeting Asia-Pacific markets. The launch is planned for 2018-2019 said the state-controlled company, almost 20 percent owned by British oil major BP.

Rosneft said current LNG prices in Asia, at over $15 per MMBtu, would enable it to successfully carry out its LNG project. Russia is entering the global LNG game at a time when Qatar, Australia and others are boosting their presence on the market, and prices are being driven by growing demand in the Asia-Pacific region. Russia has only one LNG plant, which is controlled by state-run top natural gas producer, Gazprom, and is on the Pacific island of Sakhalin. It has an annual capacity of around 10 million tonnes.

[Tanada]

Is this related to the LNG Siberian Tanker port you were posting about the other day, or some additional unrelated project?

[ROCKMAN]

Nope: The Sakhalin-2 (Russian: Сахалин-2) project is an oil and gas development in Sakhalin Island, Russia. It includes development of the Piltun-Astokhskoye oil field and the Lunskoye natural gas field offshore Sakhalin Island in the Okhotsk Sea, and associated infrastructure onshore. The project is managed and operated by Sakhalin Energy Investment Company Ltd. (Sakhalin Energy). Sakhalin-2 includes the first liquefied natural gas plant in Russia. The development is situated in areas previously little touched by human activity, causing various groups to criticize the development activities and the impact they have on the local environment.

More here: http://en.wikipedia.org/wiki/Sakhalin-II. Yamal seems more oriented to the EU.

[Synapsid]

T, R,

Sakhalin is off the Pacific coast of Russia. Yamal is on the Kara Sea (Arctic Ocean.)

[ROCKMAN]

Syn - Correcto mundo. That's why it looks like the Yamal project is targeting EU buyers IMHO and Sakhalin going for Asian buyers. That seemed an obvious way to go even before Japan had their little nuke problem. And in addition to the Sakhalin LNG project do a search and you'll find a big refinery project being built on the Chinese border with Russia just down the coast from all that Sakhalin oil. The Chinese hunger for energy could not have come at a better time for the Russian developments in far eastern Siberia. Otherwise Russia might have had to sell a lot to the US. LOL.

[ROCKMAN]

More US LNG exports: What you may find interesting if you read the entire long article is they never ID who Endesa is or the destination of the LNG. But I found out: Endesa, S.A. is the largest electric utility company in Spain. They also operate in Chile. From: http://www.downstreamtoday.com/news/art ... a_id=42855

Cheniere Energy announced that its subsidiary, Corpus Christi Liquefaction, LLC ("CCL"), has entered into an LNG sale agreement with Endesa S.A. under which Endesa has agreed to purchase approximately 0.75 million tonnes per annum ("mtpa") of LNG upon the commencement of operations from the LNG export facility being developed near Corpus Christi, Texas. This agreement in addition to one previously signed under which Endesa will purchase approximately 1.5 mtpa of LNG, bringing the total quantity of LNG sold to Endesa under the two agreements to approximately 2.25 mtpa. Under the SPA, Endesa will purchase LNG on an FOB basis for a purchase price indexed to the monthly Henry Hub price plus a fixed component. LNG will be loaded onto Endesa's vessels. The contract has a term of twenty years commencing upon the date of first commercial delivery and an extension option of up to ten years. Deliveries are expected to occur as early as 2018.

[Synapsid]

ROCKMAN et al.,

Spain has a highly-developed pipeline system for NG some of which comes as LNG exports, so they're on top of Cheniere's plans. Spain is trying to connect its system to the rest of the EU, with more export pipelines than there are now (maybe only one now?); the selling point is (surprise) that EU reliance on Russia would be reduced. Increased transit fees for feeding NG into the proposed expanded pipeline system would be very welcome in Spain.

[ROCKMAN]

Syn - Exactly. A while ago I posted a story about how much overcapacity Spain has in LNG receiving terminals now that their economy has cooled off. Makes all the sense in the world to try to hook EU NG consumers with 20+ year LNG contracts in an effort to unhook from the Russians.

