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LNG business: the eclipsed side

LNG contains two forms of energy; one measured in terms of Calorific Value (CV) which is widely recognized. The other is cold energy, which also has value, but is seldom talked about and utilized. There are many uses of the cold energy contained by LNG. We will discuss here the potential and opportunities to utilize this hidden cold energy for making profits and add value to the economy.

LNG is made by liquefying natural gas by application of a lot of energy, cooling the gas from atmospheric temperature to -160 degrees Centigrade. The gas volume is shrunk in the process by a factor of 600. It is transported through LNG ships to LNG terminals in importing countries and is regasified again by application of thermal energy and is put in the gas network. The cold energy goes into hot air unutilized. This is the case in most countries, although Japan has been utilizing this cold energy for a long time. Recently, Spain, Singapore and India have started talking about it and are at varying stages of implementation. By 2017, only 23 LNG terminals out of a total of 111, had some form of utilization of this cold energy.

There are many requirements and uses of cold energy; refrigerating food, medicines and others; space air conditioning; hospital and industrial processes, etc. Inter-governmental Panel on Climate Change (IPCC) has estimated that by the turn of the current century, air-conditioning demand alone would consume half the electricity that is generated today.

Currently, cold energy is wasted and even more energy is applied to gasify the cold LNG, costing money and adding to pollution. This is truer in Floating Storage Regasification Units (FSRUs) than in land-based LNG terminals. If the cold energy contained in LNG is usefully utilized in the afore-mentioned cold applications, it has been estimated that, an additional revenue of 50 USD per ton of LNG can be generated. For an LNG terminal of 3.5 MTPA, it would amount to an annual revenue of 175 million USD per year.

Traditionally, cold energy has been utilized, where it is utilized, nearby LNG terminal itself by installing cold storages and air-conditioning chillers, etc. However, new uses of cold energy have been developed which allow off-terminal uses at distant places. Cold energy is utilized in liquefying air, oxygen and nitrogen and other gases. Cheap and abundant availability of industrial gases promotes industrialization. Nitrogen and as well as oxygen are used in many industries. The gases are transported to far off places for utilization in various end uses. Liquid nitrogen-based refrigerated trucks have been introduced which have replaced noisy and polluting diesel engine based mechanical refrigeration. Nitrogen cylinders are placed under the truck bed or on the top and liquid nitrogen is passed through radiators cooling the inner truck space. Vaporized nitrogen is exhausted into the atmosphere.

Air separation plants producing oxygen, nitrogen and argon are the most useful and versatile application. LNG has a liquefying point of -161 degrees Celsius, oxygen – 183 and nitrogen -196. It is clearly apparent how much energy saving it would be to cool air mixture from LNG liquid point of -161 to oxygen and nitrogen temperature (-183,-196) as opposed to from atmospheric temperature of 25-30 degrees Celsius.

A new use of liquid nitrogen is in cryogenic energy storage for electricity grid. Liquid nitrogen expands 700 times in being gasified to come to the atmospheric condition. Liquid nitrogen can pass and expand through engines and turbines and create mechanical/electrical energy. As liquid nitrogen is transportable to anywhere, cryogenic power storage facilities can be located anywhere. Liquid nitrogen is also used in cooling turbine inlet temperature (TIT), enhancing thermal efficiency of single and combined cycle power plants.

A novel use of liquid gases has emerged in the form of cryogenic grinding used in recycling of old tyres. Old tyres are passed through mechanical cutters and then are dipped in cryogenic tanks or are sprayed upon. This makes the rubber brittle which enables separation of textiles and steel fire from rubber tyres and facilitates micro-grinding. There is apparently a lot of potential in Pakistan for this in addition to the traditional cold energy uses in refrigeration and air-conditioning.

In Pakistan, there are two LNG terminals with a combined capacity of 8 million tons per year. In near future, another 3 LNG terminals are going to be added to increase the LNG capacity to more than 17.5 MTPA. The world trade in LNG is projected to exceed 500 MTPA. Thus nationally and internationally, there is going to be a very large potential of cold energy availability and its utilization.

FSRUs may offer difficulties in utilizing cold energy, although some arrangements can be done. On-shore terminals or on-shore gasification along with FSRUs may be more conducive to cold energy utilization. In Port Qasim area, a special zone of cold energy industry may be created to utilize the cold energy potential. District cooling projects may also be launched for the adjoining areas and recreational facilities as well. Some new features may have to be added to LNG policy to promote and encourage adequate utilization of cold energy. For Take or Pay existing terminal, a profit sharing formula or royalty may have to be introduced. There is significant potential for promoting food and agro-industry through augmenting cold supply chain. Liquid nitrogen-based refrigeration may add another dimension to this industry. Cold energy utilization can lead to lower RLNG cost and attractive return to investors.

Syed Akhtar Ali, "LNG business: the eclipsed side," Business Recorder. 2021-02-25.
Keywords: Social sciences , Conspiracy theories , US economy , Electronic media , Social media , Nigeria , China , Germany , Japan Korea , Russia , Singapore , WHO , Economics , Economic growth , Economic zones , Natural gas , Climate change , Port Qasim , FSRU , LNG

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