According to recent research by GlobalData the global capacity of Liquefied Natural Gas (LNG) capacity is expected to more than double from 341 million tonnes (mtpa) in 2015, to 811 mtpa in 2019. The US is expected to spearhead this growth with a whopping project pipeline of 32 individual liquefaction plants.
Traditionally, the global leader in LNG production has been Qatar. Due to its limited oil reserves and massive gas reserves it has invested significantly in the distribution of LNG to European and Asian importers.
Is there an explanation for this rise? I think there is. There are two drivers that facilitate this growth. The rise of LNG capacity can be explained by two main drivers; ‘efficiency’ and ‘safety’.
Gas resources are located in remote locations and perhaps more importantly, they are very distant from the regions where demand is growing. Demand has been rising particularly in Eastern Asia. These are markets that are not close to gas resources. Therefore pipeline distribution does not offer the economies of scale which traditionally makes natural gas competitively priced, as stated back in March by Natural Gas Europe. The liquefaction of gas opens up the opportunity for truly global distribution. Yes, LNG infrastructural investments are high, but there is the prospect of supplying the increasing demand.
An amazing development is the Shell Prelude, which marks an incredible advancement in this field.
Another key driver is safety. LNG has an enviable track record of safety according to the Center for Liquefied Natural Gas. LNG is stored at atmospheric pressure. LNG must be maintained cold to remain a liquid, independent of pressure. And as a liquid it is not explosive. Explosion is a hazard unlikely to occur with LNG activity. LNG in liquid form itself will not explode within storage tanks, since it is stored approximately – 256°F (-160°C) and at atmospheric pressure.
The LNG industry gives high priority to safety and security for terminals, liquefaction facilities and ships. More than 135,000 LNG carrier voyages have taken place without major accidents or safety or security problems, either in port or at sea. (The International Group of Liquefied Natural Gas Importers (GIIGNL) – 2011).
Balancing act for Operational Excellence
An interesting resemblance can be found in the operational excellence that LNG operators and supply chain partners strive for. Operational excellence in high risk industries require a balancing act between those same two words; efficiency and safety. Bringing costs down, and improving safety might seem like a marriage that is set up for failure. Yet this industry finds itself up for the challenge. Enter digital transformation. The current economic headwind forces to look for ways to work more efficiently, driving costs down, without compromising safety. In fact, one could argue that there is an increased need for better risk mitigation in economic downturn as there is less financial room to overcome huge financial consequences of accidents. However, in order to perform a balancing act, you need to be in control. In control of your operations. You need transparency about the work in progress on your asset or site, you need to be ensured that work is carried out in compliance with all safety precautions. You need to know that your workers are empowered with the right information for them to make the best decisions. You need a highly visual and interactive system to allow greater operational awareness with regards to COW.
Modern Control of Work systems do just that. Digital Control of Work empowers workers to have detailed instructions at their fingertips. It empowers planners to perform task risk assessment for simultaneous operations much quicker and more accurate. Those companies embracing digital, replacing paper based permitting, or integrating control of work software with their planning applications are reaping the benefits in full. Those companies work safer, and more efficient at the same time.
The new reality in Control of Work
Control of Work traditionally has had its focus on safety; controlled operations to ensure operational safety. Digital Control of Work brings a new dimension, the dimension of efficiency. Software streamlines operational processes and allows for both the planners, maintenance teams, operations teams and management to have information ready available. This speeds up the decision process and eliminates trips to and from the permit office, a traditional bottleneck. Certifications of isolations could be done with mobile devices, approvals can be given on the go. Data can be exchanged in real-time, resulting in better insights into the status quo and predictability.
With current developments of LNG prices falling faster than oil, efficiency is one of the main drivers for digital control of work. Looking at our projects and market traction it seems that LNG is leading the digital highway. Together, we work on continuous improvements to safety and efficiency.
The rising tide of LNG