The quest for cleaner energy has given rise to the global demand for LNG in recent years. Although there are limitations in domestic supply as well as pipeline imports of liquefied natural gas, many growing Asian economies keep demanding more of it. What is Liquefied natural gas, and what is its economic importance?
What is Liquefied Natural gas?
Liquefied Natural Gas is natural gas that has been turned into liquid form, from its gaseous state at about 2600 Fahrenheit, for easy and safe transportation and storage.
When you liquefy natural gas, it becomes 600 times less than its gaseous state, and to maintain this, you have to keep its temperatures below 160 degrees Celsius. Moreover, the purpose of cooling natural gas before shipping it to the regasification point is to create more space in the transportation channel.
However, the receiving terminal will have to return liquefied natural gas to its gaseous state through regasification before distributing it to consumers.
What Are The Economic Benefits of LNG
Some economic benefits of production and consumption of LNG are, enhancement of economic growth, tax revenue growth, even distribution of natural gas, safe and cheap transportation, easy conversion and regasification, and a greener environment.
Also, it enhances flexible distribution reduces noise pollution, and emissions – well-to-wheel greenhouse gas, particulate, and Nitrogen dioxide and nitric oxide (NOx) emissions. Gone are those days when the LNG market was insignificant and unattractive because producers are discovering its viability and importance to their economic growth.
Top Nine Economic Benefits of LNG Explained
Economic growth:
LNG enhances economic growth both for the producing nations and the consuming countries. Some LNG producing countries earn more money from exports and invariably boost their GDP.
Consequently, their robust economies usually attract more foreign investors, thereby opening-up their markets for further growth.
Tax revenue growth:
Another economic benefit of LNG is tax revenue growth. The global increase in demand for natural gas is attracting more exploration and producing companies to the sector; consequently, host countries can generate more tax revenues.
Even distribution of natural gas:
Suppression of natural gas into LNG ensures a convenient delivery of natural gas to where there is a shortage in supply. With a proper conversion, a producer can ship natural gas worth six hundred tankers to a buyer, with a vessel of similar capacity.
Safe and cheap transportation:
As mentioned above, the conversion of natural gas into liquefied natural gas reduces its volume by up to six hundred times.
Consequently, this does not only make the transportation of natural gas cheap but also make the shipment of the product safe because it no longer has any tendency to explode.
Other Benefits
Easy conversion and regasification:
One advantage of converting natural gas into LNG is that you can regasify it at any time. It does not require too much processing to return it to its gaseous state.
Greener Environment:
The use of liquefied natural gas reduces well-to-wheel greenhouse gas, particulate, and Nitrogen dioxide and nitric oxide (NOx) emissions. Consequently, this promotes a pollution-free environment.
Flexible Distribution:
The conversion of natural gas into LNG enhances flexible distribution. However, the two primary channels of distribution are vessels and pipelines, but a factory that does not have access to pipelines can still receive supplies via trucks.
Reduction in noise pollution:
The use of gas reduces noise pollution because gas engines and equipment generate less noise compared to diesel engines.
Employment:
Another economic benefit of liquefied natural gas is employment generation. The growth in the LNG market offers employment opportunities to citizens in the exporting countries. Moreover, employment opportunities in the LNG sector cut across the entire value chain.
Transportation of Liquefied Natural Gas
The most efficient way of transporting liquefied natural gas from liquefaction to storage facilities, and subsequently, to tankers is the pipeline; however, the best way of shipping it from the production point to regasification terminals is a specialized tanker.
In addition to this, industries that do not have access to supply via pipelines can also take LNG delivery via trucks.Check out the names of the top ten LNG exporting countries here.
Transportation of LNG around the globe requires total commitment to safety and efficiency on the part of all stakeholders, including the consumers.
LNG ships usually make use of leak detection technology, emergency shutdown systems, advanced radar, positioning systems, and other technologies that enhance safety. These are essentials for safe transportation of cargo across a long-distance ocean.
However, to transport LNG across short distance ocean, high-pressure gas pipelines are good options. Additionally, the distribution of LNG to small consumers in remote locations is possible with the aid of trucks.
How do we use LNG?
Degasification terminals disperse LNG through pipelines for homes and businesses. Residential uses for natural gas include cooking, heating, and electricity generation.
The commercial consumers use natural gas for heating and generation of electricity. Also, few commercial vehicle owners use CNG to power their engines.
Natural gas is the cleanest burning fossil fuel as it produces CO2 when combusted and potent greenhouse gas.