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NGV Transportation Magazine

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Vol. 20 Oct - Dec 2014
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SPECIAL REPORT: FEATURE: ALASKA LNG - No Lessons Learned From Australia ROLLING IN THE DEEP? VOL. 20 | OCT - DEC 2014 NGV TRANSPORTATION MAGAZINE NGV Transportation WORLD’S LARGEST LNG IMPORTER JAPAN: A Perspective On The Future Of Indonesia’s Maritime Industry As We Enter The Golden Age Of Gas
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Page 1: NGV Transportation Magazine

SPECIAL REPORT:

FEATURE:

ALASKA LNG- No Lessons Learned From Australia

ROLLING IN THE DEEP?

VOL. 20 | OCT - DEC 2014

NGVTRANSPORTATION

MAGAZINE

NGV Transportation

WORLD’S LARGEST LNG IMPORTER

JAPAN:

A Perspective On The Future Of Indonesia’s Maritime

Industry As We Enter The Golden Age Of Gas

Page 2: NGV Transportation Magazine
Page 3: NGV Transportation Magazine

1 Vol. 20 Oct - Dec 2014 NGV Transportation

EDITOR’S TWO CENTS

NATURAL GAS GLOBAL

Published by:

Our Address:

Natural Gas Global52 Foch Road, #02-02Singapore 209274

PT Olifen Global Indonesia20th Floor, Wisma KEIAIJl. Jend. Surdirman Kav 3-4Central Jakarta - Indonesia

Managing Director Vincent Choy [email protected]

Chief Editor Rizal Rahman [email protected]

Editor Ryan Pasupathy [email protected]

Business Development Samuel Tan Head of Partnership [email protected]

Stefani Budiman Business Development Manager [email protected]

Marketing Manager Denise Lim [email protected]

Graphic Designer Puspo Aurum [email protected]

All rights reserved. No portion of this publication covered by the copyright herein may be reproduced in any form or means – graphic, electronic, mechanical, photocopying, recording, taping, etc – without the written consent of the publisher. Opinions expressed by contributors and advertisers are not necessarily those of the publisher and editor.

Follow us on our social media platforms to receive the latest natural gas news from around the world!

www.facebook.com/NGVTMag

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@NGVTmag

Here we are at the very end of the year and just how fast it has come at that? As this year comes to a close our eyes are only being opened ZLGHU�WR�WKH�WUXH�SRWHQWLDO�RI�D�JDV�¿OOHG�IXWXUH��7KH�VWDJJHULQJ�DPRXQW�of money being invested into gas infrastructure development is mind EORZLQJ�WR�VD\�WKH�OHDVW��:LWK�XSZDUGV�RI�86�����ELOOLRQ�H[SHFWHG�WR�JR�WRZDUGV�GHYHORSPHQW�WLOO�������WKH�LQGXVWU\�GRHVQ¶W�ORRN�OLNH�LW�LV�JRLQJ�WR�VORZ�GRZQ�DQ\�WLPH�VRRQ��

7KHUH�KDYH�EHHQ�VRPH�FRQFHUQV�DV�WR�SRVVLEOH�RYHUVXSSO\�KRZHYHU��WKLV�has been contested saying that demand has actually been underestimated DV�&KLQD�UHFHQWO\�DQQRXQFHG�WKDW�LWV������IRUHFDVWHG�JDV�RXWSXW�ZRXOG�EH�KDOYHG�IURP�LWV�FXUUHQW�HVWLPDWHV��7KH�FDVH�IRU�RYHUVXSSO\�DOVR�ZRXOG�require some basic metrics implicating that lower demand should WUDQVODWH� LQWR� ORZHU� SULFHV� EXW� RQFH� DJDLQ�� WKLV� KDV� QRW� EHHQ� WKH� FDVH�ZRUOGZLGH�WKRXJK��7KLV�KDV�EHHQ�UHDVRQHG�WR�EH�GXH�WR�WKH�KLJK�FRVW�RI�producing the gas from sites where manpower and operational costs are KLJK�±�VXFK�DV�$XVWUDOLD��

7KHVH�DUH�KRZHYHU��RQO\�VSHFXODWLRQV�DQG�DV�ZLWK�DOO�PDUNHWV�ZH�FDQ�only do our best to understand the fundamental issues associated with WKHLU�ULVH�DQG�IDOO��$�PRUH�FRQFUHWH�ZRUU\�WKDW�LV�NHHSLQJ�D�ODUJH�QXPEHU�RI�JDV�SURIHVVLRQDOV�DZDNH�DW�QLJKW�LV�WKH�HQWLUH�¿DVFR�WKDW�LV�WDNLQJ�SODFH�LQ�&DQDGD�ZLWK�UHJDUGV�WR�WKH�3ULQFH�5XSHUW�/1*�3URMHFW��3HWURQDV�KDV�WKUHDWHQHG�WR�DEDQGRQ�WKH��86���ELOOLRQ�GROODU�SURMHFW�FODLPLQJ�WKDW�WKH�Canadian government is being unrealistic about the time for them to UHYLVH�WD[�DQG�HQYLURQPHQWDO�VWUXFWXUH�IRU�/1*�LQ�WKH�FRXQWU\��7KH\�DUH�concerned that this delay could result in them missing the current LNG PDUNHWLQJ�ZLQGRZ��7KH�%�&��/1*�$OOLDQFH�KDV�FDXWLRQHG� WKH�3UHPLHU��&KULVW\�&ODUN�DJDLQVW�KLJK�WD[HV�DV�WKH\�IHHO�LW�FRXOG�KDYH�GUDVWLF�HHFWV�RQ�WKHLU�FRPSHWLWLYH�FDSDELOLWLHV�LQ�WKH�JOREDO�PDUNHW��

/HW¶V�VNLS�SDVW�WKH�PRXQWLQJ�SUHVVXUH�IRU�D�PRPHQW�DQG�KDYH�D�ORRN�at some of the things we have prepared for you in this issue – we have a FORVH�ORRN�DW�-DSDQ�DQG�DOO�WKH�LQWULFDFLHV�VXUURXQGLQJ�LWV�/1*�LQGXVWU\��from import to production and a special piece on its fast-growing NGV PDUNHW��:H�DOVR�KDYH�VRPH�H[SHUW� LQVLJKW�RQ�WKH�$ODVNDQ�/1*�SURMHFW�DQG�ZK\�LW�PLJKW�QRW�EH�WKH�EHVW�LGHD��DV�ZHOO�DV�DQ�LQ�GHSWK�DQDO\VLV�RI�how Asian nations are diversifying their LNG sources for greater energy VHFXULW\��7KDW¶V�QRW�DOO�WKRXJK��ZH�KDYH�D�IHZ�VSHFLDO�UHSRUWV�IRU�\RX�DV�well – one on CNG storage systems and another on the prospects of LNG DV�D�IXHO�IRU�VHD�ERXQG�YHVVHOV�

$V�DOZD\V�ZH�KRSH�WKDW�WR�NHHS�\RX�LQIRUPHG��UHOHYDQW�DQG�RQ�WRS�RI�\RXU�JDPH��+HOS�XV��KHOS�\RX��E\�OHWWLQJ�XV�NQRZ�PRUH�DERXW�ZKDW�\RX�ZRXOG�OLNH�WR�KHDU��$OO�WKH�EHVW�IRU�WKH�UHPDLQGHU�RI�������NHHS�\RXU�KHDG�KLJK�DQG�SUHVV�RQ�±�WKHUH�LV�PXFK�WR�ORRN�IRUZDUG�WR��

Ryan PasupathyEditor

Greetings all!

Page 4: NGV Transportation Magazine

2NGV Transportation Vol. 20 Oct - Dec 2014

CONTENTS

CNG Stations:Cascade Your Earnings and Buffer Your Losses

.0)�+ORQTV�&KXGTUKƂECVKQP in Asia

Editor’s Two Cents

Contents

An Analysis of National 2QNKEKGU�#PF�+VU�+ORCEV�On NGV Growth in Dhaka, Bangladesh

Rolling in The Deep?A perspective on the future of Indonesia’s Maritime Industry as we nter the golde age of gas

1st Myanmar CNG Forum Transport, Industry and Power Forum 2014

12

32

0102

39

28

36

FEATURE:

SPECIAL REPORTS:

EVENT & EXHIBITION:

NEWS AROUND THE WORLD 03

16JAPAN : WORLD’S LARGEST LNG IMPORTER

ALASKA LNGNo Lessons Learned From Australia33

Page 5: NGV Transportation Magazine

3 Vol. 20 Oct - Dec 2014 NGV Transportation

NEWS AROUND THE WORLD

INDIASeptember 2014: Calcutta Likely To Get LNG Within 2 Years

September 2014: ICF Manfactures Train Running On CNG, Diesel

/1*�PD\�EHFRPH�DYDLODEOH�LQ�&DOFXWWD�ZLWKLQ�WKH�QH[W���years as the Centre formulates a plan to set up a unit at 6DQGKHDGV��7KH�&DOFXWWD�3RUW�7UXVW�KDV�EHHQ�VRXUFLQJ�IRU�LQWHUHVWHG�SDUWLHV�WR�VHW�XS�DQ�)658�DW�6DQGKHDGV�

³:H� KDYH� UHFHLYHG� WKH� QHFHVVDU\� FOHDUDQFHV� IURP�the Centre and the shipping ministry has given us the JR�DKHDG��7KH�DJHQF\�HQJDJHG�ZLOO�DQFKRU�D� ODUJH�WDQN�DW� 6DQGKHDGV�� LQWR� ZKLFK� WDQNHUV� ZLOO� XQORDG� WKHLU�FDUJR�� /1*�ZLOO� EH� VWRUHG� LQ� OLTXLG� IRUP�� 8QGHUZDWHU�SLSHOLQHV� IURP�WKLV� WDQN�ZLOO�FDUU\� LW� WR�+DOGLD�ZKHUH�D�UH�JDVL¿FDWLRQ�XQLW�ZLOO�FRQYHUW�LW�LQWR�JDV��:H�KRSH�WKDW�WKH�SURMHFW�ZLOO�EH�FRPSOHWHG�ZLWKLQ�WZR�\HDUV�´�VDLG�WKH�&DOFXWWD�3RUW�7UXVW�FKDLUPDQ��536�.DKORQ�

7KH�XQLW�ZLOO�FRVW�FRVW�5V�����FURUH��86�����PLOOLRQ��DQG�ZLOO�KDYH�D�FDSDFLW\�RI���PLOOLRQ�WRQQHV�D�\HDU��7KH�project will provide cleaner and cheaper fuel and reduce WKH� FRVW� RI� LQGXVWULDO� SURGXFWLRQ�� ,W� ZLOO� DVVLVW� LQ� WKH�development of the state and facilitate gas based power JHQHUDWLRQ�SURMHFWV�

- The Times of India

, Q W H J U D O�Coach Factory �,&)�� JHQHUDO�PDQDJHU�� $VKRN�.� $JDUZDO�� FXW�the ribbon for WKH� ¿UVW� &1*�Diesel Electrical 0XOWLSOH� 8QLW�� ' ( 0 8 ��

PDQXIDFWXUHG� LQ� &KHQQDL�� 7KH� WUDLQ� KDV� GXDO� IXHO�FDSDELOLWLHV�DQG�FDQ�UXQ�RQ�ERWK�GLHVHO�DQG�&1*�

7KLV�LV�SDUW�RI�,QGLDQ�5DLOZD\V�VWHSV�WR�PDNH�WUDLQV�HQYLURQPHQWDOO\� IULHQGO\� DV� &1*� XVH� LV�� &1*� XVH� LV�DVVRFLDWHG�ZLWK�ORZHU�WR[LF�HPLVVLRQV��7KH�&1*�'(08�FRQVLVWV�RI�D�GULYHU�FDE��DQ�HQJLQH�URRP�DQG�D�UDGLDWRU�room with an additional CNG cascade storage set up at WKH�UHDU�HQG�ZKLFK�FRQWDLQV�VRPH����F\OLQGHUV�HDFK�ZLWK�D�FDSDFLW\�WR�VWRUH���NJV�RI�&1*�DW�����EDU�SUHVVXUH�

- The Times of India

3HWURQDV��0DOD\VLD¶V�VWDWH�UXQ�RLO�DQG�JDV�FRPSDQ\�KDV�WKUHDWHQHG�WR�FDQFHO�LWV�86���ELOOLRQ�/1*�SURMHFW�LQ�%�&��GXH�WR�WD[DWLRQ�DQG�HQYLURQPHQWDO�UHODWHG�REVWDFOHV�WR�WKH�FRQVWUXFWLRQ�RI�WKH�H[SRUW�7HUPLQDO�

6KDPVXO� $]KDU� $EEDV�� &(2� RI� 3HWURQDV�� VDLG� WKDW�WKH\�ZRXOG�DEDQGRQ� WKH� HQWLUH�SURMHFW�XQOHVV� WKH�%�&��JRYHUQPHQW�XQYHLOV�FRPSHWLWLYH�WD[�DQG�UHJXODWRU\�UXOHV�LQ�2FWREHU��0U��6KDPVXO�$]KDU�$EEDV�WROG�WKH�)LQDQFLDO�7LPHV� WKDW� &DQDGD¶V� HRUWV� WR� DWWUDFW� /1*�KDYH� EHHQ�KDPSHUHG�E\�µXQFHUWDLQW\��GHOD\�DQG�VKRUW�YLVLRQ¶��

%�&��JRYHUQPHQW�RFLDOV�KDYH�UHVSRQGHG�E\�VD\LQJ�that it was the LNG company that requested a time H[WHQVLRQ�IRU�WKH�HQYLURQPHQWDO�UHYLHZ�SURFHVV��3DFL¿F�1RUWKZHVW� /1*� UHTXHVWHG� IRU�PRUH� WLPH� WR� ZRUN� RXW�DGMXVWPHQWV� WR� WKH� MHWW\� DQG� WHUPLQDO� DW� /HOX� ,VODQG�WKDW�ZLOO�LQFOXGH�VXEVWDQWLDO�PLWLJDWLRQ�PHDVXUHV��7KHVH�measures are in aim of reducing potential detrimental HHFWV�WR�WKH�PDULQH�KDELWDW�

7KH� &DQDGLDQ� (QYLURQPHQWDO� $VVHVVPHQW�$JHQF\� EURXJKW� WR� WKH� DWWHQWLRQ� WKDW� WKHUH� ZHUH� NH\�LQIRUPDWLRQ�JDSV�UHJDUGLQJ�WKH�FRPSDQ\¶V�SODQV�WR�WXUQ�an uninhabited island into an industrial site that will LQFOXGH�GUHGJH�ZRUN�RI�VRPH�VHYHQ�PLOOLRQ�FXELF�PHWUHV�RI�VHGLPHQW��7KH�DUHD�LV�DOVR�FRQVLGHUHG�D�FULWLFDO�KDELWDW�IRU�YDULRXV�¿VK�VSHFLHV�LQ�WKH�UHJLRQ��

7KH�SURMHFW�FDQQRW�PRYH�IRUZDUG�ZLWKRXW�ERWK�VWDWH�DQG� IHGHUDO� JRYHUQPHQWV� JUDQWLQJ� D� FHUWL¿FDWH�� 7KH�FRPSDQ\�UHTXHVWHG�IRU�DQ�H[WUD����GD\V�WR�UHVSRQG�WR�WKH�FRQFHUQV�WKDW�KDYH�EHHQ�UDLVHG��

- The Globe And Mail

MALAYSIAAugust 2014: Petronas Cites Environmental

Concerns On Prince Rupert LNG Project

Page 6: NGV Transportation Magazine

4NGV Transportation Vol. 20 Oct - Dec 2014

NEWS AROUND THE WORLD

SINGAPORESeptember 2014: Pavilion Energy Signs 20 Year Deal To Buy BP LNG 6LQJDSRUH¶V� YHU\� RZQ� 3DYLOLRQ� *DV�� D� VXEVLGLDU\�RI� 3DYLOLRQ� (QHUJ\�� KDV� VLJQHG� D� GHDO� ZLWK� %3� WR�SXUFKDVH� �������� WRQQHV� RI� /1*� IRU� ��� \HDUV�EHJLQQLQJ� ������ 7KH� /1*� ZLOO� DUULYH� IURP� %3¶V�)UHHSRUW� /1*� IDFLOLW\� LQ� +RXVWRQ�� 7KH� SURMHFW� LV�H[SHFWHG�WR�UHDFK�),'�E\�HQG������

