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Presentation to IE Aust Perth, 2/10/12 Prepared by Nick White, Director Process Engineering, Clough Presented by Dr Julie Morgan

Introduction • There are currently A$170 billion of LNG liquefaction projects  under development in Australia • This presentation provides some rules of thumb for making  screening level assessments of onshore. loading and shipping requirements  CAPEX breakdown b kd  of f th the main i  components t  of f an LNG d development l t . refrigeration power  and emissions  LNG storage. onshore  base load LNG  liquefaction developments and includes:  Gas reserves required to support an LNG development  Criteria for selection of LNG export rather than alternatives such as a  pipeline  The relationships between production capacity capacity.

Why y Choose LNG for Gas Export? p • Pipeline vs LNG development ‐ determined by distance from  supplier li  to customer:  <2500 km: pipeline  >2500 km: LNG • Liquefaction reduces specific volume of gas by a factor of 600  making transportation of large volumes of gas by ship feasible • Alternative shipping options such as gas to liquids and  p  natural g gas either immature. and/or more expensive p compressed • LNG a proven technology with excellent safety record Non‐explosive in liquid or vapour state in unconfined spaces Only one major accident at the operating facilities world‐wide • LNG is environmentally friendly Significantly lower CO2 emissions than coal or oil .

2% .8% LPG .3% C5+ .Feed Gas Supply • Gas reserves required: 1 tcf of gas required per Mtpa of LNG over  20 years • For an offshore gas field in Australia the minimum economic LNG  plant capacity would be approx 4 Mtpa ‐ requiring 4 tcf of gas • Where does the feed gas go (conventional natural gas)? LNG .85% Fuel .2% CO2 .

 flares. drains.  Dehydration. h heating ti  medium. water. nitrogen Mercury y Removal End Flash F l Gas Fuel G  General facilities – Firewater. removes N2 and  recompresses end flash gas for use as fuel gas) CO2 and H2S Removal LPG & C5+ Removal (LNG quality control) Fractionation  Fractionation – Separates LPGs for refrigerant and/or product Dehydration Liquefaction LPG and d Condensate to Storage  Product storage and loading (including BOG)  – LNG.LNG Liquefaction Plant and LNG Train A LNG plant comprises:  Feed gas pipeline reception facilities  One or more LNG trains comprising: – Gas Pre‐treatment (Acid Gas (CO2 & H2S) Removal. Mercury Removal) Feed Gas from Pipeline Reception Facilities – NGL Removal – Liquefaction (condenses the NG) – End flash (auto‐refrigerates LNG. LPG  Refrigerant storage  Utilities – P Power. di  fuel f l gas. Condensate. plant buildings and  infrastructure LNG Train LNG to Storage . t   instrument air.

Q GAS HG GAS: LNG LIQUEFACTION UNIT LNG HL LNG: Work. Tav = 27oC 1 Mtpa = 3. W .120 kJ/kg (13 kW/tpd) W = 37 x 1120/1000 = 41 MW Q = W + H = 41 + 32 = 73 MW Heat Rejection.220 tpd (37 kg/s) x 365 x 0.88 x (1 ‐ 0.How Much Power to Produce 1 Mtpa of LNG? • • • • Mtpa = Daily production at Tav (tpd) x 365 days pa x System Availability ‐ BOG losses  Typical average ambient temperature in Northern Australia.03)   Assuming overall system availability of 88% and 3% BOG losses Enthalpy change to liquefy methane: HG ‐ HL = 861 kJ/kg  Refrigeration duty: H = 37 x 861/1000 = 32 MW  Refrigeration compression power (work):  Heat H t rejected j t d  t to atmosphere: t h   Typical specific power for base load LNG plant at an average ambient temperature of  27oC is 1.

