SPE-170600-MS

Floating LNG Chain - Finally a Reality

Michael S. Choi, ConocoPhillips

Copyright 2014, Society of Petroleum Engineers

This paper was prepared for presentation at the SPE Annual Technical Conference and Exhibition held in Amsterdam, The Netherlands, 27–29 October 2014.

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Abstract
It was more than a decade ago that the visionaries of Project Azure predicted that possibly by 2004, a
complete floating LNG chain could be built including floating FPSO (FLNG) and a floating LNG FSRU
(Floating Storage, Regasification Unit), linked by LNG shuttle tankers transporting LNG from the FLNG
to the FSRU. Today in 2014, the chain still does not exist. Although there are many floating LNG
receiving terminals operating successfully around the world, the elusive FLNG has still not materialized.
However, now that construction has started on Shell’s Prelude and Petronas’s PFLNG-1, realization of the
vision of floating LNG chain is imminent.
Many technology advancements have combined to make floating LNG chain a reality. Maturation of
subsea well and control systems have mitigated the risks of subsea well operations. Proven glycol (MEG)
and other regenerative hydrate management systems have allowed longer tie-back distance. Cost-effective
mooring systems for large FPSO, flexible flow-lines and catenary risers have enabled floating system of
FLNG size to be seriously considered. However, it is the advance of floating LNG technologies that have
evolved over the past 20 years that finally tipped the risk-reward equation. Technologies such as offshore
ship-to-ship LNG transfer, motion tolerant processing and rotating equipment, LNG spill and gas safety,
and deep water cooling water lift systems have matured to an acceptable level.
The rewards of FLNG are very compelling. Major cost savings can be achieved by eliminating:
● Well head/production platform(s)
● Processing platform to facilitate gas treating, liquids recovery and stabilization
● FSO for condensate and NGL products
● Gas compressor and pipeline to transport gas to an onshore LNG plant
and replace with a FLNG system located in the field. There are also the intangible cost savings such
as efficiency gains by constructing the entire system in a ship yard, material and manpower logistics, and
shorter project duration. In places where space constraint and regulatory restrictions make land-based
LNG liquefaction and regasification difficult, FLNG and FSRU are cost-effective alternatives.
This paper will present the economics drivers that make floating LNG chain attractive to producers and
buyers alike, and the many conventional production technologies and those unique to FLNG that
combined to enable FLNG chain to be developed with confidence. The realization of floating LNG chain
will enhance the economics of LNG as a preferred fuel.
2 SPE-170600-MS

Introduction
More than a decade has passed since the conclusion of Project Azure, a development program funded
under the European Union THERMIE program, for a floating LNG chain, i.e. a floating FPSO (FLNG)
and a LNG floating storage, regasification unit (FSRU), linked by LNG shuttle tankers transporting LNG
from the FLNG to the FSRU, which delivers gas into the pipeline grid onshore. The goal of the project
was to position the participants to start Front End Engineering Design (FEED) that leads to real field
development projects. The Azure consortium, made up of experienced LNG EPC contractors, technology
providers, classification authorities, and 5 major International Oil & Gas Companies, concluded in March
2000 that a FSRU can be built and operated safely within 3 years and a FLNG within 4 years.
The consortium was not too far off on the FSRU, as a Storage Regasification Vessel (SRV) was
started-up in 2005 for the Gulf Gateway project in the USA, and a full FSRU in 2008 for the Bahia Blanca
Gas Port in Argentina. Currently, there are13 FSRU/FSU projects in operation, 11 under construction, and
more than 8 being considered. Wood Mackenzie reported import through FSRU terminals totaled nearly
10 million tons in 2012 and will comfortably exceed that level in 2013.
In contrast, there is still no FLNG in operation anywhere in the world. Why is it taking so long for
floating LNG chain to become a reality?
The missing link in the chain, of course, is a FLNG (FPSO for LNG production in the field). It is the
most technologically complex and costly piece of the system. Although at the conclusion of Project Azure,
there did not appear to be any “show stoppers” than would prevent FLNG to be built in 4 years, it is not
until recently that all the necessary technologies have matured and applied individually that the first-of-
a-kind risks associated with the entire system have become acceptable.
Technology Enablers
Discussion of LNG facility begins with the liquefaction process, and FLNG is no different. The industry
has conducted numerous studies and the conclusion is that all the commercially available technologies are
acceptable. As with onshore plants, the selection is more to do with operator experience and preference
SPE-170600-MS 3

