Liquefied natural gas (LNG) is natural gas (primarily methane) that has been liquefied by reducing its temperature to minus 260 degrees Fahrenheit. It can be compressed, stored and transported over long distances by ship; and then stored on land in specially-designed storage facilities. The liquefied gas can then be reheated, converted to vapor, and injected into a pipeline system, for distribution throughout a gas system. It can also be transported to local utility storage tanks via truck.
LNG has traditionally been used for supplemental supplies, particularly for winter peak periods. It is also important in particular areas (like parts of New England) to help maintain system pressures at different points of the regional natural gas system. It is a fuel with multiple applications, from powering electric power plants to fueling heavy-duty trucks and water ferries, among other applications.
LNG can help meet demand for natural gas, and provide supply flexibility to the natural gas and energy marketplace.
LNG has an excellent safety record in all its facets - shipping, trucking and storage. The Northeast Gas Association (NGA) runs an annual program with the Massachusetts Firefighting Academy on LNG. The school has been in operation over 25 years, training personnel from utilities, pipelines, and local fire departments.
Use of LNG in the Northeast
LNG remains an important fuel for New England - providing from 20% to over 40% of design day supply in the winter for several local gas utilities. LNG provides about 9% of New England's total annual gas supply.
There is no underground storage located in New England (geologic unsuitability.) LNG is thus an important part of the region's supply and deliverability network.
There are liquefaction and satellite storage tanks in localities in the region that are owned and operated by the local distribution companies (LDCs).
In 2015, according to NGA, the LNG storage capacity in New England among the local distribution companies (LDCs) was 16.1 Bcf (which does not include the storage at the Distrigas terminal). Vaporization capacity for daily sendout by New England gas LDCs was approximately 1.4 Bcf/day; and liquefaction capability by the LDCs was 43,500 MMBtu/day.
LNG is also part of the utility supply portfolios in New Jersey and downstate New York.
LNG in New York is obtained by liquefaction of pipeline gas. Two LDCs maintain LNG peak-shaving plants. The facilities provide service area system reliability as well as assist in meeting peak day requirements. These facilities have storage capacity of approximately 3.2 Bcf, liquefaction capability of 16,800 Mcf/day, and a vaporization rate of approximately 26,100 Mcf/hr.
|Natural gas utilities in New England own and operate LNG storage tanks as a key part of their winter supply portfolio. Total LDC LNG storage capacity is 16 Bcf.
LNG is also utilized by several LDCs in New Jersey, with total state storage capacity of about 4 Bcf.
Imports in the region (and in the U.S.) have been on the decline in recent years as U.S. domestic natural gas production has been on the increase. With its more limited pipeline infrastructure, the Northeast and especially New England, however, remain markets for LNG. The import terminals near Boston and in New Brunswick are well-positioned to respond to market conditions if contract arrangements are in place.
Recent LNG Imports into New England
According to data from the U.S. Department of Energy, Office of Natural Gas Import and Export Activities, 49.7 Bcf of LNG was imported by Distrigas in 2015, compared to about 29 Bcf in 2014. The Distrigas imports represented 54% of all U.S. LNG imports in 2015 (which were 91.1 Bcf, up from 59 Bcf in 2014). As in the U.S., New England LNG imports reached their highest level in recent years in 2007. In the first six months of 2016, Distrigas imported 34.6 Bcf to its Everett terminal.
New England also receives supplies from the Canaport LNG facility in Saint John, New Brunswick. The facility is located about 60 miles from the Maine border. Canaport is a joint enterprise of Repsol and Irving Oil. In 2015 it exported approximately 23 Bcf to the U.S. Northeast.
Import Facilities in New England
There are three import facilities in New England: the Distrigas facility in Everett, MA; the Northeast Gateway facility offshore Cape Ann, MA; and the Neptune facility offshore Cape Ann, MA.
Distrigas is a subsidiary of ENGIE (formerly named GDF SUEZ). Its Everett, MA facility has been in operation since 1971. It has storage of 3.4 billion cubic feet (Bcf). The terminal's maximum installed vaporization capacity is about one billion cubic feet per day; on a sustainable basis, the vaporization capacity is approximately 700 million cubic feet per day. Distrigas also has sendout capability of 100,000 MMBtu/day by truck, which supports local storage refills for local gas utilities throughout the region. The terminal is directly connected to the interstate pipeline network and to National Grid's local distribution system in the Boston area. In 2003, a nearby power plant with two units, with total nameplate capacity of about 1,500 megawatts, entered service, fueled by LNG from the Distrigas facility. Distrigas has received over 1,000 cargoes.
