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FLNG Offshore and NearshoreContrasting Architectures, Technology Drivers and Commercialization Challenges

Joe VergheseApril 2016

Offshore FLNG Development Key Features:

Offshore gas field LNG FPSO LNG Transportation

Onshore LNG Receiving and

Storage

Subsea Wells LNG FPSO LNGC LNG Storage Gas Markets

> > >

FEED gas is sourced from offshore subsea wells and subseagathering system.

The FLNG unit can be located in challenging deepwater terrains.

Operational threats to topsides process performance arise from subsea flow assurance issues (reception of slugs, pulsating gas flow).

Severity of metocean can impact topsides performance and deliverability.

Atshore Deployment

FEED Gas Source Trestle and Jetty FLNG Barge Onshore LNG Receiving and

Storage

Interstate/intrastate

gridBarge

LNGC

LNG Storage Gas Markets

> > >

Key Features:

The FLNG unit is moored atshore or portside in protected waters, against a jetty or wharf.

FEED gas (e.g. shale gas) is sourced from the grid and meets pipeline transportation specifications.

Since the FEED gas is pre- conditioned, this minimizes

pre-liquefaction gas treatment.

The benign metocean atshore drives lower liquefaction equipment margins and simplifies storage and offloading technology selection.

Probable locations for atshore deployment are off the

coast of US and Canada, in a proximity of interstate/intrastate pipeline

grids

Inshore Deployment

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Spur Line LNG FPSO S2S Offloading to LNGC Onshore LNG Receiving and

Storage

Interstate/intrastate

grid

LNGC

LNG FPSO

LNG Storage Gas Markets

> > >Spur Line

Key Features:

The FLNG unit is located in inshore waters, typically a few kilometres from shore. Several reasons drive selection of this configuration:

• Poor or unstable bathymetry at the shore line

• Significant dredging operations to cut and maintain the channel for arriving LNG carriers

• 15 metres keel depth required at the jetty location

2 feasible considerations:

Offshore jetty arrangement (or optionally an artificial island) mooring both the

FLNG unit and the LNGC

Or

A seabed moored FLNG vessel (shown above), with product offloading to LNG

trade carriers in a side by side configuration

Topsides Configuration & Building Blocks

Inlet Gas Facilities

Solvent Regen

Gas Treating

Regen

Dehydration

LPG/Cond Off-loading

LPG/C5+ Storage

LPG Extraction

LNG Storage

Liquefaction

LNG Off-loading

UtilitiesUtilitiesH20

To shipsTo ships

C3/C4’s Condensate

Dry gas

FEED Gas Preparation LNG Liquefaction

How is process performance differentiated between atshore, inshore

and remote offshore deployments?

Atshore and Inshore FLNG• Pre-conditioning of gas for pipeline grid transport

does not eliminate FEED gas treatment steps required on the FLNG unit

• Very stringent CO2 (max 50 ppm), moisture (1 ppm) and BTEX removal specifications will require installation of associated removal units

• CO2 specification of pipeline gas (typically 2% max) limits duty and size of AGRU regenerator system

Offshore FLNG• Front-end treatment must be resilient to

contaminants in raw gas received from subsea wells

• Enhanced motion characteristics in this environment will require application of greater design margins to assure performance

• Adverse impact on weight, footprint and overall availability

Topsides Configuration & Building Blocks

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Feature Offshore FLNG Atshore FLNG Inshore FLNG

Feedstock Subsea Production (raw gas) Pipeline Specification Conditioned Gas

Pipeline Specification Conditioned Gas

Upstream Architecture Subsea gathering system Interstate and intra-state grid Interstate and Intra-state grid

FLNG Substructure Shipshape (FPSO) Barge Shipshape (FPSO)

FEED Gas Treatment Requirement

Acid gas removal, dehydration, HG removal

required

Required, but to a lower duty specification due to gas pre-

conditioning and benign motions

Required, but to a lower duty specification due to gas pre-conditioning and moderately

benign motions.Feed Gas Pre-treatment On FPSO On barge or (optionally) onshore On FPSO

LNG Liquefaction On FPSO On barge On FPSO

FLNG Liquefaction Cycles FEED Matured

Turbo-expander, SMR and DMR Turbo-expander, SMR and DMR Turbo-expander, SMR and DMR

Concept/system differences

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Feature Offshore FLNG Atshore FLNG Inshore FLNG

MCHEPFHEs are robust, SWHE’s require enhancement for structural integrity and

performance.

PFHEs are robust, SWHE’s require enhancement for mechanical integrity and performance. Higher system integrity due

to benign motions.

PFHEs robust, SWHE’s require enhancement.

Higher system integrity due to benign motions.

AGRU Columns and Scrub Column

Significant design margins required to ensure on-spec performance, avoidance of

channeling, etc. arising from FPSO motion envelope.

Lower design margins required due to benign motions.

Lower duty specifications for columns arising from gas pre-

conditioning to pipeline specification.

Lower design margins required due to benign motions.

Lower duty specifications for columns arising from gas pre-

conditioning to pipeline specification.

Cooling Medium Typically Seawater Cooling. IFC and World Bank guidelines

limit seawater temperature rise at discharge. Could require adoption

of air-cooling.

Depending on inshore location, same concern as with atshore

seawater discharge temperature could apply.

Power Supply Generation on FPSO. Power supply, if reliable, can be arranged from onshore grid.

Usually generation on FPSO. Grid power supply by subsea cable

possible.Main Control Room and LQ Required on-board FPSO. Possible onshore in proximity of

jetty. On-board FPSO.

LNG and LPG StorageIHI Prismatic or Twin Row

Membrane (driven by prevailing metocean).

Twin Row Membrane (standard membrane tanks may be feasible).

Twin Row Membrane or IHI Prismatic.

LNG OffloadingSide-to-Side offloading with loading arms or cryogenic

hose.Jetty-based loading arm. Loading arms for inshore jetty or

side-to-side offloading.

Concept/system differences

Conclusions

Atshore FLNG represents the lowest level of technical complexity and project risk, followed by the inshore based FLNG

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Technical Complexity

Project Risk

Capital Expenditure

Commercialization

Offshore FLNG represents higher technical complexity, with elevated project and operational riskThis can arise from:• Marrying of the subsea architecture with the FLNG• Raw gas as the feedstock for offshore FLNG instead of

pipeline conditioned gas for atshore/ inshore FLNG• The more hostile metocean conditions, leading to

potential impairment to performance of topsides systems (fractionators, exchangers, etc.)

Technical Complexity

Project Risk

Capital Expenditure

Commercialization

Cost indicationsAtshore

FLNG proponents have claimed unit costs of circa 600 USD/tonne

per annum of LNG capacity.

Offshore FLNG 1100 to 1500+ USD/tonne per annum (depending on

inclusion of costs of the subsea system).

Inshore The unit technical cost for FLNG is expected to fall in

between the atshore and the offshore FLNG cost indications.

Visit our website: http://www.advisian.com/our-sectors/hydrocarbons

Contact: Joe VergheseDirector – HydrocarbonsE: joe.verghese@advisian.com

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