Natural gas industry experiencing ‘paradigm shift’

There is tremendous upside potential for using liquefied natural gas as a transportation fuel over the next several decades, industry officials were told Friday on the closing day of a mega conference in Houston.

The 17th International Conference & Exhibition on Liquefied Natural Gas brought together industry and government officials from around the world to discuss the past, present and future for LNG.

Natural gas is an abundant resource in the U.S., and there is increased pressure on the government from firms to be able to convert the resource into LNG and export it to other countries.

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Friday’s discussion included presentations on LNG for long-haul trucking and marine transportation, floating liquefaction facilities and technological advances.

“It’s not often you get to participate in a  paradigm shift in an industry, and I think we are doing that now,” Anders Ekvall, vice president, LNG Americas, at Shell told attendees.

Ekvall said there are challenges ahead for the industry, but also some opportunities. By 2020, LNG could meet one-fifth of the world’s gas needs, he said, adding that significant investments by the industry will be needed to make that a reality.

Environmental regulations are among the factors that are driving LNG as a transportation fuel, Ekvall said. Shell is deploying its technology as part of the effort.

“We are not just talking about it, we are doing it,” he said.

Offshore, Shell also is working on a massive project to deploy a floating LNG facility that would allow it to access and develop gas fields that would otherwise be too costly to develop.

A floating LNG facility refers to a water-based vessel and equipment designed to enable the development of offshore natural gas resources, convert it into LNG and delivery it to market.

Shell launched its Prelude floating LNG project in May 2011.

It has started building a floating liquefied natural gas facility to produce and export LNG off the coast of Australia. The floating facility will chill natural gas produced at the field, shrinking its volume so it can be shipped to customers in other parts of the world. Shell says ocean-going carriers will load the LNG as well as other liquid by-products, including condensate, for delivery to market.

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The first production from the facility is expected in 2017.

Attendees at the conference were told Friday there were some 17 models of floating LNG facilities on the showroom floor, suggesting intense interest in the concept, which is still in its infancy.

Harry van der Velde, Shell’s manager for floating LNG development, said global energy demand will put pressure on supplies in the decades to come, making such projects more vital.

Ron Snedic, vice president, corporate development,  at the Gas Technology Institute, said there is optimism and excitement in the LNG industry about the possibilities ahead.

“This is the first time we have had an LNG conference focus so much on growth and transportation opportunities,” he said.

The four-day conference at the George R. Brown Convention Center began Tuesday.


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Read more FuelFix coverage of the LNG 17 conference in Houston: