With Biden Admin’s approval of exports with the Alaska LNG Project, could this be the first step towards an LNG Jones Act Trade? If California and the rest of the US are serious about its environment projections, emissions cuts, and global warming could LNG be seen and implemented as a solution to more than just national security.
LNG is already being exported from a number of terminals along the East and Gulf Coasts that are far closer than Alaska to the two places in the United States that import LNG (New England and Puerto Rico), so it’s hard to see why this new project would move the needle that much. So long as LNG carriers cost at least $500 million more to build in the United States than abroad there won’t be a Jones Act LNG trade outside of bunkering vessels and the transport of ISO containers.
LNG is NOT a solution to GHG emission and global warming, unless it is combined with carbon capture and storage.
So called “Green” LNG is a hoax:
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Outside of select markets that don’t have good pipeline access, the US a whole has a surplus of NG, which is why we are a huge exporter. LPG too. When looking at the “US” you really have to take into account the vast geography and political forces at play. The US is definitely not a monolithic entity regarding energy policy or resources. Not even close. As @ombugge states as well, NG is a fossil fuel like any other, and not carbon neutral. It burns cleaner than, say, the heavy fuel oil burned in much of the international shipping fleet, but it still produces greenhouse gases. Natural gas/methane is a potent ghg itself, albeit one with a shorter half-life than CO2.
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As always there are difference of opinion (interests?) as to the usefulness of LNG as a step towards carbon neutrality in shipping:
PS> Bio-LNG and e-LNG are contradictions in term. If a gas is extracted from Biological materials, or made using renewable energy, it is NOT Natural Gas, no matter in which form. (Gaseous or Liquid)
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I recently recall an article saying 300-400million $ buys a LNG tanker/FSRU from Korea.
Built in the USA, 300-400million buys a small container ship.
How much would a Jones Act LNG tanker cost?!!!???
This is from 2019: Philadelphia Shipyard Fights Again for Its Life - WSJ
Guessing a JA-compliant LNG tanker may go for a billion now. Certainly not less than $900 million.
Don’t forget, just like the tankers built in Philly, assembled in USA with Korean parts.
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Building LNGC’s is very specialized. No matter how cheap, an owner would have to be crazy to pay $1B for a pig in a poke
A USA built Jones Act LNG carrier would be assembled in USA from Korean parts. It would be a Korean design, contain majority Korean subassemblies, and even have the same drawings, toilets, and plumbing fixtures as a Korean built ship.
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The membrane containment system would likely be French designed, just like most LNG carriers built in Korea, or China:
https://gtt.fr/technologies/markiii-systems
There will be no large LNG carrier built in the US, for two reasons: They would be prohibitively expensive (minimum $1.3 Billion), and no one in their right minds would give that large an order to a yard inexperience with building LNGC’s
The reason LNG ships cost much more than conventional tankers is the high prices for the containment system (tanks). These require experienced assembly technicians and equipment which we do not have. Otherwise LNGC’s are like any other tanker.
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Yep. Reminds me of this:
https://www.sanjuanco.com/DocumentCenter/View/1776/LNG-Final-Report-January-2012-PDF
Related: https://www.gao.gov/assets/gao-16-104.pdf
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The ability of US yards aside, (except for the LNG ships Avondale tried to build for El Paso…none of the ships were accepted by El Paso) there is the question,Is there demand to keep a Jone Act LNGC busy? The answer is no. Only the USEC Boston area imports LNG, and then only a few cargoes/year. Not enough to support a $1.3 B ship.
- Not worth it.
Puerto Rico also imports LNG:
https://www.energy.gov/sites/default/files/2023-03/LNG%20Monthly%20December%202022_3.pdf
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You tell me if those cargoes would keep an LNGC employed, even adding the occasional Boston cargoes. I lean more towards American mariners than I do US shipyards. The high cost of building Jones Act tonnage means that several JA trades go unserviced.
A prime example is container feeder ships from the USEC mega-ports to smaller NE ports up to Maine. Now these containers go mostly by truck…But the US shipbuilders would rather see a trade go unserviced than even consider a waiver. Even though they would not be losing business they do not have. Great guys.
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I’m skeptical.
The high cost of building Jones Act tonnage means that several JA trades go unserviced.
Yep.
and who is looking to buy such a vessel? I think our efforts are better served trying to get a small % of oil and LNG cargoes on US Flag ships. This, along with a waiver allowing JA ships to be built overseas to service trades that do not currently exist,
Maybe starting with a smaller LNG carrier that suites the available market?
Here is an example of a 30K Cbm. LNG carrier suitable for shorter voyages:
Or a smaller (18.6K Cbm) but more complex multi-purpose vessel, with both bunkering and regassification facilities:
The latest addition to the small scale LNG fleet cum bunkering vessel is the Haugesund Knutsen:
The idea is available for free, but “design and equipment packets” will cost a bit, although less than to make mistakes and having to scrap newbuilt vessels.