This reference is for an abstract only. A full paper was not submitted for this conference.
Key decisions at the beginning of any grassroots LNG project critically impact the ultimate success of the project. The variables to consider are numerous but from a high-level perspective, commercial variables such as available gas reserves, finance ability, corporate objectives and market penetration must be considered in combination with project related variables such as schedule, capital expenditures, and life cycle costs. The ultimate objective is to develop a strategy providing the highest rate of return to the owners whilst taking full account of the risks that can be managed by the owners.
Shipping logistics, pre-investment for expansion trains, safety and environmental impact, technology selection and EPC contracting strategy all come into consideration early on in the process. One of the factors that most shape a LNG project is train capacity. Given the importance of economies of scale, the LNG train size that is chosen, along with the associated refrigeration turbine/compressor configuration, is a key decision that impacts almost all other variables. However, since the train capacity impacts so many project factors, the correct choice for one project is not necessarily the correct choice for another. The unique challenges that each project faces must be considered in order to arrive at the best decision for a given project.
This paper draws on the experience of the Egyptian LNG project which is one of several grassroots projects started in the 2000's that remained with the nominal train size of 3.6 MTPA that became standard in the last half of the1990's. It should be noted that 3.6 MTPA is an annualized FOB rate - the actual PFD rate or design rate of the facility is over 4 MTPA. Some other contemporary projects have designed at 5 MTPA and one recent project has announced a 7.5MTPA train. Is it possible for smaller trains to compete in today's LNG business?
The overall strategy for the Egyptian LNG project has been to standardize on the design developed for Atlantic LNG Trains 1–3. In this paper, we will provide an evaluation of the key considerations leading to this strategy and show that highly competitive capital costs can be achieved with smaller trains whilst also significantly reducing project schedule and minimizing owner risk.