Technological Developments in Small Scale & Retail LNG

Gas Infrastructure, India-201622nd July, 2016

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PRADEEP KUMAR BANSAL VICE PRESIDENT – PROJECTS GSPC LNG LIMITED

Flow of Presentation

1. Trend of Natural Gas Consumption in India2. Key to success – Infrastructure Development3. Technological Advances & New Avenues in LNG

Supply Chain4. Key Drivers of Small Scale LNG5. New Avenues - Small Scale LNG (SSLNG)6. Retail LNG Application7. Issues & Challenges in SSLNG8. Conclusions

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Trend of Natural Gas Consumption in India

26.77 26.97 27.06

40.83

46.04

41.17

34.35

28.9826.78

25.31

9.0310.93 10.54

11.82 12.8915.41 14.44

17.73 18.5421.31

25%

29% 28%

22% 22%

27%30%

38%41%

46%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

40.00

45.00

50.00

2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16

BCM

Sale by Producing Companies LNG import LNG as % of Total Consumption

Increasing trend of RLNG usage in the overall gas consumption mix 3

Existing Gas Infrastructure in India

4Source: International Gas Union, A.T. Kearney Analysis, PNGRB Report, News, ICRA Report

Existing Gas Infrastructure in India

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Growth in Infrastructure(Key to Gas based Economy)

• LNG regasification Infrastructure *– Current capacity (21.5 MMTPA)

* Source PPAC. Note: Issues of Breakwater at RGPPL, Dabhol & Pipeline connectivity at PLL, Kochi.

– Under Construction/ Planned expansion (22.5 MMTPA)

• Gas Transmission Network– Current transmission pipeline 16,250 Kms.– Under Construction/ Planned expansion 13,000 Kms. (approx.)

• City Gas Distribution– More Geographical Areas being offered in PNGRB bid rounds.– Huge Potential opportunity:

• To convert 20.18 Crore LPG users to PNG (31.64 Lacs at present).• Country has only 1081 CNG outlets vis-a-vis. 56,190 Retail outlets for

Petrol/Diesel.

Comparative Gas Infrastructure

7Source: GSPC Internal, EIA & PPAC -Ready Reckoner Report June 2016

6400 864513673 16191

10700

24000

40000

55000

29250

0

10000

20000

30000

40000

50000

60000

2000 2005 2010 2015

KMIndia & China – NG Pipelines

India Cumulative Pipeline Length China Pipeline Length

India - Including the Proposed Pipelines

1

46 7

1113 13

1 24 4

0

5

10

15

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

India & China – LNG Terminals

China - No. Of LNG Terminals India - No. Of LNG Terminals

Natural Gas Pipeline SystemsSr. No. Country KM ( Kilometre)

1 China 55,000

2 India16,250 (Existing)

13,000 (Approx Under Execution)*

3 Canada 445,000

4 USA 490,745

Need for SSLNG

Pipeline connectivity is key for developmentof Gas Infrastructure. However, Pipelineconnectivity is capital intensive as well astime taking process. Therefore, SSLNG is analternative for the development of GasInfrastructure.

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Classic LNG Chain

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Extended LNG Chain

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Advanced LNG Chain

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NEW AVENUES - Small Scale LNG (SSLNG)

Small Scale LNG

LNG Bunkering

Coastal/Break Bulk LNG

Retail LNG

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Beyond Conventional Business – SSLNG the way forward

Key Drivers of Small Scale LNG

Key Drivers

Economic Price Differential Price gap between FO, Diesel and LNG

Technological

Development of technology to support SSLNG

Development of Gas Engine Tech

Environmental Drive towards lesser Nox, Sox, emission/pollution control etc.

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LNG Bunkering

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In general, the fuel system comprises:• Tank(s) for storing LNG under cryogenic temperature & pressure

(vacuum insulated)• Vaporizer(s) for converting LNG into gaseous fuel• Pressure build up vaporizer to maintain tank pressure• Cold-box (gas tight box) containing all control and instrumentation

needed for the tank operation as well as the vaporizer(s)• Bunkering station for filling the tank with LNG from outside source• Vacuum insulated pipeline connecting the bunkering station with cold-

box• Possible placing of the fuel tank:

� On the deck� Bellow the deck

• Class society: DNV, IGC, Code, Germanischer Lloyd

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Coastal Transportation of LNG

Small LNG Carrier: LNGC’s smaller than 20,000 m3 capacity LNGC’s between 20,000 & 40,000 m3 LNGC’s between 40,000 and 50,000 m3

Coastal Transportation

LNG Carrier (Small Capacity) +

Compatible Jetty

Filling in LNG bottles and shipping with

Articulated Tug barge

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Coastal Transportation through small LNG carrier

The Infrastructural requirement is Huge.