3DYLOLRQ�ZLOO�WDNH�DGYDQWDJH�RI�D�FKDQJH�LQ�IRFXV�IURP� ORQJ� WHUP�JDV� FRQWUDFWV� WR� D� VSRW�PDUNHW� LQ�6LQJDSRUH�DV�ZHOO�DV�WKH�DGGLWLRQ�RI�PRUH�LPSRUW�H[SRUW� WHUPLQDOV� DQG� VWRUDJH� IDFLOLWLHV�ZKLFK�ZLOO�begin the long process of establishing an Asian /1*�KXE�

³7KLV� GHDO� LV� SDUW� RI� RXU� FRQWLQXHG� HIIRUW� WR�enhance and diversify our LNG portfolio to deliver VXVWDLQDEOH�DQG�FRPSHWLWLYH�/1*�VXSSO\�WR�$VLD�´�&(2� RI� 3DYLOLRQ� (QHUJ\� DQG� 3DYLOLRQ� *DV�� 6HDK�0RRQ�0LQJ�VDLG�

- Petro Global News

PHILIPPINESSeptember 2014: Philippine Government Should Bankroll Planned LNG Terminal$FFRUGLQJ�WR�,QWHUQDWLRQDO�)LQDQFH�&RUS��WKH�3KLOLSSLQHV�JRYHUQPHQW� ZLOO� KDYH� WR� EDQNUROO� WKH� ODWHVW� SODQQHG�/1*� WHUPLQDO�� -HVVH� $QJ�� ,)&� 3KLOLSSLQHV� UHVLGHQW�UHSUHVHQWDWLYH��WROG�UHSRUWHUV��³7KH�JRYHUQPHQW�VKRXOG�XQGHUVWDQG� WKHLU� UROH�� LI� WKH\� WKLQN� /1*� LV� LPSRUWDQW�WKHQ�WKH\�QHHG�WR�GR�VRPHWKLQJ�WR�KHOS�EULQJ�LW�LQ�´�$QJ�went on to say that the government needs to decide if it ZLOO�WDNH�D�SURGXFWLYH�UROH�DQG�LQYHVW�LQ�WKH�GHYHORSPHQW�

³7KH� SUREOHP� LV� HQWU\� FRVW�� ,I� \RX� DUH� JRLQJ� WR�DVN�RQH�SULYDWH�VHFWRU�WR�GR� LW�� LW¶V� WRR�PXFK�EHFDXVH�RQFH�WKH\�GR�LW��HYHU\ERG\�ZLOO�EHQH¿W��6R��WKLV�LV�RQH�ZKHUH�\RX�QHHG�WKH�SXEOLF�SROLF\�SDUW��ZKHUH�\RX�QHHG�JRYHUQPHQW�WR�VHUYH�DV�RU�EH�SDUW�RI�LW�¿QGLQJ�ZD\V�WR�EULQJ�LW�LQ�´�$QJ�VDLG��

$PRQJ� RWKHU� WKLQJV�� $QJ� DOVR�PHQWLRQHG� WKDW� WKH�Philippines needs to prepare for the eventual depletion RI�WKH�0DODPSD\D�*DV�)LHOG�LQ�1RUWKZHVW�3DODZDQ��$Q�LNG terminal will help facilitate imports and allow for UHJDVL¿FDWLRQ�DQG�UHGLVWULEXWLRQ�WKURXJK�SLSHOLQHV�

- Interasksyon.com

INDONESIA September 2014: Government Mulls Raising CNG Price To Stimulate Market GrowthSeptember 2014: Pertamina Seeks US LNG

Supply, shale equity7KH� ,QGRQHVLDQ� JRYHUQPHQW� LV�considering raising the price of CNG LQ� WKH� FRXQWU\� DV� D� SOR\� WR� PDNH�gas refuelling stations an attractive LQYHVWPHQW�IRU�WKH�SULYDWH�VHFWRU��(G\�+DUPDQWR��7KH�(QHUJ\�DQG�0LQHUDO�5HVRXUFHV� 0LQLVWU\¶V� 'LUHFWRU�*HQHUDO�IRU�2LO�DQG�*DV��VDLG�WKDW��WKH�ministry was planning to formally suggest that the Coordinating Economic Minister raise the price of &1*� IURP�5S� ������ ����86� FHQWV��SHU�OLWHUV�RI�JDVROLQH�HTXLYDOHQW��OJH��WR�DURXQG�5S�����������86�FHQWV��

Edy went on to say that this will help increase interest in the private sector to build more gas infrastructure and convert regular ¿OOLQJ� VWDWLRQV� WR� RQHV� ZLWK� JDV�GLVSHQVLQJ� FDSDELOLWLHV�� � (G\� KDV�hopes that this move will create a shift to an alternative energy source IRU�WUDQVSRUWDWLRQ�

- The Jakarta Post

3HUWDPLQD� LV� ORRNLQJ� WR� WU\�secure a larger supply of /1*� IURP� WKH� 8QLWHG� 6WDWHV�by buying into a shale gas SURGXFHU� WKHUH�� 7KLV� FRPHV� DV�the company is trying to fill gaps that have surfaced from declining domestic output and KLJKHU�GHPDQG�

Pertamina has already announced that it will be SXUFKDVLQJ� ����PLOOLRQ� WRQQHV� RI�LNG a year from Cheniere Energy EHJLQQLQJ�������7KH� FRPSDQ\� LV�further negotiating purchase of DQ� DGGLWLRQDO� �� PLOOLRQ� WRQQHV�IURP�DQRWKHU�SURMHFW�

$V� WKH� FRXQWU\¶V� GRPHVWLF�UHVHUYHV� GHFOLQH�� ,QGRQHVLD�KDV� EHHQ� PDNLQJ� DWWHPSWV� WR�OLPLW� H[SRUWV� LQ� UHFHQW� \HDUV��UHGLUHFWLQJ�H[SRUWV�IRU�GRPHVWLF�

XVH��7KH�FRXQWU\¶V�/1*�RXWSXW�LV�H[SHFWHG� WR� ULVH� WR����� FDUJRHV�WKLV�\HDU��([SRUWV�KRZHYHU��ZLOO�UHPDLQ�VWHDG\�DW�����FDUJRHV�

3HUWDPLQD¶V�YLFH�SUHVLGHQW�RI�/1*� 'LGLN� 6DVRQJNR� :LGL� KDV�VDLG� WKDW� E\� ����� WKH� FRXQWU\�will need to import and that H[LVWLQJ� VXSSO\� FRQWUDFWV� ZLOO�KDYH�WR�EH�H[WHQGHG�E\�QR�PRUH�WKDQ� RQH� \HDU� DW� D� WLPH�� +H�DGGHG� WKDW� DV� SDUW� RI� WKH� SODQ��the company will also set up an /1*� WUDGLQJ� GHVN� LQ� 6LQJDSRUH�that will trade physical cargoes and move on to financial KHGJLQJ�LQ�WKH�IXWXUH�

- Reuters

Page 7: NGV Transportation Magazine

5 Vol. 20 Oct - Dec 2014 NGV Transportation

NEWS AROUND THE WORLD

377�LV�FRQGXFWLQJ�D�IHDVLELOLW\�VWXG\�LQWR�WKH�FRQVWUXFWLRQ�RI�DQ�/1*�WHUPLQDO�ZLWK�DQ�DQQXDO�FDSDFLW\�RI���PLOOLRQ�WRQQHV�LQ�0\DQPDU�WR�IDFLOLWDWH�RQVKRUH�/1*�WUDQVSRUWDWLRQ�WR�7KDLODQG�

7KH�IDFLOLW\�LV�VHW�WR�EH�EXLOW�FORVH�WR�WKH�'DZHL�,QGXVWULDO�=RQH�ZKHUH�LW�FDQ�EH�FRQQHFWHG�WR�GLVWULEXWLRQ�SLSHOLQHV�IRU�GLVWULEXWLRQ�WR�<DGDQD��<HWDNXQ�DQG�=DZWLND�JDV�¿HOGV��377�KRSHV�WR�JR�DKHDG�ZLWK�WKH�SURMHFW�HYHQWKRXJK�WKH�government is still deciding on the location for its third phase LNG terminal LQ�7KDLODQG�

377�FXUUHQWO\�KDV�D�¿UVW�SKDVH�/1*�WHUPLQDO�ZLWK�DQ�DQQXDO�FDSDFLW\�RI���PLOOLRQ�WRQQHV�SHU�DQQXP�DW�0DS�7D�3KXW��5D\RQJ��ZLWK�D�VHFRQG�SKDVH�/1*�WHUPLQDO�FORVH�E\�ZLWK�VLPLODU�FDSDFLW\��)RU�WKH��UG�SKDVH��WKH�(QHUJ\�0LQLVWU\�ZDQWV�377�WR�ORRN�IRU�D�VHSDUDWH�ORFDWLRQ�WR�EXLOG�DQRWKHU�/1*�WHUPLQDO�

7KH� (OHFWULFLW\� *HQHUDWLQJ� $XWKRULW\� RI� 7KDLODQG� DQG� 5DWFKDEXUL�(OHFWULFLW\�*HQHUDWLRQ�+ROGLQJ�ERWK�KDYH�VDLG�WKDW�WKH\�ZRXOG�OLNH�WR�LPSRUW�/1*�WR�JHQHUDWH�SRZHU�DW�WKHLU�SODQWV�

- The Nation

MYANMAR BANGLADESH

PAKISTAN

September 2014: PTT Plans Distribution Hub For LNG In Myanmar September 2014: Scrap CNG For Private Cars

August 2014: ECC May Approve LNG Allocation For CNG Industry

%DQJODGHVK� LV� VHHNLQJ� ZD\V� WKDW�it can allocate its own energy VRXUFHV� PRUH� HFLHQWO\�� 7KH�country has decided that it would be best to scrap costly subsidies for diesel and electricity as they DUH� ZDVWHIXO� RI� WD[SD\HU� GROODUV�and contradictory to the goal of ERRVWLQJ�HQHUJ\�SURGXFWLRQ��

CNG for private cars will need to be stopped as gas is a precious resource to the country and its use should be limited to providing power for the industry DQG�VXSSRUWLQJ�SXEOLF�WUDQVSRUW��,W�LV� IHOW� WKDW�SHRSOH�ZKR� FDQ�DRUG�to buy cars should be able to pay IRU�IXHO�DW�WKH�FRUUHFW�PDUNHW�UDWH�ZLWKRXW�WKH�KHOS�RI�VXEVLGLHV�

%DQJODGHVK¶V� SHU� FDSLWD�emissions of greenhouse gases are relatively low so that by restricting &1*�XVH�IRU�SULYDWH�FDUV��LW�ZLOO�QRW�KDYH�PXFK�RI�DQ�HHFW�RQ�WKH�RYHUDOO�air quality as there are not too many SULYDWH� FDU� RZQHUV�� ,W� LV� HVVHQWLDO�for the government to review all aspects of energy pricing so that non-renewable resources are used DV�HFLHQWO\�DV�SRVVLEOH�

- Dhaka Tribune

7KH� (FRQRPLF� &RRUGLQDWLRQ� &RPPLWWHH� �(&&��LV� OLNHO\� WR� FOHDU� WKH� ZD\� IRU� D� SODQ� WR� DOORFDWH�some LNG imports to CNG filling stations to save GRPHVWLF� QDWXUDO� JDV� IRU� SRZHU� SODQWV�� 7KH� SODQ�ZLOO�KHOS�GLYHUW�����PLOOLRQ�FXELF�IHHW�RI�QDWXUDO�JDV�per day to power plants as a means to try increase electricity production and curb long outages that KDYH�UHGXFHG�HFRQRPLF�JURZWK�E\����HDFK�\HDU�

Petroleum and Natural Resources Minister 6KDKLG� .KDTDQ� $EEDVL� KDV� VDLG� WKDW� D� SODQ� LV�underway to supply LNG to CNG stations with VRPH� LQFHQWLYHV�� 2IILFLDOV� RI� WKH� SHWUROHXP�PLQLVWU\� KDYH� PDGH� NQRZQ� WKDW� WKH� JRYHUQPHQW�

wants to provide a cushion to the CNG industry WKURXJK�WKH�XVH�RI�/1*�

7KH�PLQLVWU\� KDV� DOVR� VHW� RXW� D� SODQ� RI� ILVFDO�LQFHQWLYHV� LQFOXGLQJ� H[HPSWLQJ� LPSRUWHG�/1*� IURP� VDOHV� WD[HV� DQG� *DV� ,QIUDVWUXFWXUH�'HYHORSPHQW� &HVV� �*,'&�� LQ� DLG� RI� NHHSLQJ� LW�DIIRUGDEOH�DQG�NHHSLQJ�D�����GLIIHUHQFH�EHWZHHQ�SULFHV� RI� SHWURO� DQG� &1*�� &XUUHQWO\�� DOO� EXON�EX\HUV�RI�QDWXUDO�JDV�DUH�SD\LQJ�*,'&�DW�WKH�UDWH�RI� 5V���� ��86������ SHU� PLOOLRQ� %ULWLVK� WKHUPDO�XQLWV��PPEWX��DQG�����VDOHV�WD[�

- The Express Tribune

Page 8: NGV Transportation Magazine

TEL: +65 6506 0965 | FAX: +65 6729 7293 | EMAIL: [email protected]

IN PARTNERSHIPWITH

SPONSORED BY: ORGANIZED BY:MEDIA PARTNERS:

CONTINUOUS PUSH TO UTILIZE NATURAL GAS AND LNG BY FASTRACKING LNG SUPPLY IMPORTS AND INFRASTRUCTURE DEVELOPMENT

WORKSHOP A: LNG 101: INTRODUCTION TO LNG BUSINESSWORKSHOP B: LNG AS A FUEL AND THE EMERGENCE OF SMALL/MEDIUM SCALE LNG

For the Philippines – which is currently one of Asia's fastest-growing economy –, importing LNG is only a question of when and how, and no longer if. To prepare for the energy future of the Philippines – especially with the inevitable decline of Malampaya–, this forum will continue to lay the groundwork for the establishment of a natural gas master-plan incorporating the entire value chain which is anticipated to be announced end 2014. Taking the theme, “Continuous Push to Utilize Natural Gas and LNG by Fast Tracking LNG Supply Imports and Infrastructure Development”, the timely 2nd LNG SUPPLY, TRANSPORT & STORAGE PHILIPPINES 2014 will continue to addresses issues with LNG imports and infrastructure developments that will definitely be taking place in the Philippines and the region. This is the perfect opportunity for all serious stakeholders to highlight potential opportunities for development and establish their position in the upcoming LNG boom.

