Terminal and Bunkering Investments Advance Singapore’s LNG Ambitions
02.15.2020 - NEWS

February 15, 2020 [Riviera Maritime] – Alongside a second FSRU-based LNG terminal, Singapore is growing its bunkering activities and establishing itself as a key hub for LNG shipbuilding and repairs.

Singapore has serious plans in place to become a regional LNG powerhouse. These include expanding its portfolio of LNG and gas assets, upgrading its LNG terminal and bunkering infrastructure, and growing its LNG shipbuilding and repair industrial base.

Indeed, Singapore’s own domestic energy needs will be met increasingly by imported LNG, as natural gas exported from Indonesia and Malaysia is shifted to meet domestic needs.

A 20-year contract with Indonesia to send gas from the Suban Field in the Corridor Block to Singapore via pipeline will expire in 2023. It is one of two gas pipelines from Indonesia to Singapore. It is not clear as to whether gas shipments will be halted from the West Natuna-Singapore pipeline.

Singapore generates about 95% of its electricity from natural gas. Of the 9.96M tonnes of oil equivalent of natural gas imported by Singapore, over 71% was supplied by piped gas from Indonesia and Malaysia, with the remainder derived from imported LNG.

Preparing for the Switch

Singapore has been preparing for the transition to LNG for some years, as a part of meeting its domestic energy security requirements. More than a decade ago, Singapore’s Energy Market Authority (EMA) formed the Singapore LNG Corporation Pte to build, develop, own and operate the country’s first LNG import terminal.
Developed in western Singapore on Jurong Island at an initial cost of S$1.7Bn (US$1.2Bn), the Singapore LNG import terminal received its first commercial cargo in May 2013. As an open-access, multi-user terminal, Singapore LNG (SLNG) terminal is designed for importing and re-exporting capabilities.
Initially, the SLNG terminal opened with a single jetty, two LNG 180,000-m3 storage tanks and regasification capacity of 3.5 mta. Subsequent development phases have added a second jetty, a third 180,000-m3 storage tank and a fourth 260,000-m3 tank and expanded regasification facilities, raising throughput capacity of the terminal to 6 mta. Each of the jetties has four uploading/reloading marine arms, with the main jetty accommodating LNG carriers with capacities of 120,000 to 265,000 m3.
Originally built to accommodate gas carriers from 60,000 to 265,000 m3, the secondary jetty was modified in February to reload small-scale LNG carriers, with capacities of between 2,000 and 10,000 m3. The move underpins the development of the small-scale LNG market in Southeast Asia, where remote power plants can be supported with the breakbulk shipment of LNG cargoes, or LNG as fuel can be delivered to dual-fuel ships bunkering at the Port of Singapore.
We believe that there is good potential for the small-sale LNG market to flourish in this part of the world,” says SLNG senior vice president (commercial and business development) Sandeep Mahawar. As LNG gains traction for power generation, industrial applications and as a fuel, Mr Mahawar says investments will follow. “As demand builds and there is a viable business case, SLNG may consider installing topsides at its tertiary jetty to accommodate more SSLNG reloads,” he says.

If completed, the tertiary jetty would accommodate small-scale LNG carriers with capacities between 10,000 and 40,000 m3.

Depending on the business case, the SLNG terminal could be expanded to a throughput capacity of 15 mta and total storage capacity to 1,500,000 m3, far exceeding the city-state’s own domestic natural gas needs. In 2018, Singapore imported 2.55M tonnes of LNG.

Further expansion in the form of a floating terminal is being explored. In November, Singapore issued an expression of interest (EOI) to build, own and operate a floating LNG terminal that would be licensed by EMA and most likely become operational after 2025. Respondents will have until 28 February to submit their proposals to the EOI, detailing their design concept, minimum and maximum regasification capacity, number, size and capacity of storage tanks, associated equipment, berthing and mooring requirements, projected utilisation rates and operational and capital costs. Proposals are expected to involve floating storage and regasification units (FSRUs) and floating storage units (FSUs).

