Unlocking the power of uniformity in a shifting LNG market
As global LNG demand shifts geographically and experiences new, dynamic regional volatility driven by competing political, economic, and environmental agendas, there are strong indicators of accelerated demand for LNG in the near future.
With predictions that the global LNG market will be worth an estimated US$255 billion by 20301, investment is still needed to meet forecasted demand in the next few years. It is essential that supporting infrastructure is developed – and normalised now – to facilitate the cost-effective operation of safe and efficient LNG supply chains.
One of the most profound examples of this is how the LNG spot market has influenced trading patterns and, in turn, logistics. This increasing commoditization has created a new era where flexibility is king, elevating the role of assets that enable fast, agile operations. Specifically, we have seen the increasing use of floating storage and regasification units (FSRUs), which have subsequently become more complex. The quest for more agile operations has driven the use of ship-to-ship transfer, a relatively new process in LNG supply chains – and one that highlights the industry’s evolution away from traditional fossil fuel-based infrastructure.
Moving away from the (dis)comfort of legacy systems
To ensure effective performance and safety during the ship-to-ship LNG transfer process, one of the ships ideally replicates a shoreside operation. Facilitating this has incorporated the development of various innovations such as new designs of hoses or coupling solutions, but one of the biggest leaps in addressing this is moving from ‘analogue’ hardware to support new digital transfer systems.
Advancing ship-to-ship connectivity is increasingly essential to address the inherent compatibility between ships’ systems, particularly ESD legacy link types. Most of the large- scale LNG analogue fibreoptic links were designed in the 1980s using the technology standards of the time and then were reverse-engineered in the 1990s to produce compatible links. However, these had no formal, common design specifications, thereby storing up a wealth of complexity and inefficiency for the future. In fact, there are no other on-board systems that require the same level of legacy interface support.
Through continuous development over the last 30 years, it is now possible to re-engineer the core processing of ship-to-shore link systems, removing traditional hardware barriers that prevent ships fully linking. This enables any LNG carriers equipped with the latest SSL models to take part in ship-to-ship transfer processes by using any of their ESD links, particularly the fibre optic system. This now enables telecommunications more akin to a traditional ship-to-shore connection, rather than managing around the historical limits that used to exist on outdated safety links. These are ideal for STS and FSU installations, especially those that have multiple LNG transfer processes.
As ship-to-ship transfer becomes mainstream, modernizing and harmonising systems is essential for de-risking operations as well as significantly contributing to operational efficiencies. In an evolving market where systems and processes can be fragmented due to geographical or operational differences, the value of uniformity can’t be under-estimated. It could also become business critical if the components in some older systems stop being produced. Taking inspiration from the mainstream technology market, imagine if there was use of an LNG transfer system that reflected the evolving Apple/USB-C universal charger approach.
Creating a new normal
Setting the baseline for new compatibility requirements will facilitate the transition to smarter STS systems. Even though there is significant progress to be made in levelling up current compatibility standards, it is also important that we look to the future to anticipate the next application challenges, ensuring frameworks can encompass oncoming requirements. It’s important to look at this through the lens of implementing systems that can also be adapted for a wider basket of fuels, enabling energy companies to pivot more quickly as options such as ammonia gain uptake.
Creating these operational frameworks and standards is very much a work in progress for SIGTTO, SGMF, and OCIMF. However, as the pace of innovation outstrips regulation, it’s important that energy companies, engineers, manufacturers, and technology developers collaborate to find compatible ways of working so that agile, symbiotic infrastructure can support the evolution – and commercial potential – of the LNG industry.
1 Liquified Natural Gas: Global Strategic Business Report, Research and Markets, December 2023