[ROCKMAN]

Projections…meet reality. Maybe there’s still a future for LNG vehicles but it’s hitting some serious bumps in the road. And this is without the anticipated increase in the price of NG most are expecting somewhere down the road...especially if the US becomes a significant exporter of LNG to the EU:

Reuters - Just over a year ago, Canadian trucking firm Bison Transport took a bet on a potentially game changing technology, buying 15 big rigs powered by liquefied natural gas. It would be the first step toward converting more of its 1,250-strong fleet to a type of fuel that costs about $1.50 less per equivalent gallon than diesel. After 14 months on the road it is less rosy. The savings on fuel have been offset by other costs that are much higher than expected. Bison is not alone. There are already signs that broader adoption is falling short of initial expectations, particularly in off-road sectors like locomotives and mining vehicles.
Bison had anticipated that LNG, which generates fewer miles per unit than diesel, to be 10 percent less efficient; instead, the drop was closer to 18 percent. Maintenance costs were about double that of a diesel tractor, more than budgeted. While Bison is not considering abandoning its investment, it now expects to take at least four years to break-even on the rigs - which cost roughly $75,000 more than standard engines - rather than the two-year pay-off it had hoped for. The longer pay-off "doesn't mean it's a bad investment, but it was definitely not as good as we were hoping," he said.

Still, Royal Dutch Shell last month surprised the LNG industry when it scrapped a small-scale liquefaction unit it was building at its Jumping Pound complex near Calgary. "This additional demand has not developed in line with market expectations," said Shell spokeswoman Destin Singleton. The company also paused work on two other plants, in Ontario and in Louisiana, but Singleton said those projects may resume due to better opportunities for LNG-powered marine vessels.

[rockdoc123]

The issue with European LNG is it isn’t all that cheap. According to FERC the 2013 landed cost for LNG in Spain was $10.90, the UK $10.66, Belgium $10.40. Cheaper than South America ($15.65 in Argentina) and Asia ($15.65 in Japan and $15.40 in China) but still more expensive when you throw in the capital required for new regas facilities than it would be to pay average price from Russia. This fact has been a driver for people looking to do more gas exploration in Europe, the higher price seems to be sustainable

[Newfie]

Seems to be designed for exploration support.

http://www.bbc.com/future/story/2014112 ... cean-giant

[GHung]

[ROCKMAN]

Largest ship but not the largest beast on the high seas. About 340' longer and almost twice the weight:

Now, the world's largest 'floating facility', which is longer than the height of the Empire State Building, has taken to the water for the first time. South Korean shipbuilder Samsung Heavy Industries floated the partially built tanker-shaped vessel - named Prelude - at its southern shipyard in Geoje on November 30. The 1,601ft -long (488m) floating liquefied natural gas (FLNG) platform cannot be described as a ship because it is unable to move under its own steam and must be towed.

Read more: http://www.dailymail.co.uk/news/article ... z3KNuefmFV

[ROCKMAN]

Largest ship but not the largest beast on the high seas. About 340' longer and almost twice the weight:

Now, the world's largest 'floating facility', which is longer than the height of the Empire State Building, has taken to the water for the first time. South Korean shipbuilder Samsung Heavy Industries floated the partially built tanker-shaped vessel - named Prelude - at its southern shipyard in Geoje on November 30. The 1,601ft -long (488m) floating liquefied natural gas (FLNG) platform cannot be described as a ship because it is unable to move under its own steam and must be towed.

Read more: http://www.dailymail.co.uk/news/article ... z3KNuefmFV

[Newfie]

I had seen that elsewhere. A floating LNG plant? I don't recall where it is headed, off Eurpoe I think.

[GHung]

Wikipedia has a page on both:

https://en.wikipedia.org/wiki/Pieter_Schelte
Pieter Schelte is a platform installation/decommissioning and pipelay vessel built for the Allseas company, which is the world's largest.[1] The main construction is underway at Daewoo shipyard, Korea and final completion will be in The Netherlands. Main diesel power comprises eight MAN 11,2 MW engines with two engines each in four separate engine rooms[2] with 13 Rolls Royce 5.5 MW thrusters.[3] The vessel was designed by engineering company Deltamarin. Allseas¹ has committed to build Pieter Schelte at a cost of US$1.7 billion. It will be 382 metres (1,253 ft) long and 117 m (384 ft) wide.