Global Gas Presence

Established by state-owned investment company Temasek Holdings, Pavilion Energy Pte Ltd supplies natural gas to about one-third of Singapore’s industrial requirements across the power generation, petrochemicals, biotechnology, pharmaceuticals and manufacturing industries. Pavilion Energy, along with Shell Gas Marketing Pte Ltd and Shell Eastern Trading (Pte) Ltd, are companies licensed by EMA to import LNG into Singapore.

While Singapore remains a primary focus of its LNG and gas supply, Pavilion Energy has more global ambitions. In January, Pavilion Energy added 4 mta of long-term sale and supply LNG contracts, following the completion of a deal it inked with Spain’s Iberdrola in 2019.
Besides Iberdrola’s long-term sale and supply LNG contracts, Pavilion also acquired long-term regasification of 2 mta at Europe’s largest LNG import terminal, Grain LNG terminal (UK), regasification access in Spain and the Spanish-France border pipeline capacity. Pavilion Energy also added a time-charter for a newbuild LNG carrier with MAN Energy Solutions’ dual-fuel ME-GI propulsion technology in the deal.
From its newly established European headquarters in Madrid, Pavilion Energy has commenced LNG trading operations and natural gas supplies into the UK and Spain. It has also inked a contract to supply natural gas in Spain to Iberdrola Generación Espana.

Singapore LNG Imports, 2018

To oversee its European gas trading and global LNG portfolio, Pavilion Energy named José Simón as managing director for its Europe operation. Mr Simon is the former head of global gas at Iberdrola.

At the same time, Alan Heng was appointed managing director for Asia, adding to his current role as head of the energy sales and market development division. Both Mr Simon and Mr Heng will establish operations in their corresponding regions and strengthen the organisation’s global processes.

Pavilion Energy has undertaken a variety of LNG-related operations, among which is Singapore’s first jetty-to-jetty LNG transfer operations at the SLNG terminal. Pavilion Energy also recently supported the commissioning of SLNG’s 260,000-m3 Tank 4, with the supply of LNG. With the leasing of the SLNG Tank 3, Pavilion Energy has ramped up its LNG trading and operations activities, including storage and reloads at the SLNG terminal.

In April 2018, Pavilion Energy marked the first direct import to Singapore for delivery to its downstream customers and has in place an agreement with Russia’s Novatek to potentially participate in an offtake from the Arctic LNG 2 project. Both companies will further collaborate on marketing, swaps and trading, joint investments and commercial arrangements for shipping and transhipment facilities.

Singapore’s First LNG Bunkering Vessels

Pavilion Energy has secured the charter for an LNG bunker vessel (LNGBV) under construction at Sembcorp Marine for Indah Singa Maritime Pte Ltd, a subsidiary of Japan’s Mitsui OSK Lines, Ltd (MOL). With an overall length of 112 m and beam of 22 m, the LNGBV will have two GTT Mark III Flex membrane tanks with a combined 12,000 m3 capacity, making it the largest of its kind to be based in Singapore.
Two azimuth thrusters will provide the Singapore-flagged vessel with a high degree of manoeuvrability for port and bunkering operations. Naval architectural firm LMG Marin says that in order to effectively manage the boil-off-gas (BOG) and maintain a high LNG quality, the vessel’s gas-handling system has been designed to be very flexible, allying the use of BOG for engines feeding through dedicated low duty compressors and the ability to re-liquefy it through a sub-cooling system.
During LNG bunkering operations, the vapour return from the bunkered ship can be either sent to LNGBV cargo tanks to avoid pressure collapse, or treated through the sub-cooling unit for the remaining amount. During LNG loading operations, on-board high duty compressors are used to return the BOG to the shore/terminal. A gas combustion unit is also installed to ensure that the maximum tank pressure cannot be exceeded.
The LNGBV is designed to bunker large LNG-fuelled containerships, bulk carriers, car carriers, cruise ship, offshore heavy-lift vessels, or VLCCs. This is achieved by the use of cryogenic flexible hoses stored onboard and handled by long-reach cranes, connected to the fore LNGBV bunkering manifold lines on one side and to a receiving vessel’s bunker station on the other side.

Sembcorp Marine will fabricate the vessel’s Mark III Flex membrane tanks under a licensing agreement with France’s GTT, with delivery of the vessel scheduled for 2021.