Offshore Moored FSRU

Dock-side Moored FSRU

Boom-to-Tanker LNG transfer system with mooring yoke

than technical attributes. What is more important is the marinization of the process and mechanical
equipment to accommodate the space limitation and vessel motions.
Reliable offshore ship-to-ship LNG transfer in all but the worst storm conditions is a must. Systems for
both tandem and side-by-side loading have been developed and qualified. Tandem loading has the
advantage of being able to tolerate rougher seas and familiar to mariners for open sea oil transfer. The
disadvantage is that custom built or specially modified LNG carriers are needed to accept LNG at the bow.
All existing carriers have LNG manifolds at the side of the vessel. Two major tandem loading configu-
4 SPE-170600-MS

Conventional cryogenic coupler under test

Multiple hose system with hosier mooring

and monitoring system

rations have been engineered: the so called Boom-

to-Tanker (BTT) and multiple hoses systems. The
Conventional cordless loading system control BTT system utilizes field-proven Chiksan LNG
loading arms (hard-pipe) and cryogenic swivels.
Connection between FLNG and tanker can be done
by hawser (as with conventional oil tankers) or a mooring yoke.
However, the FLNG projects announced to date have chosen the conventional side-by-side system that
is used for jetty loading. The obvious advantage is that with such a system, the FLNG can offtake to all
standard LNG carriers, including vessels of opportunity. In addition, familiar LNG loading system
components may be utilized. These include cryogenic couplings, loading arm control and monitoring, and
emergency release systems.
Although conventional side-by-side LNG loading arms have a more restrictive operating envelop,
extensive computer simulations and model testing have confirmed its suitability for most locations except
for the extreme North Sea. One reason is the massive size of the FLNG vessel which experience very little
motions. The FLNG vessel must be very large, since it provides the equivalent of all the product storage
of an onshore plant. For a base load LNG project, the minimum LNG storage capacity is more than
200,000 m3 (~140,000 m3 to fill a standard LNG carrier plus a few days of production). In addition, there
will probably be a need for condensate storage in excess of 125,000 m3 (once again dictated by standard
tanker size and operating flexibility), NGL products of 80,000 m3 and the usual material and consumables
for such an operation. Then there is deck space required for topside production and process facilities, and
living quarters. All these requirements add up to a massive FPSO vessel for LNG. Shell’s Prelude and
other FLNG concepts, when completed, will be among the largest vessels ever built. As reported in the
press, Prelude is about 488 meters in length with a beam of 74 meters and draughts about 18 meter of
water. It is dimensionally larger than a Nimitz class air craft carrier and has by far a greater pay load.
ConocoPhillips’ FLNG designed for 3.9 mtpa of LNG is of similar size to Prelude at 480 meters length,
72 meters beam and 16 meters draft.
SPE-170600-MS 5

Prelude comparative size

ConocoPhillips’ 3.9 mtpa FLNG design

Massive vessel requires massive mooring system

for station keeping. This is an area where FLNG has
benefited from advancement in the industry. With
progressively larger conventional FPSOs operating
in harsh environment, the industry has accumulated
huge experience and expertise in mooring systems.
Robust and field proven systems that combine the
functions of station keeping and produced fluid
transfer are available. Depending on the application
and vessel design, FLNG operator may select either
an internal or external turret system.
The heart of the mooring system is the turret with
External turret mooring system
its multi-level swivel stack. The swivel stack pro-
vides a rotating joint assembly for the various pip-
ing systems and a slip-ring assembly to bring electrical, instrument and communication cables (for wells
control and monitoring) from the rotating FLNG vessel into the earth-fixed part of the turret. The fluid
joint assemblies consist of swivel modules for large-bore piping and utility swivels for small-bore piping.
6 SPE-170600-MS

Internal turret mooring system with risers

Recent developments in very large-diameter swivels

made possible higher stacks with many more swivel
modules. Improvements in seal materials and de-
sign, and the design of the accompanying pressur-
ization systems have extended the operating range
of fluids, pressures and temperatures. It is now
possible to replace swivel seals in situ, offshore,
while keeping the other swivels in the stack in
operations. Such change-outs have been performed
successfully for the Anasuria FPSO in the North
Sea. This capability further reduces the risk of
FLNG downtime.
Subsea flow lines and risers are used to supply
the FLNG with well fluids. The risers are connected
to the turret and rely on the swivel stack for final
fluid passage onto the vessel. Riser technologies are
Turret with swivel stack well mastered in deep water and not specific to
FLNG. Reliable flexible risers up to 12” diameter
are available for water depths less than 300 m. They
may be configured in steep S, steep wave, lazy or pliant wave. Beyond 500 m water depth, steel hybrid
risers, steel catenary risers (SCRs), or riser towers can be implemented. All these technologies and
hardware are well proven in the field in oil and gas services and available from a number of manufac-
turers.
Subsea production system is one of the great technological advancements that have enabled the
industry to produce in deeper water and further offshore. What was once avoided by the industry is now
commonly accepted. Industry statistics have shown failure rate of subsea trees to be lower than dry,
probably due to the more rigorous QA/QC procedure. Huge improvements have been made to electro-
hydraulic system design and components. Reliability is no longer a big concern. In fact, confidence is so
high as for the industry to consider subsea High Integrity Pressure Protection System (HIPPS) seriously.
Due to advances in computer and marine electronics, capability of subsea well control and monitoring
now rivals those on land. As for flow lines and piping, the subsea industry has developed special coupling
and tools that are both robust and cost-effective. Subsea well clusters with their many jumper connections
are just as reliable as wells on a template with pre-installed well manifold.
SPE-170600-MS 7

