The viability of retro-fitting a re-liquefaction plant onboard a 150,000m3 DFDE LNG carrier

Abstract

Changes in the type of LNG trading has resulted in an increased demand for vessels with greater operational flexibility and efficient propulsion plants. This has led to the demand for the capability to re-liquefy boil-off-gas (BOG) and return it the cargo-tanks and sell it as cargo or burn BOG or fuel oils depending on the relative costs at the time. This allows energy companies to divert LNG to markets with high seasonal peak demand and take advantage of highest prices, yet still meet long-term SPA's. The research in this paper was conducted by means of qualitative data collection and subsequent analysis using market management tools to ascertain the technical viability. From this point, the data was fed into economic analysis to produce quantitative data that allowed for a determination for a final investment decision for a number of market scenarios. LNG carriers with re-liquefaction capability are positively differentiated from those without it. They are capable of greater operational flexibility, and as a result, their competitive position is improved. They can demand higher charter rates as the increase in cargo quantity offloaded results in increased revenue. They present a lower environmental footprint as there is no requirement to thermally oxidise excess BOG in a GCU. The analysis shows it is technically viable to retrofit a re-liquefaction plant onboard 150,000 m3 Dual Fuel Diesel Electric (DFDE) LNG carriers. The economic viability is more complicated, situation-dependent, and influenced by market forces, environmental legislation, and political interference.