Jetty requirement at loading point with loading arms Jetty requirement at unloading point with unloading Arms

Dedicated Control system with all automatic safety devices

Small LNG carrier can not be berthed at conventional jetties.

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Coastal Transportation through Articulated Tug Barge

LNG transferred through Bullets, avoiding huge infrastructural investment on loading, unloading.

Ideal for small scale Industrial Usage located near costal areas.

Large no of bottles can be transported per barge.

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Barge Mooring Arrangement

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Significant Bottle Nos. can be Transported by a single Barge

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Typical LNG Bottle

Lifting from a barge

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110 ton on a single hook

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Landing…

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…onto foundations

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Tank and vaporizers installed

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Hub & Spoke Distribution from Any Terminal

Multiple Receiving Depots as Required

Barge Cargo Units Can Be Re-Located as Needed

Deliveries Sized to Volume/Demand

No weather limitations

Coastal Transportation through Articulated Tug Barge - Merits

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Potential Coastal Route for LNG Barges

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Potential Coastal Route for LNG Barges

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Potential Coastal Route for LNG Barges

Retail LNG Application

Retail Retail LNG

Road Transport

Fuel

Rail Transport

Fuel

Comm. & Ind.Mining

Aviation

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Relative Co2 Emission

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LCNG Vs CNG Stations

High Purity – LNG is already purified during liquefaction stage.

Energy Cost Reduction – 4 times less than CNG (on account ofcompressor)

Lower Maintenance cost – 3 times less than CNG

Flexibility – Can be used for both LNG & CNG filling plusdomestic gas for nearby residential complexes

Independent Re-fueling due to dedicated LNG Storage

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LCNG Vs CNG – Power Consumption

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Elements of LCNG station

LCNG Station Operation

LNG Transport

LNG Storage

LNG Pump

LNG Dispenser

LCNG Vaporizer

CNG Storage

CNG Dispenser

LCNG Pump

System ComponentsSystem ComponentsVaporizer, pumps, storage Vaporizer, pumps, storage tank, dispenserstank, dispensers

Equipment – LNG Storage Tank

• 15,000 gallon (57,000 liter) capacity

• 175 psi (12 bar) maximum working pressure

• Stainless steel inner vessel• ASME Section VIII, Division 1• All stainless steel piping• All relief devices to a common

vent stack

Equipment – LNG Pump

• Submerged centrifugal pump within an ASME code vessel– ACD model TC-34

• Serves to both offload an LNG transport and fuel LNG vehicles

• All control valves and instruments are installed & wired at the factory

Equipment – LCNG Pump

• Positive-displacement reciprocating pump can provide LNG at pressures up to 5000 psi (354 bar)

• Available in sizes 3 to 20 gal/min (11 to 75 liter/min)

• Uses approximately 1/5 the horsepower of a traditional CNG compressor

• ACD model SGV 3

• Forced draft ambient vaporizer, optional ASME code – CRYOQUIP model BAF

• STAINLESS Steel lined for high pressure

• Up to 400 bar standard pressures, auto defrost, whisper fan design

• Manufactured in India

Equipment – LCNG Vaporizer

LNGLNG

AUXILLIARYAUXILLIARY

EQUIPMENTEQUIPMENT

Dispensers

Fuel tanks Local controls

Remote controls

LCNG station

Location: KatsutaSource: Tokyo Gas

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LCNG station

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LNG Truck Loading

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LNG Truck Transportation

LNG by Road

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LNG Truck Unloading

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LNG Rail Transportation

Issues and Challenges

Customers with smaller requirements

Substitution of fuel to take place, thus cost economics will always be the primary goal

Customers unwilling to contract for a long term

Lack of experience in operations and commercial transactions

Customer may be working on thin operating margins

Customer may be unwilling to invest into newer technologies, infrastructure & equipments.

Customer may not have best in the market credit ratings (quality)

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Conclusions

LNG = ƒ (Price Spread, Oil Prices, Environmental Regulations)

Oil prices play an important role when LNG competes alternate fuels like FO, LDO, MGO, Naphtha (and hence investment decisions heavily dependent on oil prices).

SSLNG has potential to fight Urban Pollution (esp. With respect to highly polluted cities in World).

Strict Environmental Norms (in ECA, USA, EU) has been the foremost cause for adoption of LNG as marine fuel.

Project economics should improve; by standardization and modularizations.

Regulation compliance could be a challenge. No common regulation. Absence of any regulation in new markets (countries).

BOG management is a big challenge in SSLNG.

Govt support to promote creation of basic infrastructure for SSLNG to takeoff. 51

Thank You

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