Typical subsea field architecture

Membrane LNG Containment System

Sloshing model test with load cells

Inside a membrane LNG tank
8 SPE-170600-MS

Flow assurance, especially hydrate control, for

gas production in deep water is always a costly
challenge. Although no perfect solution has been
found, regenerative mono-ethylene glycol (MEG) to
inhibit hydrate formation has made it more manage-
able. Acceptance of MEG injection was made pos-
sible by improvement in the MEG regeneration
system and operation excellence. Whereas continu-
ous methanol injection was the standard practice,
methanol is now used only for cold well start-up or CFD analyses
hydrate plug dissolution. This has significantly re-
duced storage requirement and associated offshore
supply chain logistics.
Most land-based LNG plants use large industrial gas turbines to drive refrigeration compressors and for
electric power generation. Those machines cannot tolerate marine motions, nor are they practical for
FLNG application due to their large size and weight. Learning from offshore platform and FPSO best
practices, motion tolerant aero-derivative gas turbines are adopted as primary driver for both refrigeration
and power gen applications on FLNG. Some operators prefer electric motor or steam turbine drive
refrigerant compressors. No matter the preference, aero-derivative gas turbine will be used for power
generation and may supply some or all the steam through turbine exhaust heat recovery system (combined
cycle). They are inherently designed for extreme motions and quick onsite engine replacement. The results
are a more compact and light weight driver system that is motion tolerant and allows for efficient offshore
overhaul or engine replacement.
Vessel motions are a challenge for all floating production systems. Over the past decades, FPSO
operations has provided a wealth of knowledge and best practices on how to mitigate the effects of motion
on topside facilities and personnel. With the exception of perhaps the cryogenic heat exchangers, these
learnings can be directly applied to FLNG. For the special LNG exchangers, extensive development
programs have yielded designs that are deemed acceptable for FLNG motions and qualified mechanically
for the application. Although there is no floating operating experience yet on spiral wound or other special
cryogenic exchangers, computational fluid dynamic (CFD) simulation and model testing have indicated
acceptable fluid distribution and heat transfer.
A motion challenge unique to FLNG is partial LNG tank sloshing. The need for a flat vessel deck to
accommodate production and processing facilities drove many designers toward the use of membrane
LNG containment system.
The membrane containment system utilizes layers of foam, plywood and mastic all covered with a
5mm thick skin of cryogenic steel, hence the name membrane. The system has no structural load bearing
capability. All the loads are transferred to the hull of the ship which becomes brittle at cryogenic
temperatures. While the thin steel membrane acts as the liquid barrier, the foam/plywood system insulates
the hull from LNG temperature inside the tank. Since the tanks are constantly being filled and/or emptied,
they will be partially filled at times and subjected to sloshing. This is a phenomenon not experienced by
LNG tankers. LNG carriers are always full or empty during transient. Once again, the industry depended
on CFD simulations and model testing to analyze the partial tank sloshing effects. Mitigation measures
have been developed that are deemed acceptable for the long-term integrity of the tanks and containment
system. The newly commissioned FLNGs expected in 2016 and beyond will be the final test.
An alternative to membrane is the IHI Self-Supporting Prismatic-shape IMO Type B (SPB) LNG
containment system. Unlike the membrane system, SPB is inherently more robust, with internal bulkheads
construction that minimizes sloshing, thus more suitable for partial cargo operations. Both membrane and
SPB tanks have been qualified for ConocoPhillips FLNG projects.
SPE-170600-MS 9

