The FSRU Market: Story of growth

Aditya Aggarwal's picture
Aditya Aggarwal, Director, ABS Global Gas Solutions
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Gas has established itself as a truly indispensable ally in the global endeavour to tackle emissions. Additionally, there is a limited growth potential in the demand from conventional gas markets. This opportunity has fueled the development of Floating Storage and Regasification Units (FSRUs) to facilitate access to newer and emerging markets. Due to the flexibility of operations, increased natural gas production, time and cost savings during construction, the FSRU market is experiencing a period of rapid growth.

In recent years, as projects in the oil and gas sector are cancelled or put on hold, one niche segment is booming. The surge in interest from emerging markets for FSRUs is striking. FSRU projects offer the advantage of being economical and more efficient to execute than land-based facilities. While long-term contracts with traditionally saturated markets such as Japan are expiring, LNG sellers are attracting additional business from emerging markets that have a large customer base and substantial growth potential for energy. With a much lower requirement for initial capital investment, FSRUs provide a feasible solution for any nation with a seaport to gain access to gas supply. They also have the ability to serve as a bridge solution to meet immediate needs until the onshore regasification facilities are commissioned.

With 26 FSRUs currently in operation, the newest project is in the LNG market in Turkey. As an integral part of the new FSRU contract, ABS was selected to class the FSRU for BOTAS, Turkey’s oil and gas pipeline operator. Planned to be built at Korea’s Hyundai Heavy Industries shipyard, this FSRU will be designed for 170,000 cubic meter storage capacity and with a regasification discharge capacity of 1,000 mmscfd. The FSRU will be jetty moored off the coast of Turkey and operated by Mitsui O.S.K. Lines (MOL).

The unit will be classed using the ABS Guide for Building and Classing LNG Regasification Vessels. This Guide is important for designers, builders, owners and operators of liquefied gas carriers/tank barges as it specifies the ABS requirements for obtaining the regasification classification notation. It was developed to provide guidance for the design, construction, and survey of Liquefied Natural Gas (LNG) vessels utilizing regasification systems.

Many experts consider that the option to commission an FSRU allows new markets the flexibility, supply security and price competitiveness to trade gas to fulfill their own demand. As new and existing markets embark on the journey to execute their FSRU projects, ABS is the right strategic partner to facilitate successful design, execution, and operation of these assets. ABS’ unique experience and knowledge of the regulatory and operational requirements, coupled with our commitment to cutting-edge technology and world-class service, makes us the ideal trusted advisor for the next FSRU project.

Hear from a wide range of industry experts at Gastech 2018 in Barcelona discussing key industry developments, including the growth and advancement of FSRUs and other crucial technology.  Book your delegate place today.