03 t CO2 / t LNG • Quantity of LNG shipped ~85% of rundown capacity when account taken of system y availability y and BOG  Overall system availability typically ~88%  BOG losses from storage & loading facilities ~3% of LNG rundown rate .7% Feed gas MW: 1% increase raises production by approx 1.4% • • • Fuel gas consumption: 7 to 9% of feed flow (depending on liquefaction technology (specific power) and driver type) Dehydration unit mol sieve regeneration flow: ~7% 7% of feed gas flow CO2 produced by process:  Combustion: 0.7% Refrigerant condenser: 1% increase in UA increases production by approx 0.Rules of Thumb for Liquefaction Plants • Factors impacting LNG production:     Ambient temp: 1oC increase reduces LNG production by approx 1.25 t CO2 / t LNG (base load plant with industrial GTs)  From AGRU: 1 mol% CO2 in feed equates to approx 0.3% Feed gas pressure: 1 bar increase raises production by approx 0.

1  Typical Liquefaction  Technology Nitrogen expander Application Peak shaving plants. dual  mixed refrigerant.2 to 1.Size Range g  of Liquefaction q  Plants LNG Train  Capacity Range  Mtpa Mini LNG <0.8 Mtpa in Qatar) . pure  component cascade * 3 to 5 Mtpa trains provide the optimum capacity in terms of economies of scale although larger trains have been constructed (e.  vehicle fuel. ship boil off  gas liquefaction For domestic  consumption. transport  by road or rail Overseas export by ship Mid Scale 0.g.5 Single mixed refrigerant Base Load  3 to 5* 5   Propane pre‐cooled  mixed refrigerant.

1 1.0 1.7 13 1.Comparison p  of Liquefaction q  Technologies g Liquefaction Technology Single expander Dual expander Single mixed refrigerant (SMR) Pure component cascade Propane pre‐cooled mixed refrigerant (C3‐MR) Dual mixed refrigerant (DMR) APCI APX (C3‐MR plus nitrogen expander cycle) Relative  Efficiency 1.1 0 1 to 1 0. Mtpa <0.0 LNG Train Capacity  Range.2 1.1 to 1.1 1.5 1 to 6 1 to 5 1 to 5 5 to 8 * Specific power at an average ambient temperature of 27oC is approximately 1120 kJ/kg (13 kW/tpd) .3 1.0* 1.5 5 0.

 15 round trips pa)  Conventional ships p  130.  m3 .) ( )  To date largest tank volume 200.  to 145. Loading g and Shipping pp g • Storage volume: volume of largest  ship hi  plus l  3 days d  production d i  (approx. latest Qmax ships p  260.  m3. g .000 .e.000 130 000 m3 ship hi  can  transport 1 Mtpa (i.000 .LNG Storage.000 m3 • Maximum LNG loading berth  occupancy about 50%  Typically 8 Mtpa per loading berth to  allow for maintenance and other  downtime • Number of ships determined by ship capacity and distance to  import terminal  Shi Shipping i  f from NW Australia A li  to north h Asia: A i  one 130.000 .

  LNG storage and loading. CAPEX • OPEX typically 3% of CAPEX per annum . infrastructure) LNG Supply pp y Chain CAPEX Breakdown:     Upstream Development: LNG Plant: LNG Transportation: Recei ing & Re‐gasification Terminal Receiving Terminal: 10% 40% 30% 20% • LNG Plant CAPEX Breakdown:  Pre‐treatment: 6%  Liquefaction: iquefaction: 50%  Utilities: 16%  LNG Storage: 18%  Loading Facilities: 10% N t  Li Note: Liquefaction f ti  only l  20% of f t total t l supply l  chain h i  CAPEX.Costs of a Base Load LNG Development • • • Current CAPEX of Greenfield LNG developments in Australia (includes upstream  development and LNG plant) ~A$2.000/tpa S b Subsequent t trains t i  (brownfield) (b fi ld) economically i ll  very attractive tt ti  as much h can b be shared h d  with the  foundation project giving economies of scale (e.500 to 3. gas supply pipelines.g.

onshore  base load LNG developments with respect to: • Selection of preferred export option • Relationship between gas reserves and plant capacity • Facility requirements and capacities • Factors F t  influencing i fl i  process performance f • Indicative development costs and economies of scale Fi ll  it should Finally. h ld be b  noted t d these th  are only l  rules l  of f thumb th b and d should h ld  be used accordingly  .Conclusion Simple rules of thumb have been presented that allow high level  screening of onshore.