IHI SPB LNG containment system

Why Floating LNG Chain

Global LNG trade is expected to more than double
to 725 Mtpa by 2020. As consumers and govern-
ments around the world recognize the environmen-
tal advantages of power generation with natural gas,
demand for LNG has increased significantly. Of the
2, 500 Tcf (420 Billion BOE) of gas available
around the world, nearly half is reportedly located
offshore in water depth of more than 200 meters and
further than 250 kilometers from land. For some of
these offshore fields, potential cost savings of 35-50
Shell’s Prelude FLNG hull floated out of dry dock in Dec. 2013.
percent has been estimated for FLNG alternative
over a conventional development with land-based
plant. This may amount to billions of dollars for a typical project. The cost savings are achieved by
eliminating: well head/production platform(s); processing platform that facilitates gas treating, liquid
recovery and stabilization; floating storage and offtake (FSO) vessel for condensate and NGL products;
gas compressors and pipeline for transport gas to an onshore LNG plant; with an all-purpose FLNG
system located in the offshore field. Now with the launching of Shell’s Prelude FLNG vessel and
construction of the Petronas’s PFLNG-1, offshore LNG production on a FPSO will finally be realized in
2016. This will complete the floating LNG chain.
Floating LNG regasification projects first emerged as a solution to the difficulties and protracted nature
of securing regulatory approval to build shore-based LNG reception facilities (especially along European
and North American coasts). More recently, cost and time have become the main drivers. The abundance
of skilled labor and logistical infrastructure, combined with the predictability and efficiency of ship-yard
construction has made FSRU the technology of choice at many locations over field erected, onshore
terminal. These regulatory and logistical advantages are also recognized for FLNG.
With the rapid growth of LNG projects, labor and logistical infrastructure are severely challenged in
some productive regions. An example is Western Australia where multiple projects in remote locations
have created a shortage of resources of every kind. The results are large cost over-run and massive
significant delays. FLNG can ease the burden by offering established organization and discipline work
force, existing supply chain infrastructure and efficiency of construction in a ship yard. The intangible cost
savings and shorter project duration are further incentives for FLNG. Another example is the Lavaca Bay
10 SPE-170600-MS

Artist’s image of Petronas PFLNG-1 on location

NLNG River Delta Site, Bonny Island, Rivers State, Nigeria

regasification terminal conversion to liquefaction

and gas export in North America. Space constraints
and regulatory restrictions have combined to cause
the operator to decide on a FLNG solution.
Even onshore gas production can benefit from
FLNG. Among onshore discoveries, many are lo-
cated in river deltas where LNG export by tankers
requires long and costly jetty to reach acceptable
water depth. When combined with extensive site
preparation and continuous dredging to maintain a
viable shipping channel, the economics and safety
of an onshore plant is severely impaired. These
challenges can be eliminated by piping the gas to a
FLNG moored at a near-shore location with conve-
nient tankers access. Artist’s concept of near-shore FLNG with tanker loading
SPE-170600-MS 11

Conclusion
Realization of the floating LNG chain has been a long process, some 25 years in the making. After more
than a decade since completion of Project Azure, the last link in the chain has finally been forged with
the launching of Shell’s Prelude FLNG hull. Much of the credits can be attributed to companies like Shell
and ConocoPhillips who have the perseverance and focus to devote resources toward the research and
development of all the necessary floating LNG process technologies. However, FLNG also benefited from
industries relentless advances into further and deeper offshore. Much of the enabling technologies for deep
water production can be directly applied to FLNG. Reliable subsea well and control systems have
mitigated the risks of well operations. Glycol (MEG) and other regenerative hydrate management systems
proven on deep water platforms have allowed longer tie-back distance. Robust subsea architecture and
hardware have reduced failure rate and need for frequent invention. Cost-effective mooring and risers
systems have enabled floating system of FLNG massive size to be engineered with confident.
All these and more industry-wide technological advances have complimented the research and
development that are exclusive to FLNG. Technologies such as offshore ship-to-ship LNG transfer,
motion tolerant process and rotating equipment, LNG spill and gas safety, and membrane containment
system that can withstand sloshing loads in partially filled tanks. The success of FLNG will hinge on the
meticulous integration of the complimentary deep water production and floating LNG technologies.
The pioneers of FLNG are challenged by first-of-a-kind uncertainties. Not all FLNG technologies are
field proven. Some can only be qualified through computer simulations and pro-type testing. However, the
value addition of FLNG is worth the risk. Billions of dollars of NPV may be gained over a conventional
offshore production, pipeline and onshore LNG plant development. Now that Shell Prelude FLNG vessel
has been launched and completion is imminent, the vision of a floating LNG chain will finally be realized.

Acknowledgments
The author thanks Shell, FMC, FRAMO, ConocoPhillips, Saimpan, Petronas, IHI, ThyssenKrupp and
Technigaz for the graphics in the paper; and the ConocoPhillips colleagues who provided information and
support in the marine and subsea disciplines.