LNG Shipping Symposium Northern Germany
Small scale distribution for coastal and short-sea shipping
Session II – The economic aspect
Klaipeda, 17. Oktober 2014
Trond Jerve - Bomin Linde LNG
Dr. Thomas Tork - Linde Gas AG
LNG pricing
Example of LNG pricing, delivered as ship fuel in Europe
70
60
50
40
30
20
10
Gasprice & Liquefaction Large Scale Logistics / Small-Scale Logistics
Import Terminal
23/10/2014 Source: Bomin Linde LNG 2
Spread between oil and gas has been growing for years –
U.S. LNG exports to support this trend
Price development of selected fuel types [Euro/MWh] Comments
70 Additional demand for MGO as of
2015 could lead to higher prices
60 Significant potential for decrease of
LNG prices:
50 1. Start of U.S. LNG export
2. Restart of nuclear plants in
40
Japan
3. Large LNG projects in Australia
30
going live
4. Russian-Chinese pipeline to
20
reduce future LNG demand in
China
10
0
12.2008 08.2009 04.2010 12.2010 08.2011 04.2012 12.2012 08.2013 04.2014
Landed LNG
TTF GO
MGO0.1%
(0.1%) FO
HFO3.5%
(3.5%)
NWE
23/10/2014 Source: Reuters, Platts, Datagenic, Bloomberg, BominLinde LNG 3
A wide variety of LNG price indexations and flexible
contract durations can be offered
Contract Durations Availability
Short-term contract (<3 years) Offered by Bomin Linde LNG including specific conditions
Mid-term contract (3-5 years) Offered by Bomin Linde LNG
Long-term contract (5 – 10 years) Offered by Bomin Linde LNG
Spot cargos Not standard offer – to be discussed
LNG Indexations Type Hub/Index Location Status
Title Transfer Facility (TTF) Gas The Netherlands Default
National Balancing Point (NBP) Gas United Kingdom Default
Henry Hub (HH) Gas U.S.A. Default
Marine Gas Oil Futures (ICE) Oil Europe/USA/Canada Optional
Brent Futures (ICE) Oil Europe/USA/Canada Optional
23/10/2014 Source: Bomin Linde LNG 4
Important drivers for LNG Price: supply chain, bunkering
location, -method and -frequency
Most common Small-Scale LNG Supply Chains Comments
LNG SOURCE TRUCK CUSTOMER Bomin Linde LNG optimizes
VESSEL
the LNG supply chain jointly
with the customer
Wide range of LNG prices
due to different customer
LNG SOURCE FUELING
VESSEL
CUSTOMER requirements
VESSEL
LNG supply chain should be
considered in early project
stage
FUELING
VESSEL
LNG SOURCE TRANSPORT LNG CUSTOMER
VESSEL STORAGE VESSEL
TRUCK
23/10/2014 Source: Bomin Linde LNG 5
LNG today competitive with Marine Gasoil – economies of
scale and location essential
Fuel: Cost perspective in shipping (MWh) Costs + optimisation from supplier perspective
Optimal mix of Levers:
A, B and C A Subsidies &
Economies of
learning effects B scale
Cost of
Spread Oil-Gas
capital C (-> Shale Gas)
Fuel costs
Fuel costs
MGO LNG Small Small scale mark-up Gasprice
Scale
Logistics
23/10/2014 Source: Bomin Linde LNG 6
Depending on volume demand, bunkering location and
method BLLNG offers LNG prices in MGO & HFO range
Overview: price quotes1) for LNG supplied by Bomin Linde LNG
EUR/MWh [LCV]
66
64
62
60
58
56
MGO
54
52
50
48
46
44
42
40 HFO
38
36
34
0
1) Note: price quotes heavily dependent on bunkering location, bunkering method as well as volume demand – quotes depicted include supply via terminal, truck, ship and containers
23/10/2014 Source: Bomin Linde LNG 7
Differentiate yourself with LNG as a
financially superior and clean marine solution.