Under a deal struck in 2019, Pavilion Energy and Total Marine Fuels Global Solutions will jointly utilise the dual-fuel LNGBV which will be chartered by Pavilion Gas Pte Ltd, a wholly owned subsidiary of Pavilion Energy. Singapore bunker tanker owner and operator Sinanju Tankers Holdings Pte Ltd will be the ship manager for the vessel.

Pavilion is one of two licensed suppliers of LNG bunker fuels in Singapore. The other, FueLNG, is building Singapore’s first LNGBV, with delivery set for Q3 2020. Under construction at Keppel Singmaine shipyard in Nantong, China, the 7,500-m3 LNGBV will operate out of SLNG terminal.
FueLNG signed the US$37.5M contract with Keppel the day after the Maritime and Port Authority of Singapore (MPA) confirmed it would provide both FueLNG and Pavilion Energy with funding to construct LNG bunkering vessels. Each company has been awarded US$2.25M grant to construct an LNGBV as part of a drive to promote ship-to-ship (STS) LNG bunkering in Singapore.
FueLNG is a joint venture between Keppel Offshore & Marine (Keppel O&M) and Shell Eastern Petroleum. The new bunker vessel will be built to the proprietary MTD 7500U LNG design developed by Keppel O&M’s ship design and development arm, Marine Technology Development.

The dual-fuel vessel’s propulsion and power management systems have been designed to ensure that fuel consumption, whether LNG or marine diesel oil, is kept to a minimum. Another notable feature is the LNGBV’s extended flat sides, a configuration which will enable the bunkering of a wide range of ships.

Shipbuilding and Repair Buoyed by LNG Activity

Singapore’s ambitions regarding LNG also extend to its shipbuilding and repair base. In the first nine months of 2019, Sembcorp Marine secured 55 LNG-related vessel repairs and upgrades, exceeding the 41 LNG vessel projects in 2018.

Among its 2019 workload were two floating LNG conversions, one for Karmol, a joint venture between MOL and Karpower International BV, that will see the LNG carrier Dwiputra refit as a 125,000-m3 FSRU.

Built in 1994 by Japan’s Mitsubishi Heavy Industries, the 25-year-old Dwiputra will support an innovative gas-to-power project in Mozambique following its conversion. It is one of three new gas carrier conversion projects announced in September that were added to the Singapore shipyard’s backlog.

Dwiputra is owned by Pacific LNG Transportation Ltd and managed by PT Humolco LNG Indonesia. Deployed in the Indonesia-to-Japan LNG trade, Dwiputra has an overall length of 272 m, beam of 47.2 m, depth of 26.5 m and design draught of 11.6 m, with four Moss Rosenberg spherical tanks.

Karmol will carry out the gas-to-power project in Mozambique. The FSRU will deliver regasified LNG to a floating power station called Powership to produce electricity for the grid for Electricidade de Moçambique (EDM), the Mozambican national power utility. It is the first LNG-to-Powership project announced under the joint venture.

The second conversion announced by Sembcorp Marine in September will see NYK Line’s former gas carrier LNG Flora refit as a 127,000-m3 FSU for Gasfin Development SA. The FSU would be combined with a newbuild floating regasification unit (FRU) to create Ghana’s first LNG import terminal. With a capacity of 28,000 m3 in its two IMO Type C tanks, the FRU will be delivered by China’s Jiangnan Shipyard in Q1 2020. Gasfin is partners with Tema LNG Terminal Co in the development of the terminal.

Russia’s Rosneft has been contracted to supply gas to Ghana National Petroleum Corp under a 12-year agreement.

The third conversion contract secured by the Singapore shipyard will see it make modifications to the 173,400-m3 FSRU BW Magna for Singapore-based gas shipping line BW LNG Pte Ltd. Built by South Korea’s Daewoo Shipbuilding & Marine (DSME), BW Magna is being fitted with ship-to-ship marine loading arms, a full reliquefaction plant and a full LNG sampling system. It will operate under a 23-year contract regasifying volumes to be used to power the Gás Natural Açu’s thermoelectric power plants in the Port of Acu in Rio de Janeiro state in Brazil.


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