WWW.LNG-WORLD.COM/LNG_PHIL2014/

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7 Vol. 20 Oct - Dec 2014 NGV Transportation

NEWS AROUND THE WORLD

CHINA

JAPAN

August 2014: Shell Sees China LNG For Transport Outpacing US, Canada

September 2014: Tokyo Gas In No Hurry To Buy New LNG From Russia Due To Sanctions

$FFRUGLQJ� WR�6KHOO�� WKH�/1*� IRU�WUDQVSRUW� PDUNHW� LV� JURZLQJ�IDVWHU�LQ�&KLQD�WKDQ�LQ�WKH�86�DV�more Chinese drivers are buying QHZ� YHKLFOHV� WKDW� GRQ¶W� KDYH� WR�EH�UHWURILWWHG��6KHOO�KDV�UHFHQWO\�trimmed its pilot Green Corridor project in Canada to fuel long KDXO�WUXFNV�ZLWK�/1*��

7KH�FRPSDQ\� LV�HYDOXDWLQJ� LWV�options to develop the business in China which already has more WKDQ���������YHKLFOHV�UXQQLQJ�RQ�/1*��-RKQ�$EERW��6KHOO¶V�KHDG�RI�UH¿QLQJ�KDV�VDLG�WKDW�WKH�&KLQHVH�PDUNHW�LV�PRYLQJ�YHU\�IDVW�DQG�LQ�1RUWK�$PHULFD��WKH\¶OO�HLWKHU�KDYH�WR� SD\� UHWUR¿WWLQJ� FRVWV� RU� ZDLW�XQWLO�WKH�YHKLFOH�H[SLUHV�

- Bloomberg Businessweek

7RN\R�*DV�� LV�QRW� LQ� DQ\� UXVK� WR� FRPPLW� WR�PRUH�deals with Russia due to sanctions according to WKH� FRPSDQLHV� 9LFH� &KDLUPDQ�� 6KLJHUR� 0XUDNL��7KH� ELJJHVW� LPSRUWHU� RI� /1*� LQ� WKH� ZRUOG� JHWV��DERXW�����RI�LWV�JDV�IURP�5XVVLD�ZKLFK�DPRXQWHG�WR� DOPRVW� ���� RI� WRWDO� /1*� VDOHV� IURP� 5XVVLD¶V�6DNKDOLQ���/1*�SODQW�ODVW�\HDU�

Russia plans to add another two more LNG SODQWV� WRZDUGV� WKH� HQG� RI� WKH� GHFDGH�� SOXV� DQ�H[WHQVLRQ� RI� WKH� 6DNKDOLQ��� SURMHFW�� :KHQ� DVNHG�ZKHWKHU�7RN\R�*DV�ZRXOG�SXUFKDVH� DQ\�JDV� IURP�WKH�QHZ�5XVVLDQ�SURMHFWV��*D]SURP¶V�9ODGLYRVWRN�/1*�DQG�5RVQHIW�([[RQ0RELO¶V�SODQW�RQ�6DNKDOLQ��0XUDNL� VDLG�� ³$W� WKLV� PRPHQW�� �EHFDXVH�� RI� WKH�VHQVLWLYLW\�RI� WKH�VDQFWLRQV��SUREDEO\�EHIRUH�VRPH�resolution comes out for the sanctions it is a bit GLIILFXOW�IRU�XV�WR�PDNH�QHZ�FRPPLWPHQWV�´

- Reuters

AUSTRALIASeptember 2014: Australian LNG Contracts Under Pressure From US, Russia Supply

$FFRUGLQJ� WR� %+3� %LOOLWRQ� /WG�� H[HFXWLYH� $OEHUWR� &DOGHURQ��Australian LNG producers could face pressure causing them to UHWKLQN� WKHLU� ORQJ� WHUP�VDOHV�FRQWUDFWV�DV� ODUJH�DPRXQWV�RI� FKHDS�JDV�IORRGV�$VLD�

7KH� 86� DQG� 5XVVLD� DUH� GHYHORSLQJ� SURMHFWV� ZLWK� FDSDFLW\� WR�SURGXFH�VRPH�����PLOOLRQ�WRQQHV�SHU�\HDU�ZKLFK�ZLOO�EH�UHVSRQVLEOH�IRU�GHWHUPLQLQJ�WKH�ORQJ�WHUP�/1*�SULFHV�IRU�&KLQD��DGGHG�&DOGHURQ�ZKR�LV�DOVR�D�ERDUG�PHPEHU�RI�2ULFD�/WG�

&KHQLHUH� (QHUJ\� DQG� 6HPSUD� (QHUJ\� DUH� DPRQJ� VRPH� RI� WKH�SOD\HUV�ZKR�KDYH�D�NHHQ�LQWHUHVW�WR�WDS�WKH�86�VKDOH�ERRP�DQG�EXLOG�/1*� H[SRUW� SURMHFWV� WKDW�ZLOO� FRPSHWH�ZLWK�$XVWUDOLDQ� VXSSOLHUV��$FFRUGLQJ� WR�&DOGHURQ��5XVVLD�ZLOO�EH�DEOH� WR� VXSSO\�JDV�DW�DERXW�����SHU�PLOOLRQ�%ULWLVK�WKHUPDO�XQLWV��FRPSDUHG�ZLWK��������WR�����IRU�$XVWUDOLDQ�SURGXFHUV�

&DOGHURQ�DOVR�ZHQW�RQ�WR�VD\�WKDW��³:KDW�LV�FOHDU�LV�WKDW�$XVWUDOLD�ZLOO� EHFRPH� D�PDMRU� SURGXFHU� RI� /1*�� WKH� SUREOHP� LV� WKDW�PRVW�Australian LNG production sits on the right hand side of the cost FXUYH��&RQWUDFWHG�WRQQHV�ZLOO�EH�XQGHU�SUHVVXUH�´�

- Bloomberg

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8NGV Transportation Vol. 20 Oct - Dec 2014

NEWS AROUND THE WORLD

EGYPTIRAQ

TANZANIA

September 2014: Egypt Puts Back First LNG Import Terminal Start To December

September 2014: Iran Plans To Build Ten CNG Stations In Iraq

Discovery In Tanzania Adds Fuel For LNG Export Plant

September 2014: BG Group

Egypt is set to complete an LNG import terminal by 'H F HPE H U ��7KH� SURMHFW�has actually been further delayed for a n o t h e r PRQWK��KDYLQJ�H[SHFWHG� WR�be completed E\� 1RYHPEHU��

&XUUHQWO\�WKH�FRXQWU\�LV�DEOH�WR�H[SRUW�/1*�EXW�LV�XQDEOH�WR�LPSRUW�LW�ZLWKRXW�KDYLQJ�D�WHUPLQDO�WR�IDFLOLWDWH�LPSRUWV��

7KH�WHUPLQDO�KDV�DOUHDG\�IDFHG�PXOWLSOH�GHOD\V�IRU�PRUH�WKDQ���\HDUV�QRZ��(J\SW¶V�RLO�PLQLVWU\�DQG�1RUZD\¶V�+RHJK�/1*�VDLG�LQ�0D\�WKDW�WKH\�KDYH�DJUHHG�IRU�(J\SW�WR�XVH�RQH�RI�+RHJK�/1*¶V�)658�IRU���\HDUV�

Gas is in short supply due to declining domestic production forcing the JRYHUQPHQW�WR�XVH�JDV�WKDW�KDV�EHHQ�SODQQHG�WR�EH�H[SRUWHG�IRU�GRPHVWLF�XVH��7KLV�KDV�LQFUHDVHG�(J\SW¶V�GHEW�WR�IRULJQ�HQHUJ\�FRPSDQLHV�ZKR�KDYH�ORVW�JDV�VXSSOLHV�WKURXJK�WKH�FRXQWU\¶V�SRRU�PDQDJHPHQW�RI�WKH�VLWXDWLRQ�

- Ahram Online

1DWLRQDO� ,UDQLDQ� 2LO� 3URGXFWV�Distribution Company has said that the construction of stations will start once the SLSHOLQH� FDUU\LQJ� ,UDQLDQ� JDV�WR� ,UDT� EHFRPHV� RSHUDWLRQDO� E\�0DUFK� ������ 7KH� FRPSDQ\� KDV�mentioned that the project will EH�FDUULHG�RXW�E\�,UDQLDQ�SULYDWH�DQG�VWDWH�UXQ�FRPSDQLHV�

%DVHG�RQ�D�UHFHQW�DJUHHPHQW�signed between the two FRXQWULHV����PLOOLRQ�FXELF�PHWUHV�per day will be delivered to ,UDT� LQ� WKH� ILUVW� SKDVH�� ,UDQ�intends to enhance production by investments both foreign and domestic with particular DWWHQWLRQ� WR� WKH� 6RXWK�3DUV�*DV�Field which is estimated to hold ��� WULOOLRQ� FXELF� PHWHUV� RI� JDV�DQG� ��� ELOOLRQ� EDUUHOV� RI� JDV�FRQGHQVDWH�

- PressTV.ir

%*�*URXS�KDYH�GLVFRYHUHG� D�QDWXUDO� JDV�ZHOO� RII�7DQ]DQLD� DGGLQJ� UHVHUYHV� IRU� D� SODQQHG� H[SRUW�SODQW� LQ� WKH� FRXQWU\�� 7KH�.DPED���ZHOO� KDV� �����WULOOLRQ�FXELF�IHHW�RI�JDV�DFFRUGLQJ�WR�2SKLU�(QHUJ\��

%*�SODQV�WR�EXLOG�D�SODQW�LQ�7DQ]DQLD�WR�H[SRUW�/1*�WR�$VLD��7KH�JRYHUQPHQW� LV�DVVHVVLQJ�ZKHUH�they should place the plant while the parliament goes over legislative issues to ensure that the gas SODQW�ZLOO�FRQWULEXWH�WR�WKH�HFRQRP\�

7KH� ZHOO� LV� WKH� ��WK� GLVFRYHU\� E\� WKH� ��companies in the area and is the final project in WKH�GULOOLQJ�FDPSDLJQ��

- Bloomberg

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9 Vol. 20 Oct - Dec 2014 NGV Transportation

NEWS AROUND THE WORLD

MOZAMBIQUESeptember 2014: Mozambique Seeks Pipeline Study For Decades Biggest Gas Finds

0R]DPELTXH� LV� FXUUHQWO\�searching for consultants to study the possibility of building a SLSHOLQH�WR�OLQN�LWV�PDVVLYH�QDWXUDO�gas discoveries to neighbouring $IULFDQ� FRXQWULHV�� 7KH� 0LQHUDO�Resources Ministry has said that it will pay for pre-feasibility VWXGLHV� ZLWK� ¿QDQFLQJ� IURP� WKH�:RUOG�%DQN��7KH\�ZHQW�RQ�WR�VD\�WKDW�´7KH�SODQ�QHHGV�WR�DVVHVV�WKH�SRWHQWLDO� PDUNHW� IRU� QDWXUDO� JDV�LQ�0R]DPELTXH�DQG�RWKHU�QDWLRQV�LQ� VRXWKHUQ� $IULFD�� ³LQFOXGLQJ�LVODQG�FRXQWULHV�´

7KH� SLSHOLQH� ZLOO� VWDUW� LQ�3DOPD�� LQ� WKH� IDU� QRUWK� ZKLFK�is nearest to the recent gas GLVFRYHULHV� LQ� 5RYXPD� %DVLQ�WKDW� KDV� WKH� SRWHQWLDO� WR� PDNH�0R]DPELTXH� WKH� ZRUOG¶V� �UG�ODUJHVW�H[SRUWHU�RI�/1*�

,Q� -XQH�� WKH� JRYHUQPHQW�adopted a master plan that SURYLGHV� IRU� D� SLSHOLQH� QHWZRUN�WKDW�ZLOO�UXQ�WKH�FRXQWU\¶V�OHQJWK�and supply numerous industrial and power generation sectors in

RUSSIA

IRAN

September 2014: Yamal LNG Project May Tap Wealth Fund In 2014

September 2014: Iran Launches Mideast’s Largest LNG Storage Facility

Russia may be able to obtain IXQGV�IURP�WKH�1DWLRQDO�:HDOWK�)XQG� �1:)�� IRU� LWV� <DPDO�LNG Project by the end of this year according to one of the FRXQWU\¶V� PLQLVWHUV� DV� SDUW�RI� WKH� JRYHUQPHQW¶V� SODQV� WR�assist companies affected by WKH�UHFHQW�ZHVWHUQ�VDQFWLRQV�

1RYDWHN�KDV�VHHQ�LWV�DELOLW\�WR�UDLVH� IXQGV� LQ�ZHVWHUQ�PDUNHWV�significantly more difficult due

,UDQ� KDV� DQQRXQFHG� LWV� ODXQFK�RI� WKH� 0LGGOH� (DVW¶V� ODUJHVW�LNG gas storage facilities in the FRXQWU\¶V� QRUWKHDVW� ERUGHULQJ�FRXQWU\�7XUNPHQLVWDQ��7KH�/1*�IDFLOLW\��6KRXULMHK�ZLOO�EH�DEOH�WR�VXSSO\� ���� ELOOLRQ� FXELF� PHWUHV�RI� QDWXUDO� JDV�� 7KH� IDFLOLW\� ZLOO�SURYLGH����PLOOLRQ�FXELF�PHWUHV�of natural gas storage per day in winter and half that amount LQ�VXPPHU�

,UDQ� LV� FXUUHQWO\� WKH� 0LGGOH�(DVW¶V� OHDGHU� ZKHQ� LW� FRPHV� WR�QDWXUDO� JDV� VWRUDJH� FDSDFLW\��7KH�FRXQWU\�DOVR�KDV�WKH�ODUJHVW�YROXPH� RI� WUDGH� H[FKDQJH� ZLWK�7XUNPHQLVWDQ� DIWHU� 5XVVLD��7KH� FRXQWU\� KROGV� VRPH� RI� WKH�ZRUOG¶V�PRVW� DEXQGDQW�GHSRVLWV�DW�DQ�HVWLPDWHG����PLOOLRQ�FXELF�PHWUHV�RI�JDV�UHVHUYHV�

- Turkish Weekly

WKH�FRXQWU\�7KH� FRXQWU\� LV� ERUGHUHG� E\�

RWKHU� FRXQWULHV� VXFK� DV� 6RXWK�$IULFD�� 6ZD]LODQG�� =LPEDEZH��0DODZL��&RQJR�DQG�7DQ]DQLD�ZLWK�the islands of Madagascar and the &RPRURV�QRW�WRR�IDU�DZD\�

- Bloomberg Businessweek

to being placed on the western sanctions list over Moscows UROH� LQ� WKH� 8NUDLQH� &ULVLV��7KH� JRYHUQPHQW� KDV� KRZHYHU��pledged to support sanction hit companies by having the 1:)�SXUFKDVH�ERQGV�LVVXHG�E\�DIIHFWHG�ILUPV�

- Reuters

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10NGV Transportation Vol. 20 Oct - Dec 2014

NEWS AROUND THE WORLD

LITHUANIA

FINLAND

August 2014: Lithuania Breaks Gazprom’s Monopoly By Signing First LNG Deal

September 2014: Finland Will Build Three New LNG Terminals

Lithuania who is fully dependant on gas imports IURP�*D]SURP�KDV� VLJQHG� LWV� ILUVW� FRQWUDFW�ZLWK�1RUZD\¶V� 6WDWRLO� IRU� VXSSO\� RI� /1*�� /LWJDV��/LHWXYRV� (QHUJLMD¶V� WUDGLQJ� DUP� KDV� VLJQHG� D� ��\HDU� GHDO� ZLWK� 6WDWRLO� IRU� /1*� VXSSO\� YDOXHG� DW�����±�����PLOOLRQ�HXURV�

6WDWRLO� LV� WR� GHOLYHU� ����PLOOLRQ� FXELF�PHWUHV� RI�JDV�WR�.DOSHLGD�WHUPLQDO�SHU�\HDU��7KH�IDFLOLW\�LV�GXH�

)LQODQG¶V�(FRQRPLF�0LQLVWU\�KDV�announced that it has committed ¼����� PLOOLRQ� �86���� PLOOLRQ�in energy subsidies for three OLTXHILHG� QDWXUDO� JDV� WHUPLQDOV��7KH�WKUHH�WHUPLQDOV�ZLOO�EH�EXLOW�E\� 0DQJD� /1*�� 6NDQJDVV� DQG�2\� $JD� $E�� LQ� 7RUQLR�� 3RUL� DQG�5DXPD�UHVSHFWLYHO\�

7KH� JRYHUQPHQW� KRSHV� WKH�move will reduce the industrial

use of fuel oil and LPG in the FRXQWU\�� $FFRUGLQJ� WR� WKH�decree signed by the economic PLQLVWU\�� WKH� WKUHH� RSHUDWLRQV�ZLOO� VHH� PRUH� WKDQ� ¼����PLOOLRQ��86�����PLOOLRQ��EHLQJ�LQYHVWHG�LQWR�/1*�WHUPLQDOV�

Minister of Economic $IIDLUV� -DQ� 9DSDDYXRUL� VDLG�WKDW�� ³7KLV� ZLOO� WKHQ� LQVWLJDWH�WKH� GHYHORSPHQW� RI� D� QHWZRUN�

of terminals along the Finnish FRDVWOLQH�´� 7KLV� LV� LQ� DLG� RI�trying to reduce reliance on energy imports from Russia following the recent crisis EHWZHHQ�WKH�(8�DQG�0RVFRZ�

- World Bulletin

WR� EH� ODXQFKHG� LQ�'HFHPEHU�� /LWKXDQLD� LV� SODQQLQJ�WR� LPSRUW� �� ELOOLRQ� FXELF�PHWHUV� RI� JDV� WKURXJK� WKH�WHUPLQDO�LQ�LWV�¿UVW�\HDU�RI�RSHUDWLRQ�ZLWK�DQ�DQQXDO�FDSDFLW\� WR�EH� LQFUHDVHG�WR���ELOOLRQ�FXELF�PHWHUV� LQ�WKH�IXWXUH�

)RUPHU� /LWKXDQLDQ� HQHUJ\� PLQLVWHU�� -DURVODZ�1HYHURYLþ�VDLG�ODVW�\HDU�WKDW����WR�����RI�KLV�FRXQWU\¶V�JDV�QHHGV�ZLOO�FRPH�IURP�WKH�QDWLRQDO�/1*�WHUPLQDO��Another larger LNG terminal is to be built for the QHHGV�RI�/LWKXDQLD�DQG� LWV�%DOWLF�QHLJKERXUV��/DWYLD�DQG�(VWRQLD�

- Euractiv.com

Page 13: NGV Transportation Magazine
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12NGV Transportation Vol. 20 Oct - Dec 2014

FEATURE ARTICLE

Cascade Your Earnings and Buffer Your Losses

CNG Stations

Pondering upon the cost savings that could be made by converting \RXU� ÀHHW� WR� UXQ� RQ�&1*"� 2U� SHUKDSV�

\RX� UHDG� VRPHWKLQJ�� VRPHZKHUH��that told you it might be a good cost savings idea? A major FRQVLGHUDWLRQ� ZKHQ� ORRNLQJ� DW�conversion is the availability of H[LVWLQJ� LQIUDVWUXFWXUH�� ,W� LV� DQ�essential element required for WKH� VXFFHVV� RI� WKH� RSHUDWLRQ�� 7KLV�leads to the question – Can it be worth your while building your own ¿OOLQJ�VWDWLRQ�WR�VXSSRUW�\RXU�ÀHHW"��:KLOH� WKLV� TXHVWLRQ� PD\� QRW� EH�LPPHGLDWHO\� DQVZHUDEOH�� ZH� KRSH�to provide you with some technical information that will assist you in deciding if constructing your own ¿OOLQJ�VWDWLRQ�LV�ULJKW�IRU�\RX�

7KHUH�DUH�VRPH�FOHDU�EHQH¿WV�WR�KDYLQJ� \RXU� RZQ� UH¿OOLQJ� VWDWLRQ��)LUVW�RI�DOO��LW�JLYHV�\RX�D�GHJUHH�RI�freedom such that you need not rely RQ�VRPHRQH�HOVH�WR�REWDLQ�\RXU�IXHO��7KH� &1*� ZLOO� EH� DYDLODEOH� WR� \RX�as soon as you have the station set XS��6HFRQGO\��SURGXFWLRQ�FRVWV�ZLOO�be reduced as you can bypass the WKLUG�SDUW\�PDUN�XS�EX\LQJ�LW�IURP�VRPHRQH� HOVH�� /DVWO\�� LW� DOORZV� IRU�WRWDO�FRQWURO�RI�FXVWRPL]DWLRQ�RI�WKH�VWDWLRQ� ±� WKH� QXPEHU� RI� ¿OO� SRVWV��whether or not your station will be open to the public and the type of GLVSHQVHUV�� ZLOO� DOO� EH� XQGHU� \RXU�GLUHFW�FRQWURO��

8QIRUWXQDWHO\�� WKLV� OLEHUDWLRQ�only leads to more unanswered

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13 Vol. 20 Oct - Dec 2014 NGV Transportation

FEATURE ARTICLE

questions and a long list of GHFLVLRQV� WR� EH� PDGH��:RUU\� QRW�WKRXJK�� :H� DUH� UHDG\� WR� LPSDUW�VRPH� XVHIXO� NQRZOHGJH� RQ� WKH�VXEMHFW�� WKDW� ZLOO� DVVLVW� \RX� LQ�understanding your options and ¿QGLQJ� RXW� ZKLFK� RI� WKHVH� ZRXOG�EH�PRVW�VXLWDEOH�IRU�\RX�

2�7R�WKH�'LVSHQVDU\2QH� RI� WKH� ¿UVW� FKRLFHV� WKDW�will present itself is the type of dispensing system that will be used at the station - dispensers can either EH�7LPH�)LOO�RU�)DVW�)LOO��7KLV�FKRLFH�RI� FRXUVH�� LV� GHSHQGHQW� RQ� VHYHUDO�factors such as the number and type RI�YHKLFOHV�WR�EH�IXHOOHG��%HIRUH�ZH�JR�DQ\�IXUWKHU�WKRXJK��LW¶V�RQO\�IDLU�that we go over these various types and their common application FRQVLGHUDWLRQV�� �

7LPH�¿OO�VWDWLRQV�DUH�VLPSOH�VHW�ups that require small compressors and have no need for a storage V\VWHP��7KLV�VHW�XS�W\SLFDOO\�UHTXLUHV�VLJQL¿FDQWO\�OHVV�FDSLWDO�LQYHVWPHQW�and also requires less manpower costs as the drivers themselves can attach their vehicles to the PDQLIROG��7KH�V\VWHP�IXHOV�WKH�FDUV�GLUHFWO\� IURP�WKH�FRPSUHVVRU��7KLV�type of set-up is regularly used for ÀHHWV�WKDW�UHTXLUH�KDYLQJ�WR�UHWXUQ�WR� D� FHQWUDO� ORFDWLRQ� IRU� UHIXHOOLQJ��7KLV�PDNHV� LW� WKH�SUHIHUUHG� FKRLFH�IRU� YHKLFOH� ÀHHWV� FRQVLVWLQJ� RI�ZDVWH� WUXFNV� RU� VFKRRO� EXVHV�� 7KH�GRZQVLGH� WR� WKLV� WLPH�¿OO� V\VWHP�though is that it is only applicable WR� ÀHHWV� WKDW� UHWXUQ� WR� D� FRPPRQ�facility after being on rounds during

WKH�GD\��DV� WKH�¿OOLQJ� WLPH� LV�TXLWH�VLJQL¿FDQW� DQG� FRXOG� WDNH� D� IHZ�KRXUV�WR�UH¿OO�DQ�HQWLUH�ÀHHW�

1RW� DOO� ÀHHWV� DUH� DEOH� WR�accommodate such a large amount of downtime and this problem is VROYHG�E\�IDVW�¿OO�VWDWLRQV��$�PDMRU�GLHUHQFH� LV� LQ� WKH� DSSOLFDWLRQ� RI�high pressure chambers which DUH� VSOLW� LQWR� �� VHSDUDWH� VWRUDJH�EDQNV�� DUUDQJHG� VXFK� WKDW� WKHUH� LV�transference of pressure from low WR�PHGLXP�WR�KLJK��EHIRUH�EHLQJ�IHG�LQWR�WKH�WHPSHUDWXUH�FRPSHQVDWRU��'XULQJ� WKLV� IDVW� ¿OOLQJ� SURFHVV�� DV�WKH� SUHVVXUH� LQ� WKH� VWRUDJH� EDQNV�falls and the on-board pressure LQ� WKH� F\OLQGHU� ULVHV�� JDV� ÀRZ�GHFUHDVHV�� 2QFH� WKH� SUHVVXUH�UHDFKHV� D�SUHGHWHUPLQHG� OHYHO�� WKH�

system switches over to the medium pressure cylinder and then onto the high pressure cylinder in the same PDQQHU�� 7KLV� SUHVVXUH� EDODQFLQJ�act allows for the pressure storage V\VWHP� WR� EH� XVHG� DW� PD[LPXP�HFLHQF\� IDFLOLWDWLQJ� D� PRUH�FRPSOHWH�¿OO�

7KH�V\VWHP�DOVR�PDNHV�VXUH�WKDW�when the compressor is switched RQ�� LW� DXWRPDWLFDOO\� UH¿OOV� WKH�VWRUDJH� EDQNV� LQ� RUGHU�� ZLWK� WKH�KLJK� SUHVVXUH� WDQN� ¿UVW�� IROORZHG�E\�WKH�PHGLXP�DQG�ORZ��7KLV�DOORZV�IRU�WKH�SUHVVXUH�LQ�WKH�VWRUDJH�WDQNV�WR� EH� PDLQWDLQHG� DW� PD[LPXP�pressure – ensuring that vehicles are always supplied with the PD[LPXP�DPRXQW�RI�JDV��

7KH� EXHU� IDVW� ¿OO� VWRUDJH�V\VWHP��ZKLFK� LV� D� IDVW� ¿OO� V\VWHP�YDULDQW�� ZLOO� RSHUDWH� RQ� D� VSHFL¿F�pressure range whereby all the ¿OOLQJ� VWDWLRQ� SUHVVXUH� FKDPEHUV�are connected and maintained at WKH� VDPH� WLPH��7KLV�¿OOLQJ� V\VWHP�GRHV� QRW� PDNH� XVH� RI� �� VHSDUDWH�VWRUDJH� EDQNV� DQG� YHKLFOHV� DUH�¿OOHG�GLUHFWO\�IURP�WKH�FRPSUHVVRU�VLPLODU� WR� WLPH� ¿OO� VWDWLRQV�� 7KLV�type of system is typically meant for stations that are used for company VSHFL¿F� ÀHHWV� DQG� GHVLJQHG�according to the appropriate VSHFL¿FDWLRQV� IRU� WKDW� ÀHHW�� 7KH\�

Time Fill Station Schematic

CNG Station Inlet

Dryer By Pass Valve

CNG Compressor & Temperature Compensation

CNG Dryer

Fast Fill (Cascade) Schematic

CNG Station Inlet

V1 V2

Dryer By Pass Valve

CNG Compressor

Squencing & Temprerature Compensation

Priority Fill & Storage Bypass

CNG Dryer

H M L

V1 V2 V3

Page 16: NGV Transportation Magazine

14NGV Transportation Vol. 20 Oct - Dec 2014

FEATURE ARTICLE

are normally located on-site and are able to dispense relatively large quantities of fuel in a short span of WLPH��7KLV�PHWKRG�RI�IDVW�¿OOLQJ�LV�QRUPDOO\�XVHG�IRU�ÀHHWV�ZLWK�ODUJHU�YHKLFOHV� WKDW�QHHG� WR�EH� IDVW�¿OOHG�EDFN�WR�EDFN�IRU�VHYHUDO�KRXUV���

,� NQRZ� \RX¶UH� SUREDEO\�ZRQGHULQJ�ZKHUH�WKH�DQVZHUV�DUH��especially when we only seem to be EULQJLQJ� XS� PRUH� TXHVWLRQV�� %XW�\RX� NQRZ�ZKDW� WKH\� VD\� ±� JLYH� D�PDQ�D�¿VK�DQG�\RX�IHHG�KLP�IRU�D�GD\�EXW�WHDFK�D�PDQ�WR�¿VK�DQG�\RX�IHHG�KLP�IRU�D�OLIHWLPH��3HUKDSV�E\�JRLQJ�RYHU�WKHVH�LVVXHV�WKRURXJKO\��you will be able to understand the technicalities behind building a IXHO�VWDWLRQ�WKDW�ZLOO�IXHO�\RXU�ÀHHW�IRU�D�OLIHWLPH�

&DVFDGH�YV��%XHU:HOO�� ZKDW� WKHQ� LV� WKH� GLHUHQFH�EHWZHHQ� WKHVH� WZR� µIDVW¶� ¿OOLQJ�methods? A study conducted by the 6KDKURRG�8QLYHUVLW\�RI�7HFKQRORJ\�LQ� ,UDQ� FRPSDUHG� WKHVH� WZR�µIDVW¶� ¿OOLQJ� YDULDQWV�� 7DNLQJ� LQWR�FRQVLGHUDWLRQ� �� SDUDPHWHUV� ZKLFK�give rise to problems commonly DVVRFLDWHG�ZLWK� WKH� ¿OOLQJ� SURFHVV��¿OOLQJ� WLPH�� FKDUJHG� PDVV� DQG�FRPSUHVVRU�LQSXW�ZRUN�

7KHVH� �� SDUDPHWHUV� SURGXFHG�GLHUHQW�UHVXOWV�XSRQ�FRPSDULVRQ��,W� ZDV� IRXQG� WKDW� EXHU� V\VWHPV�¿OOHG� IDVWHU� WKDQ� WKH� FDVFDGH�

FRQ¿JXUDWLRQV�� %XHU� V\VWHPV�ZHUH� PRUH� WKDQ� ���� IDVWHU�� 7KH�VWXG\�GLG�QRWH�KRZHYHU�� WKDW� WKLV�issue can be easily remedied by XVLQJ� DSSURSULDWHO\� VL]HG� SLSLQJ�HTXLSPHQW�� $GMXVWLQJ� WKH� RUL¿FH�GLDPHWHU� FDQ� LQFUHDVH� WKH� ¿OO�VSHHG�VLJQL¿FDQWO\��

7KH� VHFRQG� SUREOHP� XVHG�for comparison was the charged PDVV� RU� WKH� µLQ�F\OLQGHU� PDVV¶�7KH� VWXG\� PHQWLRQV� WKDW� WKLV� µLQ�F\OLQGHU� PDVV¶� KDV� D� SURIRXQG�HHFW� RQ� WKH� 1*9� GULYLQJ� UDQJH��$Q� LQFUHDVH� LQ� µLQ�F\OLQGHU� PDVV¶�basically causes an increase in UHVHUYRLU� JDV� WHPSHUDWXUH�� ZKLFK�leads to a reduction of the reservoir SUHVVXUH�� 7KLV� GURS� LQ� SUHVVXUH�HHFWLYHO\�ORZHUV�WKH�GHQVLW\�RI�WKH�RQ�ERDUG�F\OLQGHU��ZKLFK�UHVXOWV�LQ�LQFRPSOHWH� ¿OOLQJ� RI� WKH� RQ�ERDUG�F\OLQGHU�� L�H�� D� UHGXFWLRQ� LQ� WKH�GULYLQJ�UDQJH�RI�WKH�1*9��

7KHUHIRUH�� WKH� KLJKHU� WKH�FKDUJHG� PDVV�� WKH� PRUH� SURSHUO\�¿OOHG� WKH� RQ�ERDUG� F\OLQGHU� ZLOO�EH�� ,Q� WKLV�ERXW�� WKH�EXHU� IDVW�¿OO�proved to be the victor once again – ZLWK�FDVFDGH�IDVW�¿OO�V\VWHPV�KDYLQJ�RQO\����� WKH� FKDUJHG�PDVV�RI� WKH�EXHU�IDVW�¿OO��

$W� D� VWDWLRQ�� JDV� IURP� WKH�distribution pipeline is compressed in an enormous compressor and WKHQ� NHSW� LQ� D� VWRUDJH� V\VWHP��HLWKHU� FDVFDGH� RU� EXHU��� 7KH�

FRPSUHVVRU� LV� KRZHYHU�� XQDEOH�WR� H[HFXWH� FRPSOHWH� ¿OOV� DW� KLJK�LQSXW�ZRUN�DQG�DV�VXFK��WKH�KLJKHU�WKH� LQSXW� ZRUN� UHTXLUHG� E\� WKH�compressor to compress and store WKH� JDV�� WKH� ODUJHU� WKH� ORVV� RI� JDV�WKURXJK� LQFRPSOHWH� ¿OOLQJ�� 7KLV�means that higher compressor ZRUN�UHVXOWV�LQ�D�ODUJHU�ORVV�RI�JDV��$V�DQ\RQH�ZLWK�D�EDVLF�NQRZOHGJH�of thermodynamics would tell you �,¶P�QRW�RQH�RI�WKHVH�SHRSOH���WKHUH�is a direct correlation between entropy generation and compressor ZRUN�� � 7KH� VWXG\¶V� UHVXOWV� VKRZHG�WKDW� D� FDVFDGH� IDVW� ¿OO� VWDWLRQ�SURGXFHG����� OHVV� HQWURS\� WKDQ�D�EXHU� V\VWHP�� LPSO\LQJ� WKDW� WKHUH�LV� VLJQL¿FDQWO\� OHVV� ORVV�RI�JDV� LQ�D�FDVFDGH�IDVW�¿OOLQJ�VWDWLRQ�

6R�� WR� VXP� XS� WKH� HSLF� EDWWOH�±� RI� WKH� �� URXQGV�� EXHU� V\VWHPV�RXWSHUIRUPHG� FDVFDGH� LQ� ��� ¿OOLQJ�WLPH� DQG� FKDUJHG� PDVV�� ZKLOH�cascade systems proved to be the winner only when comparing FRPSUHVVRU�LQSXW�ZRUN��

)LOO�+HU�8S,I� \RX¶UH� QRW� UHDG\� WR� JR� RXW� DQG�FDWFK� WKRVH� ¿VK� MXVW� \HW�� DW� OHDVW�ZH¶YH� KHOSHG� \RX� IDPLOLDULVH�\RXUVHOI�ZLWK�WKH�&1*�VWDWLRQ�$%&V��%\� XQGHUVWDQGLQJ� WKH� RSWLRQV�DYDLODEOH� WR� \RX�� LW� ZLOO� DOORZ� \RX�to identify areas where money can EH�PDGH�IURP�PD[LPL]LQJ�\RXU�JDV�XVH� DQG�PLQLPL]LQJ� \RXU� JDV� ORVV���$V� DOZD\V�� \RX� VKRXOG� HQVXUH� WKDW�you consult your CNG professional EHIRUH�WDNLQJ�RQ�VXFK�D�SURMHFW��2XU�role here is to provide you with a VRXQG�NQRZOHGJH�EDVH�WKDW�ZLOO�KHOS�\RX�PDNH�LQIRUPHG�GHFLVLRQV��,W� LV�our view that enabling infrastructure is one of the most important aspects responsible for the success of any QDWXUDO� JDV� YHQWXUH�� %\� NHHSLQJ�\RX�ZHOO�LQIRUPHG�DQG�LQ�WKH�NQRZ�– it is our hope that more will be VSXUUHG�WR�WDNH�RQ�WKLV�SLYRWDO�UROH�in contributing to the development of infrastructure that will lead to the future growth and sustainability of WKH�QDWXUDO�JDV�LQGXVWU\��

NTM By Ryan Pasupathy

Page 17: NGV Transportation Magazine

Tel: +65 6506 0951 | Fax +65 6749 7293 | Email: [email protected]

Jakarta, Indonesia | 18 - 19 March 2015

Pushing further ahead with Natural Gas Vehicles Utilization & Infrastructure Development in Indonesia

The time has come for Asia Pacific's NGV industry to converge again in Jakarta, Indonesia – taking advantage of the next big NGV markets in the world. With diesel and petrol prices scheduled to be further increased by late 2014, NGVs uptake is anticipated to increase significantly and natural gas is touted to be the most favoured alternative fuel of choice moving forward.

This business-critical forum will open up limitless business opportunities in Indonesia and the Asia Pacific region. This event is hosted by APCNGI (CNG Association of Indonesia) and supported & endorsed by ANGVA. Touted to be the most important NGV gatherings in 2015, the event promises to bring together all the relevant stakeholders to one room, one location.

REGISTER YOUR INTEREST TODAY!

HOSTED BY: SUPPORTED & ENDORSED BY: ORGANIZED BY: allevents group

IN PARTNERSHIPWITH

Page 18: NGV Transportation Magazine

16NGV Transportation Vol. 20 Oct - Dec 2014

FEATURE ARTICLE

WORLD’S LARGEST LNG IMPORTER

Japan:

2Q�2FWREHU� ���� ������%DVKDPLFKL� $YHQXH�LQ� <RNRKDPD� ZDV�OLW� XS� E\� JDVOLJKWV��PDUNLQJ� WKH� VWDUW�

RI� WKH� FLW\� JDV� EXVLQHVV� LQ� -DSDQ��)URP� WKDW� GD\� IRUZDUG�� JDV� KDV�played an increasingly important UROH�LQ�-DSDQ��DQG�LV�D�YLWDO�SDUW�RI�GDLO\�OLIH��LQ�WKH�FLW\�DQG�LQ�LQGXVWU\��

,QSH[� DQG� RWKHU� FRPSDQLHV�FUHDWHG� IURP� WKH� IRUPHU� -DSDQ�1DWLRQDO� 2LO� &RPSDQ\� DUH�WKH� SULPDU\� DFWRUV� LQ� -DSDQ¶V�GRPHVWLF� QDWXUDO� JDV� VHFWRU�� DV�WKH\� DUH� LQ� WKH� RLO� VHFWRU�� ,QSH[��0LWVXELVKL�� 0LWVXL�� DQG� YDULRXV�RWKHU� -DSDQHVH� FRPSDQLHV� DUH�actively involved in domestic as well as foreign natural gas

H[SORUDWLRQ� DQG� SURGXFWLRQ��2VDND�*DV��7RN\R�*DV��DQG�7RKR�*DV� DUH� -DSDQ¶V� ODUJHVW� QDWXUDO�JDV� UHWDLO� FRPSDQLHV�� ZLWK� D�FRPELQHG� VKDUH� RI� DERXW� ���� RI�WKH�UHWDLO�PDUNHW��

6DOHV� YROXPHV� RI� FLW\� JDV� LQ�)<������ZHUH�DSSUR[LPDWHO\������billion m��� DQ� LQFUHDVH� RI� DERXW������ RYHU� WKH� ODVW� WHQ� \HDUV��,QGXVWULDO�GHPDQG�KDV�EHHQ�ULVLQJ�DW�D�SDUWLFXODUO\�UDSLG�SDFH��

7KHUH� DUH� DSSUR[LPDWHO\� ����FLW\�JDV�XWLOLWLHV�WKURXJKRXW�-DSDQ�VHUYLQJ������PLOOLRQ�FXVWRPHUV�

City gas is made out of natural JDV� �/1*�� DQG� SHWUROHXP� JDV��/3*��� 7KH� FXUUHQW� FRPSRVLWLRQ�RI� FLW\� JDV� LQ� -DSDQ� LV� ����/1*�

Page 19: NGV Transportation Magazine

17 Vol. 20 Oct - Dec 2014 NGV Transportation

FEATURE ARTICLE

Figure 1: Proportion of City Gas Sales in Japan

Figure 2: LNG Imports to Japan

DQG�����/3*��

,PSRUWLQJ�*DV$V� -DSDQ� KDV� OLPLWHG� GRPHVWLF�HQHUJ\� UHVRXUFHV�� PXFK� RI�the gas required by its energy FRQVXPSWLRQ� LV� LPSRUWHG�� ,W� LV�WKH� ZRUOG¶V� ODUJHVW� LPSRUWHU� RI�OLTXH¿HG�QDWXUDO�JDV�DQG�WKH�WKLUG�largest oil consumer and importer EHKLQG� WKH� 8QLWHG� 6WDWHV� DQG�&KLQD�� -DSDQ� VWDUWHG� LPSRUWLQJ�/1*� LQ� ����� DQG� FXUUHQWO\�� RYHU�����RI�WKH�JDV�UHTXLUHG�LQ�-DSDQ�in imported through 22 terminals ORFDWHG�WKURXJKRXW�WKH�LVODQG��

-DSDQ¶V�RSHUDWLQJ�/1*�LPSRUW�terminals have a total gas send-RXW� FDSDFLW\� RI� ���� 7FI�\�� ZHOO� LQ�H[FHVV�RI�GHPDQG��+RZHYHU��WKHVH�terminals are not running on full capacity as it is constrained by the amount of LNG it can receive based RQ� EHUWKLQJ�� VKLS� VL]H� DQG� RWKHU�OLPLWDWLRQV�RQ�LQIUDVWUXFWXUH��

7KH� ODUJHVW� UHJDVL¿FDWLRQ�storage capacity in the world LV� LQ� -DSDQ�� KROGLQJ� RYHU� ����00FI�� 7KLV� DFWV� DV� D� EXHU� IRU�VHDVRQDO� /1*� GHPDQG�� /1*�terminals are usually located QHDU� WKH� PDLQ� FLWLHV� RI� 7RN\R��2VDND�� DQG� 1DJR\D� ZKHUH� WKHUH�LV� KLJK�GHPDQG��3ULYDWHO\� RZQHG�terminals are also in operation near major manufacturing hubs DQG� ORFDO� SRZHU� FRPSDQLHV�� )LYH�terminals are currently under

construction and will add about ����%FI�\HDU�RI�FDSDFLW\�WR�-DSDQ�E\�������

$ERXW� D� WKLUG� RI� -DSDQ¶V�LNG imports originate from UHJLRQDO� VXSSOLHUV� LQ� 6RXWKHDVW�$VLD�� DOWKRXJK� WKH� FRXQWU\� KDV�a fairly balanced portfolio with QR� RQH� VXSSOLHU� KDYLQJ� D�PDUNHW�VKDUH� JUHDWHU� WKDQ� URXJKO\� �����-DSDQ¶V� WRS� ¿YH� JDV� VXSSOLHUV�SURYLGHG� ���� RI� LWV� QDWXUDO� JDV�LPSRUWV� LQ������� �)LJXUH��� After WKH� 0DUFK� ����� GLVDVWHU�� VHYHUDO�VXSSOLHUV� IURP� 4DWDU�� 5XVVLD��0DOD\VLD��DQG�,QGRQHVLD�H[SRUWHG�FDUJRHV� WR� -DSDQ� WKURXJK� VZDSV�DQG� GLYHUWHG� FDUJRHV�� 4DWDU�� WKH�ZRUOG¶V� ODUJHVW� VXSSOLHU� RI� /1*��

RYHUWRRN�,QGRQHVLD�DQG�0DOD\VLD�in the past two years to become the second largest supplier to -DSDQ�LQ������DQG�SURYLGHG�PRVW�of the additional imports needed DIWHU�WKH�HDUWKTXDNH�XQGHU�VKRUW�WHUP�DJUHHPHQWV��-DSDQHVH�XWLOLW\�companies signed agreements ZLWK�4DWDUJDV�DW�WKH�HQG�RI������WR�VHFXUH�ORQJHU�WHUP�/1*�VXSSO\��

6XSSOLHV� IURP� WUDGLWLRQDO�suppliers such as Malaysia DQG� ,QGRQHVLD� DUH� EHFRPLQJ�PRUH� FRQVWUDLQHG� DQG� -DSDQ�LV� VHHNLQJ� WR� GLYHUVLI\� LWV�contracts and investments in RWKHU� /1*� YHQWXUHV�� $XVWUDOLD�surpassed Malaysia to become -DSDQ¶V� ODUJHVW� /1*� VXSSOLHU� LQ������� -DSDQHVH� FRPSDQLHV� DUH�LQYHVWLQJ�LQ�VPDOO�HTXLW\�VWDNHV�LQ�$XVWUDOLD¶V� OLTXHIDFWLRQ� SURMHFWV��-DSDQHVH� HOHFWULF� FRPSDQLHV��gas companies and trading houses have signed contracts with various large LNG projects LQ� $XVWUDOLD�� PRVW� VLJQL¿FDQWO\�WKH� &KHYURQ�OHG� *RUJRQ� SURMHFW��which should provide up to 2 %FI�G� RI� /1*� WR� $VLDQ� PDUNHWV�E\�HQG������� ,Q������0LWVXL�DQG�0LWVXELVKL�SXUFKDVHG�D�����VWDNH�LQ�$XVWUDOLD¶V�%URZVH�/1*�SURMHFW�WKDW�ZLOO�VXSSO\�DW�OHDVW�����%FI�G�RI� QDWXUDO� JDV� IURP� WKH� %URZVH�%DVLQ� LQ� :HVWHUQ� $XVWUDOLD��-DSDQ�EHJDQ�LPSRUWLQJ�/1*�IURP�5XVVLD¶V� 6DNKDOLQ� WHUPLQDO� LQ�

Page 20: NGV Transportation Magazine

18NGV Transportation Vol. 20 Oct - Dec 2014

FEATURE ARTICLE

������ DQG� WKH� WZR� FRXQWULHV� DUH�discussing ways to increase gas LPSRUWV� WR� -DSDQ� YLD� D� SURSRVHG�SLSHOLQH�RU�PRUH�/1*�VKLSPHQWV�

Additional LNG supplies to -DSDQ�FRXOG�VWHP�IURP�RWKHU�QHZ�projects in Papua New Guinea or 1RUWK� $PHULFD� LQ� WKH� ORQJ� WHUP��-DSDQ� LV� LQ�GLVFXVVLRQV�ZLWK�8�6��H[SRUWHUV� IRU� DGGLWLRQDO� QDWXUDO�JDV�VXSSO\��DOWKRXJK�QHJRWLDWLRQV�GHSHQG� RQ� DSSURYDO� RI� H[SRUW�OLFHQVHV� E\� WKH� 8QLWHG� 6WDWHV�� ,Q�0D\� ������ WKH� 8�6�� 'HSDUWPHQW�of Energy gave approval for its Freeport LNG terminal in the *XOI� RI� 0H[LFR� WR� VKLS� /1*� WR�countries that do not hold free WUDGH�DJUHHPHQWV��)7$V��ZLWK�WKH�8QLWHG�6WDWHV��7KLV�GHFLVLRQ�DOORZV�-DSDQHVH� XWLOLWLHV� WR� IRUPDOL]H�deals for LNG supply from the WHUPLQDO¶V� RSHUDWRU�� -DSDQ¶V�&KXEX� (OHFWULF� DQG� 2VDND� *DV�signed preliminary agreements WR� LPSRUW� RYHU� ���� %FI�\� HDFK�IRU� ��� \HDUV� IURP� )UHHSRUW� /1*�VWDUWLQJ� LQ� ������ PDUNLQJ� D�potential reduction in the high /1*� SULFHV� WKDW� -DSDQ� FXUUHQWO\�SD\V�� 6XPLWRPR�� -DSDQ¶V� WKLUG�ODUJHVW� WUDGLQJ� KRXVH�� KROGV� DQ�DJUHHPHQW� WR� EX\� ���� %FI�\� IRU���� \HDUV� IURP� &RYH� 3RLQW� /1*�RQ� WKH� 8�6�� (DVW� &RDVW� ZKLFK�UHFHLYHG� DSSURYDO� WR� H[SRUW� WR�QRQ�)7$� FRXQWULHV� LQ� 6HSWHPEHU������� 6XPLWRPR� LQWHQGV� WR� VHOO�WKH� VXSSO\� WR� XWLOLWLHV� 7RN\R�*DV�DQG�.DQVDL�(OHFWULF��,Q�0D\�������0LWVXELVKL� DQG� 0LWVXL�� -DSDQ¶V�WZR� ODUJHVW� WUDGLQJ� FRPSDQLHV��¿UVW� YHQWXUHG� LQWR� WKH�8�6�� VKDOH�JDV� H[SRUW�PDUNHW� E\�SXUFKDVLQJ�D� FRPELQHG� ���� HTXLW\� VKDUH�Cameron LNG project located LQ� WKH� *XOI� RI� 0H[LFR�� 7KH�companies have agreements to SXUFKDVH�����%FI�\��RU�WZR�WKLUGV�RI� WKH� WHUPLQDO¶V� H[SRUW� FDSDFLW\��H[SHFWHG�WR�FRPH�RQOLQH�E\������

-DSDQHVH� UHJXODWLRQV� SHUPLW�individual utilities and natural gas distribution companies to sign LNG supply contracts with foreign VRXUFHV�� LQ� DGGLWLRQ� WR� GLUHFWO\�LPSRUWLQJ� VSRW� FDUJRHV�� 7KH�

largest LNG supply agreements DUH� KHOG� E\� 7RN\R� *DV�� 2VDND�*DV�� &KXEX� (OHFWULF�� 7(3&2��.DQVDL� (OHFWULF�� .\XVKX� (OHFWULF��DQG� 7RKRNX� (OHFWULF�� SULPDULO\�ZLWK� FRXQWULHV� LQ� 6RXWKHDVW� $VLD�DQG� WKH� 0LGGOH� (DVW�� 0DQ\� RI�-DSDQ¶V� H[LVWLQJ� /1*� FRQWUDFWV�WKDW� GDWH� IURP� WKH� ����V� DQG�����V�DUH�H[SLULQJ��IRUFLQJ�-DSDQ�to renegotiate term contracts or ORFDWH� VKRUWHU�WHUP�VXSSO\��6RPH�industry analysts suggest that this LV�GULYLQJ�-DSDQHVH�¿UPV¶�LQWHUHVW�LQ� DFTXLULQJ� HTXLW\� VWDNHV� LQ�IRUHLJQ�OLTXHIDFWLRQ�SURMHFWV��LQ�DQ�HRUW�WR�JXDUDQWHH�IXWXUH�VXSSO\�

$IWHU�)XNXVKLPD:KHQ� WKH� ���� PDJQLWXGH�HDUWKTXDNH�� WULJJHULQJ� D� ODUJH�WVXQDPL�� VWUXFN� RII� WKH� FRDVW�RI� 6HQGDL�� -DSDQ� RQ� 0DUFK������� RYHU� ��� *:� RI� QXFOHDU�electric generating capacity was shut down instantly amidst fears generated from the )XNXVKLPD� QXFOHDU� GLVDVWHU��%HWZHHQ� WKH� ����� )XNXVKLPD�GLVDVWHU� DQG�0D\� ������ -DSDQ¶V�energy consumption changed dramatically as all nuclear capacity was lost as a result of scheduled maintenance and ODFN�RI�JRYHUQPHQW�DSSURYDOV� WR�

UHWXUQ�WR�RSHUDWLRQ��7ZR�QXFOHDU�reactors were re-commissioned LQ� -XO\� ����� DQG� UHSUHVHQWHG�the only source of nuclear power in the country for more than RQH� \HDU�� +RZHYHU�� WKHVH� WZR�reactors were removed from VHUYLFH�DJDLQ�LQ�6HSWHPEHU�������HOLPLQDWLQJ�WKH�FRXQWU\¶V�QXFOHDU�capacity for a second time in PRUH�WKDQ����\HDUV�

1XFOHDU� JHQHUDWLRQ� LQ� -DSDQ�UHSUHVHQWHG� DERXW� ���� RI� WKH�SRZHU�JHQHUDWLRQ�SULRU�WR�WKH������HDUWKTXDNH� DQG� ZDV� RQH� RI� WKH�FRXQWU\¶V� OHDVW� H[SHQVLYH� IRUPV�RI� SRZHU� VXSSO\�� -DSDQ� UHSODFHG�WKH� VLJQL¿FDQW� ORVV� RI� QXFOHDU�power with generation from LPSRUWHG� QDWXUDO� JDV�� ORZ�VXOIXU�FUXGH� RLO�� IXHO� RLO�� DQG� FRDO� WKDW�caused a higher price of electricity IRU� LWV� JRYHUQPHQW�� XWLOLWLHV��DQG� FRQVXPHUV�� )XHO� LPSRUW�cost increases have resulted in -DSDQ¶V� WRS� ��� XWLOLWLHV� ORVLQJ�RYHU� ���� ELOOLRQ� LQ� WKH� SDVW� WZR�\HDUV�� -DSDQ� VSHQW� ����� ELOOLRQ�RQ� WRWDO� IXHO� LPSRUWV� LQ� ������ D�WKLUG�RI�WKH�FRXQWU\¶V�WRWDO�LPSRUW�FKDUJH��'HVSLWH�VWUHQJWK�LQ�H[SRUW�PDUNHWV�� WKH� \HQ¶V� GHSUHFLDWLRQ�and soaring natural gas and oil import costs from a greater reliance on fossil fuels continued

Page 21: NGV Transportation Magazine

19 Vol. 20 Oct - Dec 2014 NGV Transportation

FEATURE ARTICLE

WR� GHHSHQ� -DSDQ¶V� UHFHQW� WUDGH�GH¿FLW�WKURXJKRXW������

,Q�WKH�ZDNH�RI�WKH�)XNXVKLPD�QXFOHDU�LQFLGHQW��-DSDQ¶V�HQHUJ\�IXHO� PL[� KDV� VKLIWHG� DV� QDWXUDO�JDV�� RLO�� DQG� UHQHZDEOH� HQHUJ\�provide larger shares and supplant some of the nuclear IXHO�� 2LO� UHPDLQV� WKH� ODUJHVW�source of primary energy in -DSDQ�� DOWKRXJK� LWV� VKDUH� RI�total energy consumption has GHFOLQHG� IURP� DERXW� ���� LQ�WKH� ����V� WR� ���� LQ� ������ 7KH�decline in oil use occurred as a result of increased energy HIILFLHQF\�DQG�WKH�H[SDQGHG�XVH�RI�QXFOHDU�SRZHU�DQG�QDWXUDO�JDV��Coal continues to account for a significant share of total energy FRQVXPSWLRQ�� DOWKRXJK� QDWXUDO�gas is increasingly important as a fuel source and is currently the preferred fuel of choice to UHSODFH� WKH� QXFOHDU� VKRUWIDOO��1DWXUDO� JDV� URVH� IURP� ���� LQ������ WR� ���� RI� WRWDO� SULPDU\�FRQVXPSWLRQ�LQ������

6HYHUDO�IDFWRUV�IDYRXU�WKH�XVH�of LNG over other fossil fuels and other sources to replace nuclear HQHUJ\�DIWHU�WKH������HDUWKTXDNH��Current government pledges to reduce carbon emissions support natural gas as the cleanest IRVVLO� IXHO� WR� UHSODFH� FDSDFLW\��$OVR�� QDWXUDO� JDV� UHPDLQV�

cheaper than oil in contrast to the situation following the ODVW� PDMRU� HDUWKTXDNH� LQ� ������when fuel oil made the biggest JDLQV�IURP�LQFUHPHQWDO�GHPDQG��Destruction of coal-fired electric capacity was widespread in the DUHD�DIIHFWHG�E\�WKH�HDUWKTXDNH��restricting its use for two years IROORZLQJ�)XNXVKLPD�

*DV�3URGXFWLRQ$V� RI� -DQXDU\� ������ -DSDQ� KDG����� ELOOLRQ� FXELF� IHHW� �%FI�� RI�SURYHQ� QDWXUDO� JDV� UHVHUYHV��6LQFH� ������ -DSDQ¶V� SURYHQ�reserves have fallen by nearly KDOI� IURP� ���� WULOOLRQ� FXELF� IHHW��7FI��� 0RVW� RI� -DSDQ¶V� QDWXUDO�gas fields are located along the ZHVWHUQ�FRDVWOLQH��

,Q� ������ SURGXFWLRQ� ZDV� ����%FI��D�GHFOLQH� IURP�DQ�DYHUDJH�RI����� %FI� RYHU� WKH� SDVW� ��� \HDUV��-DSDQ¶V�ODUJHVW�QDWXUDO�JDV�¿HOG�LV�WKH�0LQDPL�1DJDRND�¿HOG�RQ�WKH�ZHVWHUQ� FRDVW� RI� +RQVKX�� ZKLFK�SURGXFHV� DERXW� ���� RI� -DSDQ¶V�GRPHVWLF� JDV�� ([SORUDWLRQ� DQG�development are still ongoing at WKDW�¿HOG��ZKLFK�,QSH[�GLVFRYHUHG�LQ� ������ 7KH� JDV� SURGXFHG� LV�WUDQVSRUWHG� YLD� D� �����NP�SLSHOLQH� QHWZRUN� WKDW� VWUHWFKHV�across the region surrounding the 7RN\R� PHWURSROLWDQ� DUHD�� ,QSH[�is building an LNG terminal with

D� ��� %FI�\� FDSDFLW\� DW� 1DRHWVX�SRUW� LQ� -RHWVX� &LW\�� ZKLFK� ZLOO�connect its domestic pipeline infrastructure with its overseas DVVHWV�LQ�$XVWUDOLD�E\�������-DSH[�has been involved in locating new GRPHVWLF� UHVHUYHV� LQ� WKH�1LLJDWD��$NLWD�� DQG� +RNNDLGR� UHJLRQV�RI� -DSDQ�� WDUJHWLQJ� DUHDV� QHDU�H[LVWLQJ�RLO�DQG�JDV�¿HOGV�

-DSDQHVH� FRPSDQLHV� DUH�using innovative methods to produce hydrocarbons and have GLVFRYHUHG� PHWKDQH� K\GUDWHV� R �WKH�FRXQWU\¶V�HDVW�FRDVW��,Q�0DUFK������� -2*0(&� FRQGXFWHG� WKH�¿UVW�VXFFHVVIXO�WHVWLQJ�RI�PHWKDQH�K\GUDWHV� RVKRUH� DQG� FRQ¿UPHG�-DSDQ¶V� HVWLPDWHV� RI� ��� 7FI� RI�PHWKDQH� K\GUDWHV� LQ� WKH� 1DQNDL�7URXJK�RQ� WKH�VRXWKHDVW� FRDVW�RI�WKH�FRXQWU\��-DSDQ�KRSHV�WR�EHJLQ�SURGXFWLRQ�E\�������DOWKRXJK�WKH�high cost of such developments FRXOG�SXVK�EDFN�SURGXFWLRQ�SODQV�

$V� RI� ������ -DSDQ� KDV�RYHU� �������� NP� RI� SLSHOLQH�LQVWDOOHG��������RI�ZKLFK�DUH�ORZ�SUHVVXUH�SLSHOLQHV��OHVV�WKDQ�����03D��� ������ PHGLXP� SUHVVXUH������ 03D� WR� �� 03D�� DQG� �����KLJK� SUHVVXUH� SLSHOLQHV� ��� 03D�DQG� KLJKHU��� �)LJXUH� �� Even WKRXJK� -DSDQ� LV� D� ODUJH� QDWXUDO�JDV�FRQVXPHU��LW�KDV�D�UHODWLYHO\�limited domestic natural gas pipeline transmission system for D�FRQVXPHU�RI�LWV�VL]H��7KLV�OLPLWHG�pipeline system is partly due to geographical constraints posed E\� WKH� FRXQWU\¶V� PRXQWDLQRXV�WHUUDLQ��EXW�LW�LV�DOVR�WKH�UHVXOW�RI�previous regulations that limited LQYHVWPHQW�LQ�WKH�VHFWRU��

2YHUVHDV�([SDQVLRQ,Q�OLJKW�RI�-DSDQ¶V�ODFN�RI�VXFLHQW�GRPHVWLF� K\GURFDUERQ� UHVRXUFHV��-DSDQHVH� HQHUJ\� FRPSDQLHV� KDYH�actively pursued participation in upstream oil and natural gas projects RYHUVHDV� DQG� SURYLGH� HQJLQHHULQJ��FRQVWUXFWLRQ��¿QDQFLDO��DQG�SURMHFW�management services for energy SURMHFWV�DURXQG� WKH�ZRUOG��-DSDQ�LV� RQH� RI� WKH� PDMRU� H[SRUWHUV� RI�HQHUJ\�VHFWRU� FDSLWDO� HTXLSPHQW��

Figure 3: Gas Pipeline Breakdown in Japan

Page 22: NGV Transportation Magazine

20NGV Transportation Vol. 20 Oct - Dec 2014

FEATURE ARTICLE

and has a strong energy research DQG�GHYHORSPHQW��5'��SURJUDP�VXSSRUWHG�E\�WKH�JRYHUQPHQW�

&RQFOXVLRQ7KH� ZRUOG¶V� ODUJHVW� LPSRUWHU� RI�OLTXH¿HG�QDWXUDO�JDV�KDV�LWV�IXWXUH�WLHG�WR�/1*��:LWK�SODQV�WR�IXUWKHU�diversify their fuel sources the FRXQWU\�ORRNV�OLNH�LW�ZLOO�FRQWLQXH�

Country Project Japanese Equity

Australia Ichthys LNG Project, Browse Basin, Western Australia

Inpex: 66%, Japanese Electric Utilities: 2.74%

Australia Pluto LNG Project Tokyo Gas 5%, Kansai Electric 5%

Australia Timor Sea Joint Petroleum Development Area Inpex, Tokyo Gas, and TEPCO combined 20%

Australia Prelude LNG Inpex 17.5%

Australia Darwin LNG Inpex 11.3%, TEPCO 6%, and Tokyo Gas 3%

Australia Wheatstone LNG Japanese Electric & Gas Utilities: 9.455%

Australia Browse LNG Mitsubishi and Mitsui (MMI Browse) 14.7% in LNG Terminal. MIMI Browse owns stake in gas and EQPFGPUCVG�ƂGNFU������KP�'CUV�$TQYUG�CPF����KP�9GUV�Browse

Canada Canada LNG Mitsubishi 20%

Canada 2CEKƂE�0QTVJYGUV�.0) Japex 10%

Canada Nexen Shale Gas Projects Inpex 40% in upstream development of Cordova, Horn River, and Liard Basins

Canada Cutbank Ridge shale gas project in the Montney Ridge formation

Mitsubishi 40%

Canada Cordova Embayment shale gas project

Mitsubishi 50%

Indonesia Berau Block, Tangguh LNG Project

Joint venture of Inpex and Mitsubishi has a 22.9% interest in the Berau Block and a 16.3% interest in the Tangguh Project.

Indonesia Senoro LNG Plant, Sulawesi Mitsubishi 45%

Indonesia Mahakam Block and Attaka Unit, Offshore Kalimantan Island

Inpex 50%

Indonesia Abadi LNG Project Inpex 60% of LNG terminal and 100% of Masela block.

WR�LQYHVW�LQ�VWDNHV�RI�IRUHLJQ�/1*�SURMHFWV��'LYHUVLI\LQJ�WKHLU�HQHUJ\�sources is of utmost importance IRU� -DSDQ�� HVSHFLDOO\� VLQFH� WKH�)XNXVKLPD� GLVDVWHU�� )XUWKHU� JDV�H[SORUDWLRQ� DORQJ� WKH� FRXQWU\¶V�coast should lead to discoveries RI� QHZ� JDV� ¿HOGV�� RI� ZKLFK� ZLOO�EH� DEOH� WR� WDNH� IXOO� DGYDQWDJH� RI�their recently completed pipeline

JAPAN’S MAJOR UPSTREAM OVERSEAS NATURAL GAS PROJECTS

LQIUDVWUXFWXUH�� 7KHVH� DUH� VRPH�very clear indicators that as -DSDQ�SUHVVHV�RQZDUG�ZLWK�D�JDV�centered approach to its energy QHHGV��WKH�FRXQWU\�ZLOO�YHU\�OLNHO\�remain an important player in the industry for many more decades WR�FRPH�

NTM By Vincent Choy

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21 Vol. 20 Oct - Dec 2014 NGV Transportation

FEATURE ARTICLE

Indonesia Tangguh LNG Project (Berau Block)

LNG terminal and 22.9% of Berau block.