Progress: Long-lead items, such as the power generation equipment and the thrusters, were ordered in March 2007.[4] In June 2008 the high-tensile steel for the jacket and topsides lift systems was ordered.[5] The hydraulic cylinders were installed by Apex Hydraulics on the A&R Winch reacting to a 480 bar test pressure.[6] According to Allseas, the conceptual design of Pieter Schelte and the basic design of the novel twin hulls was completed by Swan Hunter in Newcastle-upon-Tyne, England. The basic design of the lifting systems was completed by the end of 2008 and detail design of the hulls by May 2010.[7] In June 2010 the main construction contract was signed with South Korean shipyard Daewoo Shipbuilding & Marine Engineering Co Ltd at Geoje.[7]

In 2013 the hull was launched at Daewoo and is due for completion in late-2014 in the Alexiahaven, Maasvlakte 2, Port of Rotterdam.[8]

https://en.wikipedia.org/wiki/Prelude_FLNG
Prelude FLNG is the world's first floating liquefied natural gas platform as well as the largest offshore facility ever constructed. The Prelude is being built by Samsung Heavy Industries and Technip in South Korea for Royal Dutch Shell.[1] It is 488 metres (1,601 ft) long, 74 metres (243 ft) wide, and made with more than 260,000 tonnes of steel.[2] In operation, it would weigh more than 600,000 tonnes; more than five times the weight of the largest aircraft carrier.[3]

The hull was launched in December 2013.[4]
......................................

Operations

The Prelude FLNG system will be used in the Prelude and Concerto gas fields in the Browse LNG Basin,[5] 200 km off the coast of Australia; drilling is expected to begin in 2016.[4] and have a planned life expectancy of 25 years.[6]

Natural gas will be extracted from wells and liquified (by chilling it to –162°C). The ability to produce and offload LNG to large LNG carriers is an important innovation, which reduces costs and removes the need for long pipelines to land-based LNG processing plants. However, fitting all the equipment onto a single floating facility was a big challenge.

The system is designed to withstand Category 5 cyclones. It will produce 110,000 BOE per day.

The project is a joint venture with KOGAS and Inpex.[7]

[ROCKMAN]

Newfie - As Ghung said. What I recall for the EU are plans for floating REGASIFICATION plants. Turning LNG beck into NG that can be distributed is neither simple nor cheap.

[KaiserJeep]

It is the largest vessel ever constructed, so far, a single vessel displacing the collective weight of all the world's aircraft carriers:

Presently under construction, she goes online in 2017 and will produce 3.6 million tonnes of LNG annually for 25 years. Shell plans an entire fleet of these LNG platforms:


http://www.bbc.com/news/science-environment-30394137

[Paulo1]

Awesome,

However, right away I see one possible fatal flaw.

Even though offshore access by helicopter is always done by 2 engine machines, locating a heli-pad on basically a floating bomb is not a good idea.

My buddy flies twin engine machines. Shit happens. You can lose a fan on descent or on translation. Dumb design as far as I'm concerned. Human error is always possible. Two friends of mine were flying a Boeing Vertol and a transmission part failed. Their necks were supposedly broken in the first couple of seconds and the machine crashed and burned. Here are a few links to mechanicals.

http://en.wikipedia.org/wiki/Cougar_Hel ... _Flight_91

http://flightsafety.org/hs/hs_jul-aug01.pdf

[ROCKMAN]

Paulo - FYI: More offshore hands working in the GOM die in helicopter crashes then in the drill rigs themselves. And there are even more scary places to land a chopper that have been used for decades: An FPSO: A floating production, storage and offloading unit is a floating vessel used by the offshore oil and gas industry for the production, processing of hydrocarbons and for storage of oil. An FPSO vessel is designed to receive hydrocarbons produced by itself or from nearby platforms or subsea template, process them, and store oil until it can be offloaded onto a tanker or, less frequently, transported through a pipeline.

I used to occasionally set down while in transit on an FPSO offshore Africa. Hell on earth: just the radiant energy coming though the chopped window made you flinch. And the hands working on the ship: they slept in their fire retardant clothing.