Bomin Linde LNG ©
Bomin Linde LNG GmbH & Co. KG
Dornbusch 2 - 20095 Hamburg, Germany
Tel: +49.40.468959-0
Fax: +49.40.468959-103
Mail: [email protected]
Web: www.bominlinde.com
Bomin Linde LNG is backed by solid and highly
committed shareholders
Key facts
EUR 17 bn in revenue (2013), ca. 9,280 employees
Businesses: oil trading, tank terminal storage, aviation fueling, gas supply,
biogas, biofuels, quality management
Offices in 30 countries on 5 continents
60+ years of experience in oil and energy business
Largest privately owned natural resource trader in Europe
EUR 16.7 bn in revenue (2013), ca. 63,500 employees
World-leading gases and engineering company: industrial and medical gases
sales, plant engineering, end-to-end supply chain solutions
German blue chip company (DAX listed)
452 offices on 5 continents
130+ years of experience in gases and engineering industry
Bomin Linde LNG ©
Oiltanking and Linde Industrial Gases jointly have a
strong strategic presence with 326 locations worldwide
Locations: Oiltanking and Linde Industrial Gases Comments
Oiltanking owns
and operates 73
tank terminals in
23 countries in
Europe, North
and South
America, as well
as in the Middle
East, India and
Asia
Linde Industrial
Gases operates
253 facilities in 84
countries on 6
continents
23/10/2014 Source: Marquard & Bahls, Linde, Bomin Linde LNG 10
Impressions: layout of a Bomin Linde LNG fueling terminal
23/10/2014 Source: Bomin Linde LNG 11
Impressions:
SEAGAS fueling vessel traveling near Stockholm
Bomin Linde LNG © 12
Impressions:
Fuelling of the Viking Grace via SEAGAS fueling vessel
Bomin Linde LNG © 13
Together with its partners Bomin Linde LNG developed
the procedure for truck-to-ship purging operations
Truck purging operation – impressions Comments
Bomin Linde LNG performed a
purging operation for AGA AB, a
Scandinavian subsidiary of the
Linde AG, which is one of the
shareholders of Bomin Linde LNG
Together with Euroservices, Bomin
Linde LNG developed the
procedure for truck-to-ship
purging operations
BLLNG also designed the
equipment used for purging
operation – tailor-made couplings,
hoses and valves
Operation lasted ca. 50 hours with
7 people involved and 2 trucks
operating around the clock (24/7)
23/10/2014 Source: Bomin Linde LNG 14
Higher LNG prices in Asia due to shut-down of nuclear
plants – Lower prices in North America due to shale gas
U.S. pipe-gas and landed LNG prices in selected countries [USD/MMBtu]
United Kingdom Belgium
USD 6.60 USD 6.78
Cove Point
USD 2.44
Spain
9.15 Euro Japan
Lake Charles USD 10.50
USD 3.40
Rio de Janeiro
USD 9.92
Actual landed LNG prices for September 2014
Excluding the cost of liquefaction (natural gas)
23/10/2014 Source: : Waterborne Energy Inc., IHS, Bomin Linde LNG 15
Small Scale LNG track record: Linde has been involved
in many milestones of small scale LNG development
Gablingen, Tasmania, Bergen, Kwinana, Stavanger, Shan Shan,
Germany Australia Norway Australia Norway China
Small to (21 tpd) (50 tpd) (120 tpd) (175 tpd) (900 tpd) (1,300 tpd)
mid-scale
liquefaction
plants
Distribution
& storage,
refuelling
equipment
and com-
ponents
Australia Altamont, Scandinavia
Linde owned CA, USA
small scale
LNG
operations
23/10/2014 Source: Linde AG, Bomin Linde LNG 16
Bomin Linde LNG covers the entire value chain and
develops the infrastructure for marine LNG bunkering
Small-Scale LNG Supply Chain Comments
LOADING Bomin Linde LNG is covering the
ARM
entire LNG value chain
TRUCK This is enabled through unique
competences as well as financial
commitment internally as well as
CONTAINER
from the shareholder side
“Tailor made solutions” such as
LNG SOURCE RAILCAR LNG CUSTOMER
STORAGE VESSEL small terminals, containerized
solutions and dedicated bunker
FUELING
VESSEL
vessels at individual bunkering
locations can be realized
TRANSPORT
depending on volume demand
VESSEL
“Economies of scale” is key for
TRUCK
intermediate storage and
transportation
23/10/2014 Source: Bomin Linde LNG 17
LNG bunkering operations in ports have to be jointly
developed by several parties – checklists already exist
Overview: LNG bunker operations in practice Comments
Request allowance for LNG bunkering operations in port from harbour master Regulations for LNG
1 bunkering (e.g.
and from local port authorities
tugboats required,
safety distances
Refer to harbour master and port authorities to determine port specific safety
2a and buffer time)
requirements (e.g. tugboats, safety distances, specific location etc.)
depend on harbour
master and local
Depending on bunkering method, refer to supporting documents i.e. checklists & port authorities (e.g.
2b
guidelines published byInternational Association of Ports and Harbours (IAPH) port of Antwerp
requires 48 hours
Determine and develop bunkering procedure with all parties involved (i.e. port prior notice)
3
authorties, client, LNG supplier & other service providers etc.) Regulations and
safety requirements
Register the arrival of the LNG-fuelled vessel at the port where bunkering as well as IAPH
4 checklists will differ
should occur in advance depending on local port operators
depending on
bunkering method
Perform LNG bunker operation at designated location according to IAPH (e.g. shore-to-ship,
5
guidelines and local port regulations truck-to-ship and
ship-to-ship)
23/10/2014 Source: International Association of Ports and Harbours (IAPH), Bomin Linde LNG 18