The Northeast Gateway facility is owned and operated by Excelerate Energy. The facility began commercial operations in May 2008. Operating approximately 18 miles east of Boston in Massachusetts Bay, the offshore LNG facility is capable of injecting vaporized natural gas into the existing offshore HubLine natural gas pipeline system operated by Spectra Energy. Excelerate Energy and Spectra Energy teamed up to extend a 16-mile, 24-inch pipeline lateral from Spectra Energy's HubLine to the Deepwater Port. It imported several cargoes from 2008 to 2010. From 2011 to 2014 it imported no cargoes, but it did bring volumes in for deliveries into the New England market in early 2015 and early 2016, during the high-demand peak winter months.
|Canaport facility, New Brunswick, Canada
The Neptune LNG facility is owned by ENGIE, which also operates Distrigas. The facility is located approximately 10 miles off the coast of Gloucester, MA. The Neptune port consists of a buoy system where LNG vessels could moor and discharge natural gas by using onboard vaporization equipment. It is capable of injecting about 0.4 Bcf per day of gas into the pipeline system from a special regasification system on-board its delivery vessels. It has, however, not been active since its start-up, and is currently not operative.
E. Canada Import Facility
In June 2009, the Canaport LNG terminal in Saint John, New Brunswick, Canada began operation. It was developed by Repsol and Irving Oil. It has 3 storage tanks; each tank can hold 3.3 Bcf. It is capable of moving on average over 700 million cubic feet per day into the Brunswick Pipeline and then the Maritimes & Northeast Pipeline for delivery into Maine and New England. Its markets are in the Maritimes, New England and the Northeast. Since its inception, it has delivered over 300 Bcf into the market.
Potential for U.S. Export of LNG
With the strong rise in U.S. domestic production, there is now interest in developing LNG export facilities in the U.S., in many cases reversing the flow of existing import facilities. A number of companies have filed with the federal government for export licenses. Canada is also considering export facilities on both coasts. The extent of exports is uncertain as the amount of liquefaction capacity globally has been rapidly increasing - from countries such as Australia. The U.S. Department of Energy maintains a list of export facility project applications; the list is posted online (http://energy.gov/fe/downloads/summary-lng-export-applications-lower-48-states).
There are currently two LNG export terminals in the U.S. One, operating for decades, is located in Alaska; its export markets are Japan and Taiwan. The other began export operations in February 2016 - Cheniere's facility in Sabine Pass, Louisiana.
Portable LNG (and CNG)
A relatively new development is the introduction of portable or mobile LNG and CNG (compressed natural gas) to bring natural gas to industries and businesses not located near a pipeline system or within a distribution service area. Some areas and businesses in northern New England and New York, for instance, not connected to local gas systems, are opting for gas (LNG or CNG) delivered by truck to meet energy needs. The gas is transported via a trailer that also can serve to offload the gas into the facility. This is currently being utilized to serve paper mills, farms and other entities.
LNG for Transportation
The value of natural gas compared to oil/diesel is also leading many companies with vehicle fleets to consider CNG and also LNG as a transport fuel. LNG is of greatest interest for heavy-duty trucks that travel long distances. In the U.S. and Canada, development is underway of LNG fueling stations along highways to serve the trucking sector. In Canada for example, Gaz Métro has introduced the "Blue Highway" concept, adding LNG fueling infrastructure from Québec City to Toronto. In late 2010, a company called Enviro Express built the first LNG fueling station in the Eastern U.S. in Bridgeport, CT. Distrigas has added LNG fueling at its Everett facility, and some fleets in the region are converting their trucks to run on LNG.
In 2012, ANGA released a study on LNG as a transportation fuel. It notes: "LNG has higher energy density than CNG and thus offers significant potential in NGV market segments where long vehicle ranges are required. Because LNG must be stored at extremely low temperatures, the tanks required to maintain these temperatures on vehicles are large. As such, LNG is most appropriate for heavy-duty vehicles, which can accommodate the volume needed for LNG storage."
LNG is also suitable for fueling of marine transport-such as water ferries-and rail.
LNG Terminals in Northeastern North America
A map of the operating facilities is shown here.
For Further Information
Distrigas of Massachusetts / ENGIE
Repsol Energy North America
LNG/LP Firefighting & Safety Training - NGA and Mass. Fire Academy
U.S. Dept. of Energy / Fossil Energy