JX Nippon and JOGMEC 12.2% of LNG terminal and 17.1% of Berau block.

Malaysia 6 gas exploration and development projects

,:�0KRRQP��$NQEM�5-���������$NQEM�5-����������$NQEM�5-����������$NQEM�2/���#������CPF�Deepwater Block R (37.5%), and Deepwater Block 2F (40%). JX Nippon: 10% interest in Tiga LNG terminal.

Russia Sakhalin-II Mitsui and Mitsubishi combined 22.5%

United States

)WNH�QH�/GZKEQ�CPF�ICU�ƂGNFU Inpex 15% of Walker Ridge deep water exploration; other interests in shallow water blocks.

United States

Marcellus shale gas assets in Pennsylvania

Mitsui acquired 32.5% of Anadarko Energy assets.Sumitomo acquired 30% of Rex Energy Corporation assets.

United States

Barnett shale gas project in Texas Sumitomo 12.5%

Source: www.eia.gov

infrastructure to prompt vehicle conversion.

However, NGVs truly took off in 1999 when serious environmental concerns prompted the then Governor of Tokyo Metropolitan Government to conduct a “Say ‘No’ tto Dirty Diesel Vehicle Campaign” from 1999 - 2000. Brandishing a bottle of dirty black particulate matter as emitted by vehicles to emphasize his point, the governor launched a conversion programme to encourage vehicle users

NGVs were first introduced into Japan in 1990 as a means of diversifying the use of natural gas at that time. However, the market for NGVs languished mainly because of the high cost of NGVs and the relatively small number of refuelling stations.There was no concentrated push for the conversion to NGVs and the market fell into the familiar chicken and egg situation where there were not enough vehicles to prompt infrastructure development and there was not enough

to switch to the more environmentally friendly natural gas vehicles through a series of policy measures and media awareness. PM emission standards in Japan were tightened from 0.7g/kWh before 1999 to 0.25g/kWh in 1999 to the 0.01g/kWh in 2011. Similarly, NOx emissions standards were reduced from 6.0g/kWh before 1999 to 4.5g/kWh in 1999 to its current 0.7g/kWh in 2011. All in all, standards for NOx were tightened by more than 9 times and PM over 70 times over the last 15 years. (Figure 1)

As a result of the new regulations as well as subsidies given by the national and local governments and trucking association, NGVs grew rapidly in Japan from 1999 to 2007. From 1998, when there were only 2,093 NGVs, it

“NGV GROWTH IN JAPAN IRONICALLY UNDERMINED BY STRICT ENVIRONMENTAL REGULATIONS” - Yusuke Hirase, Japan Gas Association

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22NGV Transportation Vol. 20 Oct - Dec 2014

FEATURE ARTICLE

grew at an average rate of 35.14% to 31,462 vehicles by 2007. The number of stations also grew from 62 in 1998 to 324 by 2007.

ChallengesCurrently, although official figures show that there are 43,000 registered NGVs in Japan, the figure is an accumulation of vehicles from 1990. The Japan Gas Association estimates that there are approximately only 30,000 NGVs plying the roads in Japan at the moment. (Figure 2)

One of the reasons for the decline in the popularity of NGVs in Japan is the improvement in petroleum and diesel emission standards. With the cleaning up of emissions from diesel engines, most vehicles in Japan meet the strict pollution standards set by the government and many Japanese do not see the need to convert their vehicles. In a way, the success of Japan’s pollution regulations in forcing vehicle manufacturers to clean up their engines and emission controls is the ironic main cause for the decline in popularity of NGVs in Japan.

The Future Of Ngvs In JapanWith air pollution no longer

the principal driver for the growth on NGVs in Japan, the Japan Gas Association has switched its focus towards promoting NGVs on the grounds of energy security and global warming. Natural gas, as a cleaner burning fuel, emits 20% less GHG emissions than diesel and petroleum and NGVs can play a part in helping Japan meet its GHG emission reduction pledges.

The Japan Gas Association also draws lessons learned from the Great East Japan Earthquake. Energy

diversification in the transport sector is crucial to ensure that supply lines can continue to operate in the case of a natural disaster disrupting vital supplies of any particular energy source. NGVs were used to deliver relief supplies to earthquake stricken districts when there were long queues for petrol and diesel. The government of Japan has drafted NGVs in the Basic Act for National Resilience for disaster reduction and mitigation ensuring the continued development of the NGV industry in Japan for energy security reasons.

A new programme being adopted by the Japan Gas Association is the introduction of large NGV trucks for long haul, inter-city transportation. The programme, currently at a testing stage, consists of 3 heavy-duty, CNG trucks (GWV 25t) with which the association has requested operators to use as trial. Each operator will use the truck for 6 months to examine its impact on their trucking operations

7,811

12,012

16,561

20,638

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34,203

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Number of NGVs

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CNGFillingStation

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Figure 2: Number of NGVs & Filling Stations in Japan

1/9

1/70

Figure 1: Emission Standards in Japan

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23 Vol. 20 Oct - Dec 2014 NGV Transportation

FEATURE ARTICLE

GREEN FLEETS FOR CORPORATE SOCIAL RESPONSIBILITY:

SAGAWA EXPRESS

For Sagawa Express, being a good corporate citizen is part of good business and that’s why they saw no hesitation in converting its fleet of trucks to run on natural gas.

Established in 1957, Sagawa Express is a door-to-door delivery service and total logistics solutions provider headquarters in Kyoto, Japan. Realizing the need to reduce its carbon footprint to gain environmental sustainability, Sagawa Express started looking into the use of alternative fuels for its vehicle fleet since 1992.

Starting with a trial of 10 trucks running on CNG, Sagawa Express jumped on to the CNG bandwagon full time in 1997 with the ratification of the Kyoto Protocol, promising to reduce its carbon footprint by reducing its GHG emissions by 9.29% by 2012. Currently, it runs 3,981 trucks powered by CNG, giving it the largest logistics fleet in the Asia Pacific powered by natural gas.

Running a CNG fleet has its own challenges. Sagawa Express experienced this first hand when it implemented its

CNG fleet. One of the biggest challenges that Sagawa Express had to overcome was the lack of infrastructure. In order to cater to the fleet, Sagawa Express had to build and operate its own CNG stations, as there weren’t enough publicly available refuelling stations. Currently, Sagawa Express operates 22 CNG stations across their network catering to their own CNG fleer.Sagawa Express had to make significant investment during their conversion process. On top of the costs of building CNG stations, OEM NGVs was also 25% more expensive than their diesel-fuelled cousins. Thankfully, much of the difference in costs was absorbed by national and municipal government subsidies, which made the decision to invest in CNG much easier.

In Japan, fuel cost differences between natural gas and diesel is a mere 15% and any operational cost savings that Sagawa Express could have enjoyed is more than offset by the cost of operating its own CNG stations. Still, even, with higher costs, Sagawa Express is committed to cutting emissions from their operations as a socially responsible company and we hope that more companies around the world will have the vision to commit to a more livable, greener environment for all.

with regards to C02 reduction,

economical benefit, drivability and other operating factors. So far, the participants in the trial include, Nippon Express, Sagawa Express, Yamato Transport, Tonami Transportation, and Suntory Logistics, amongst others.

The Japan Gas Association has also operated one one LNGV and one LNG station NTM

NTM

By Vincent Choy

By Vincent Choy

as a trial but currently still do not have any operating LNGVs in Japan. However, with ready LNG infrastructure in place, introducing LNGVs in Japan for HD trucks and long distance transport could happen in the near future.

The Japan Gas Association hopes that the use of these HD vehicles will provide another avenue of growth for

the NGV market in Japan. All in all, the Japan Gas Association is committed to the continued development of sustainable transportation systems centered on NGVs in Japan. They will also continue to support and encourage its growth through new programmes and trials.

Page 26: NGV Transportation Magazine

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SOLUTIONS

In the short term, the release of polluting exhaust gases (SO

x, NO

x, CO

2) will be

restricted.

A set of new international regulations are coming progressively into force, which will impose the use of cleaner fuels.

LNG, being by far the cleanest and probably the cheapest of all fuels comes to mind as the most obvious alternative.

GTT, through its experience in the design of LNG handling and storage systems, both at sea, and on land, is ideally positioned as the preferred partner for the implementation of clean, efficient and reliable solutions at each step of the supply chain.

GTT has solutions for land storage tanks, and bunker tanks for all types of vessel.

www.gtt.fr

Gaztransport & Technigaz1 route de Versailles, 78470 Saint-Rémy-lès-Chevreuse - France

Tel: +33 (0)1 30 234 789 - E-mail: [email protected]

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25 Vol. 20 Oct - Dec 2014 NGV Transportation

SPECIAL REPORT

Alaska LNG No Lessons Learned

From Australia

6KDOO�ZH�EH�H[FLWHG"�)RU�D� VHFRQG� ZH� PLJKW��but there is something strange creeping up RXU�VSLQHV�

$ERXW���\HDUV�DJR�,�ZURWH�DERXW�WKH� %ODFN� 0DPED� HHFW� LQ� /1*�SURMHFWV��5HPHPEHU���WKH�UDWLRQDOH�LV� VLPSOH�� 6SHQG� WRR�PXFK�PRQH\�while building your project and you are toast in the long run as no PDUNHW�VWD\V�VWUDWRVSKHULF�IRUHYHU�

:H� KDYH� VHHQ� LW� GHYHORSLQJ� LWV�IXOO� HHFW� LQ� $XVWUDOLD� ZKHUH� /1*�projects are already technically EDQNUXSW� EHIRUH� WKH\� DUH� HYHQ�FRPPLVVLRQLQJ�� � 1RW� VPDUW� DQG�WKRVH� ³QRW� UHDOO\� VPDUW´� SURMHFWV�EXUQ�WHQV�RI�ELOOLRQV�RI�GROODUV�

-XVW�WDNH�D�ORRN�DW�*RUJRQ�/1*�

There is something exciting up in the north. Its big, it’s cool, it’s the new darling of the LNG world.

World - meet Alaska LNG.

or the Queensland adventures ZKHUH� GRXEOH� GLJLW�� ELOOLRQV� RI�Dollars have been burnt for some UDWKHU� VPDOO� RXWSXW�� ,I� VRPHRQH�WROG�PH�WKDW�,�ZRXOG�JHW����PLOOLRQ�PHWULF�WRQV�RI�/1*�IRU�D����ELOOLRQ�SOXV� LQYHVWPHQW�� WKHQ� ,�ZRXOG� VD\�that although the total numbers are ELJ��WKH�YROXPH�RI�/1*�LV�YHU\�ELJ�DV�ZHOO�DQG�UHVSHFWLYHO\�,�KDYH�VRPH�ZDUHV�WR�SOD\�ZLWK��

7KH� RQO\� UHPDLQLQJ� TXHVWLRQ�ZRXOG�WKHQ�EH��ZKDW�HHFW�VR�PXFK�LNG at once would have on the PDUNHW"� %XW� ,�ZRXOG� VWLOO� KDYH� DOO�WKLV�/1*�,�FDQ�VHOO�

,Q�*RUJRQV�FDVH�� LW¶V�PXFK� OHVV�WKDQ� ��� PLOOLRQ� PHWULF� WRQV� EXW�UDWKHU�� FORVHU� WR� ���PLOOLRQ�PHWULF�WRQV�� 7KLV� PDNHV� WKH� SURGXFHG�

/1*�UHDOO\�H[SHQVLYH�6RPH� PLJKW� VD\�� WKDW� LW¶V� QRW�

fair to compare Australian projects ZLWK���OHW¶V�VD\�WKH�4DWDULV���DV�WKH�conditions put in place by the Australian environmentalists are YHU\� H[SHQVLYH� WR� IXO¿O� DQG� WKDW�WKHUH�LV�QR�RWKHU�ZD\�WR�H[SORLW�WKH�JDV� UHVHUYH� RWKHUZLVH�� %XW� WKHQ� ,�DVN��VLQFH�ZKHQ�LV�EXVLQHVV�IDLU�DQG�why is it that when a gas reserve has EHHQ�IRXQG��HYHQ�LI�LW¶V�ZRUOG�FODVV��WKDW�LW�PXVW�DEVROXWHO\�EH�H[SORLWHG�DW�DOO�FRVW�RU�HRUWV��/HW�PH�VD\�WKLV�DJDLQ�MXVW�WR�SXVK�WKH�SRLQW�D�ELW�

2QFH� D� ZRUOG� FODVV� UHVHUYH� �,�attach this quality only with respect WR� VL]H�� WKHQ� ±� DV� FRQYHQWLRQDO�wisdom seems to dictate - this reserve must absolutely be

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26NGV Transportation Vol. 20 Oct - Dec 2014

SPECIAL REPORT

H[SORLWHG� QR�PDWWHU�ZKDW� WKH� FRVW�DQG� RWKHU� LPSOLFDWLRQV�� ,V� WKLV�really true?

:KHQ� ,� ZDV� D� JDV� IUHVKPDQ�� ,�learned the notion of a stranded gas ¿HOG��7KLV�ZDV�D�¿HOG�WKDW�DOWKRXJK�contained gas that would be very nice to have in Europe or some RWKHU�ZHOO�SD\LQJ�PDUNHW��LV�HLWKHU�located at an impossible place or KDV� WKLQJV� LQ� WKH� JDV� WKDW�PDNH� LW�H[SHQVLYH� WR� UH¿QH� RU� WKH� VWX� LV�hard to get out of the ground or KDUG�WR����

<RX� JHW� WKH� SRLQW"� 6RPH� JDV�reserves should actually never be touched as they contain a poison SLOO�� ([SORLWLQJ� WKHP� XVXDOO\�FRQWDLQV� D� ORW� RI�ZLVKIXO� WKLQNLQJ��style: if this gas would not be in WKH�6RXWKHUQ�$WODQWLF�EXW�UDWKHU�LQ�-DSDQ��LW�ZRXOG�EH�ZRUWK�D�IRUWXQH��

%XW� WKH� VDG� IDFW� LV�� WKDW� LW� LV�ORFDWHG� LQ� WKH� 6RXWK� $WODQWLF� RU�VRPH�RWKHU�LPSRVVLEOH�SODFH��RU�WKDW�it actually does contain astronomic DPRXQWV� RI� VXOIXU� ZKLFK� PDNHV�

it poison gas or that it is placed in D� SHUPDIURVW� VHWWLQJ� WKDW� PDNHV�HYHU\� PRYH� DQ� HFRQRPLF� SDLQ��or that it needs special lifting WHFKQLTXHV�WKDW�PDNH�EULQJLQJ�LW�WR�daylight an arduous campaign and ,�DP� MXVW�FRXQWLQJ�H[DPSOHV�KHUH��Fill in your own reason why it does QRW�ZRUN�

8QOHVV� WKHUH� LV� D� VKLIW� LQ�technology or in business procedures or in operational SUDFWLFH�RU�D�WHFWRQLF�PDUNHW�VKLIW��WKH�H[WUD�HRUW�LV�OLNHO\�QRW�ZRUWK�LW��+LJK�SULFHV�LQ�VRPH�PDUNHWV�IRU�VRPH�\HDUV�LV�QR�VXFK�WHFWRQLF�VKLIW��7KH� LQGXVWULDO� XVH� RI� KRUL]RQWDO�GULOOLQJ� WRJHWKHU� ZLWK� IUDFNLQJ�and operational streamlining as LQ�VKDOH�ZRXOG�EH�VXFK�D�VKLIW��%XW�WKHQ� DJDLQ�� HYHU\WKLQJ� KDV� WR� EH�SXW�LQ�SHUVSHFWLYH�

)RONV��HYHU\RQH�ZKR�NQRZV�PH�DOVR�NQRZV�WKDW�,�DP�DQ�XQDEDVKHG�PHWKDQH� IDQ� DQG� WKDW� ,� UHDOO\�do fancy any new LNG or other PHWKDQH� SURMHFW�� ,� OLNH� ELRJDV�

GHVSLWH�LWV�FXUUHQW�SUREOHPV��,�ORYH�WKH�VKDOH�UHYROXWLRQ��,�GLJ�QHZV�RQ�V\QJDV�DQG�RWKHU�H[RWLF�WHFKQLTXHV��,� ¿JKW� WRRWK� DQG� FODZ� IRU� WKH�LQWURGXFWLRQ�RI�/1*�DV�D� WUXFNLQJ�and shipping fuel as this is much EHWWHU�WKDQ�GLHVHO�LQ�PDQ\�UHVSHFWV��,� DP� D� UHDO� PHWKDQH� D¿FLRQDGR�EXW� FDQ¶W�ZH� DJUHH� WKDW� QR�PDWWHU�KRZ�PXFK�RQH�OLNHV�WKH�PROHFXODU�FRPSRXQG� RU� WKH� EXVLQHVV�� VRPH�SURMHFWV�DUH�MXVW�QRW�ZRUWK�LW�

%DFN� WR� $ODVND� /1*�� 2QH�ZRXOG� EH� IRUJLYHQ� WR� WKLQN� WKDW�GHVWUR\LQJ� YDOXH� �PRQH\�� DW�such a scale cannot be repeated WRR� PDQ\� WLPHV�� 7KH� PDUNHW�ZRXOG� ZDWFK� DQG� OHDUQ� OHVVRQV��6KRXOGQ¶W� ZH� DOO� KDYH� ZDWFKHG�ZKDW� KDSSHQHG� DQG� WDNHQ�precautionary measures? Alarm bells should ring when cost estimates go out of the window E\�QRZ�

%XW�QRQH�RI�WKLV��,W�VHHPV�MXVW�OLNH�WKH�ZRUOG�GRHV�

not want to learn even in the face of

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27 Vol. 20 Oct - Dec 2014 NGV Transportation

SPECIAL REPORT

ORRPLQJ�GLVDVWHU��$XVWUDOLD� VKRXOG�have been a warning to everyone DURXQG�EXW�LW¶V�QRW�

-XVW�ORRN�DURXQG��/1*�SURMHFWV�LQ� 0R]DPELTXH� WKDW� OLNHO\� DUH� VR�H[SHQVLYH�WKDW�WKH\�FDQ�QHYHU�WXUQ�D� GLPH�� 6DPH� IRU� 7DQ]DQLD�� /1*�H[SRUW� SURMHFWV� LQ� WKH�86� WKDW� DUH�only planned and built because someone did not want to admit that WKH�RULJLQDO�UHJDVL¿FDWLRQ�WHUPLQDOV�were as useful for the shale gas LQGHSHQGHQW�$PHULND� DV� D�ZKLVWOH�LV�WR�D�VFXED�GLYHU�

7R�WKH�FDVXDO�REVHUYHU�LW�ZRXOG�MXVW� ORRN� OLNH� WKH� ZRUOG� LV� FUD]\�on LNG and the bigger and more H[SHQVLYH� WKH� SURMHFWV� DUH�� WKH�EHWWHU�� %XW� PDQ\� VHHP� WR� KDYH�IRUJRWWHQ�D�IXQGDPHQWDO�WUXWK�

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+LJK� SULFH� PDUNHWV� KDYH� WKH�XQIRUWXQDWH� HHFW� WR� OXUH� SURMHFW�developers into believing that the %RQDQ]D�ZLOO�JR�RQ� IRUHYHU�EXW�QR�matter how high prices go and no PDWWHU�KRZ�ORQJ�WKH\�KRYHU� WKHUH��LQ� WKH� ORQJ� UXQ�� WKH\�DOZD\V� FRPH�GRZQ�� +LJK� SULFHV� FDUU\� WKHLU�own demise within them as they are the strongest incentive for entrepreneurs and customers to ORRN�IRU�DOWHUQDWLYHV�

$QG� WKH� KLJKHU� SULFHV� JR�� WKH�VWURQJHU�WKH�GUXJ�FDOOHG�EXOO�PDUNHW�EHFRPHV��3URMHFW�GHYHORSHUV�HDVLO\�get addicted to these high prices DV� WKH\� PDNH� PDQ\� SURMHFWV� ��WKDW� ZRXOG� RWKHUZLVH� QHYHU� À\�- worthwhile or sometimes even VHHPLQJO\�SUR¿WDEOH�

)RU�VRPHRQH�GHDOLQJ�LQ�2UDQJH�MXLFH�� WKLV� ZRXOG� QRW� UHDOO\� EH� D�SUREOHP�� ,� GRQ¶W� NQRZ� DQ\WKLQJ�DERXW� WKH�RUDQJH� MXLFH�PDUNHW�EXW�,� ZRXOG� EH� VXUSULVHG� LI� DQ� RUDQJH�MXLFH�SURGXFHU�ZRXOG�QHHG����\HDUV�RI� VWDEOH� UHWXUQV� LQ�RUGHU� WR�PDNH�KLV�LQYHVWPHQW�ZRUWK�LW�

7KLV�LV�H[DFWO\�WKH�FDVH�LQ�EDVH�

ORDG� /1*�� ,I� \RXU� SURMHFW� QHHGV�D����86'�SHU�PP%WX�RU�PRUH�JDV�PDUNHW�SULFH�LQ�WKH�WDUJHW�PDUNHW�LQ�RUGHU�WR�EH�SUR¿WDEOH��LW�ZRXOG�QHHG�WKLV� SULFH� OHYHO� IRU� ��� \HDUV�� 7KLV�PHDQV� WKDW� LI� WKH�PDUNHW� VOXPSHG�IRU���\HDUV�WR����86'��WKH�SURMHFW�LV�LQ�EDG�WURXEOH�DV�LWV�ORVLQJ�PRQH\�

6RPHRQH�ZLOO�KDYH�WR�WDNH�WKH�KLW�DQG�WKDW¶V�HLWKHU�WKH�FXVWRPHU�of the project who bought way too H[SHQVLYH�DQG�VWDUWV�WR�VXEVLGL]H�its LNG purchasing portfolio with money from healthy operations or the project developer as he cannot generate enough income to cover his installments plus 23(;�DQ\PRUH��

:K\� WKHQ�� VKRXOG� $ODVND� /1*�EH�LQ�WKLV�FODVV"�&RXOGQ¶W�LW�EH�WKDW�the lessons have actually been learned and that they have already EHHQ� DEVRUEHG� LQ� WKH�$ODVND� /1*�business case?

/HW¶V�ORRN�DW�WKH�KLJK�OHYHO�¿JXUHV�WKDW� KDYH� EHHQ� FRPPXQLFDWHG��%HWZHHQ� ��� DQG� ��� ELOOLRQ� 86'�&$3(;� WR� VSHQG� RQ� D� SURMHFW�

WKDW�ZLOO�SURGXFH�XS� WR����PLOOLRQ�PHWULF�WRQV�RI�/1*�SHU�\HDU��7KDW¶V�D� ZKRSSLQJ� ����� WR� ����� ELOOLRQ�86'� SHU� PLOOLRQ� PHWULF� WRQV� RI�FDSDFLW\�RU������WR������86'�SHU�WRQ�RI�FDSDFLW\�

+DYHQ¶W�ZH�EHHQ�DW�VRPHZKHUH�DURXQG� ���� 86'� SHU� WRQ� RI�capacity already or below in other projects? No matter how real they PLJKW�KDYH�EHHQ�RU�QRW��WKLV�LV�D���WR���IROG�LQFUHDVH�LQ�FDSLWDO�FRVWV�DQG�,�ZLOO�EH�GDPPHG�LI�23(;�LQ�$ODVND�DUH�RQ�WKH�FKHDS�VLGH��,�H[SHFW�WKH�same environmental conditions as ZH�KDYH�VHHQ�LQ�$XVWUDOLD�

Another huge pile of money EXUQW�� $QG� ,� DP� QRW� HYHQ� WDONLQJ�DERXW� FRVW� RYHUUXQV� ULJKW� QRZ��All the new Aussie projects have been plagued by runaway costs but FRRO�$ODVNDQV�SUREDEO\�KDYH�KLUHG�3RODU� EHDUV� DQG� NHHS� WKHP� RQ� DQ�RDWPHDO�GLHW�WR�PDNH�WKHP�NHHS�WKH�QXPEHUV�DJJUHVVLYHO\�LQ�FKHFN��

Rudolf is an entrepreneur and consultant active in the “methane based fuels and energy” industry. He is the founder of countless initiatives all with the aim to promote a methane based economy and affordable environmental protection.

He is a professional business developer and negotiator who is involved in all aspects of the LNG business. He is also very actively promoting green technologies that work well with methane based technologies.

Rudolf has helped secure first Regasification capacity for his former employer EconGas at the GATE terminal in 2007 and holds a Masters degree in Commercial and Taxation law from the Jean Monnet faculty in Paris. He also runs a number of blogs, among them www.lng.guru and www.lng.jetzt.

RUDOLF HUBER

NTM By Rudolf Huber

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28NGV Transportation Vol. 20 Oct - Dec 2014

ROLLING IN THE DEEP ?A perspective on the future of Indonesia’s maritime industry as we enter the golden age of gasPresented at SMALL LNG SHIPPING & DISTRIBUTION FORUM 2014, Padma Resort Bali, Sept 17th, 2014

: e are all happy QRZ´�� RQH� RI�WKH� ,QGLDQ�farmers told CNN that

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29 Vol. 20 Oct - Dec 2014 NGV Transportation

8OWUD�/RZ�)XHO�'LHVHO��8/)'���,Q� WKH� SHUVSHFWLYH� RI� GLHVHO�

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30NGV Transportation Vol. 20 Oct - Dec 2014

,Q� WKLV�PRGHO�� FRPSDULVRQ� RI� WKH�UHWUR¿W� IRU� WKUHH� NLQGV� RI� YHVVHO�diesel engines and gas engines was PDGH��7KH�SD\�EDFN�SHULRG�ZDV�DW�OHDVW� ��� \HDUV� IRU� WKH� PRGHOOHG�vessel with the scenario of using an on-shore LNG plant facility with a liquefaction capacity of ��������JDOORQV�SHU�GD\�LQ�PLQG��:LWK� WKH�PRGHOHG�/1*�SODQW�� DQ�LQWHUQDO� UDWH� RI� UHWXUQ� �,55�� RI����� ZDV� XVHG� DQG� D� PLQLPXP�LNG price was dictated to satisfy WKH� LQYHVWPHQW� FULWHULD�� ,Q� WKLV�PRGHO��RQH�RI�WKH�FRQFOXVLRQV�ZDV�that the delivered price of LNG will be dictated by the capacity RI� XWLOL]DWLRQ� RI� WKH� SODQW�� 7KH�delivered price of LNG will be as much as two times if the LNG SODQW�XWLOL]DWLRQ� FDSDFLW\� LV� ORZHU�WKDQ� ����� ,Q� WKLV� VHQVH�� RQH� FDQ�understand that the strategy of LNG production infrastructure has an important role that dictates WKH�GHOLYHUHG�/1*�SULFH��7KH�FRVW�of production and/or distribution

of LNG can double the price of QDWXUDO� JDV� DV� FRPPRGLW\�� $�good strategy for a distribution or liquefaction facility should be used to help reduce the ccost of WKH�GHOLYHUHG�/1*�

,W� LV� DOVR� LPSRUWDQW� WR�understand that the cost of the UHWUR¿W�� LQFOXGLQJ� WKH� UHWUR¿W� RI�the engine and the fuel system is DOVR� TXLWH� FRVWO\�� $Q� HVWLPDWLRQ�IURP� 5R\DO� ,QVWLWXWH� RI� 1DYDO�$UFKLWHFWV��5,1$��SUHVHQWHG�DW�WKH�0DUH� )RUXP� LQ� ������PHQWLRQHG�WKDW�WKH�FRVW�RI�UHWUR¿WWLQJ�LV�DERXW����� �� ���� RI� WKH� YHVVHO� SULFH��*LYHQ�WKH�KLJK�FRVW�RI�FRQYHUVLRQ��RQH� NH\� WRZDUG� WKH� VXFFHVV� RI� D�UHWUR¿WWLQJ� SURMHFW�� LV� WR� WDUJHW� D�YHVVHO� ZLWK� � KLJK� XWLOL]DWLRQ� DQG�annual fuel use such that one FDQ� PD[LPL]H� DQQXDO� IXHO� FRVW�VDYLQJV�� ,Q� WKLV� SHUVSHFWLYH�� DQ�H[DPSOH�RI�WKLV�NLQG�RI�YHVVHO�ZLOO�be an ocean going tug boat or a FUXLVH�IHUU\��,Q�RUGHU�WR�PD[LPL]H�IXHO� FRVW� VDYLQJV�� WKH� YHVVHO� DOVR�has to use distillate fuel oil instead RI�UHVLGXDO�IXHO�RLO��7KLV�LV�PDLQO\�because the residual fuel has a ORZHU� SULFH� WKDQ� GLVWLOODWH� IXHO��thus reducing the economic gain KDG� WKH� YHVVHO� XVHG� JDV� LQVWHDG��Another challenge today that VKRXOG�EH� FRQVLGHUHG��ZLOO� EH� WKH�GHVLJQ�RI�JDV�IXHOOHG� VKLSV��6RPH�design notes will be with regards WR�WKH�/1*�IXHO�WDQN�ORFDWLRQ�DQG�

EXQNHULQJ�� %HFDXVH� RI� WKH� ORZHU�heating value of gas compared ZLWK�OLTXLG�IXHO��WKH�YROXPH�RI�JDV�VWRUDJH�LQ�WKH�YHVVHO�ZLOO�EH���±���times larger than the volume of liquid fuel space given our current WHFKQRORJ\�� 7KH� UHIXHOLQJ� WLPH� LV�also related to the design of the JDV� VWRUDJH� RQ� WKH� YHVVHO�� 7KH�refuelling time goes hand in hand with the volume of gas that can be VWRUHG�RQ�WKH�YHVVHO��(YHU\�VLQJOH�meter of space on a commercial vessel is counted and by the nature RI� DQ\� VHD� ERXQG� YHVVHO�� VSDFH� LV�H[WUHPHO\�OLPLWHG��3D\�ORDG��YHVVHO�displacement and gas engine consumption are main factors for JDV� VWRUDJH� GHVLJQ� DQG� DV� VXFK��WKHUH�ZLOO�DOZD\V�EH�D�WUDGH�R�IRU�RQH�RU�WKH�RWKHU��

%DFN� WR� WKH� TXHVWLRQ� LQ� WKH�beginning: are we entering the JROGHQ�DJH�RI�JDV"�:KDW�,�FDQ�WHOO�\RX� KHUH� LV� WKDW� E\� ������ DW� WKH�2O\PSLF�JDPHV�LQ�5LR�'H�-HQHLUR��the catamaran aluminium ferry currently being built in China will be using a dual fuel gas engine with compressed natural JDV� �&1*�� VWRUDJH� LQ� WKH� YHVVHO��And based on the facts discussed DERYH�� ,� WKLQN� ZH� DUH� VWDUWLQJ� WR�enter the golden age of gas and there is nothing we can do but roll across the deep seas into a bright JDV�¿OOHG�IXWXUH�

H e r u H e r m a wa n c u r r e n t l y works at PT T r a k i n d o Utama; a Cate rp i l la r dealer in I n d o n e s i a ,

as Marine Product Manager Power System Division. He graduated from the Marine Engineering Institute of Technology in Surabaya in 2000 and received a Masters Degree from Prasetiya Mulya Business School in 2009.

E:[email protected] : @heruHN

HERU HERMAWAN

NTM By Heru Hermawan

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SPECIAL REPORT

LNG IMPORT DIVERSIFICATION

in Asia,QWURGXFWLRQEfficient energy-importing SRUWIROLRV� DLP� WR� PLQLPL]H�QDWLRQDO� H[SRVXUH� WR� SULFH�IOXFWXDWLRQV�� FRPPHQVXUDWH�with creating optimal overall LPSRUWLQJ� FRVWV�� :KHQ� HQHUJ\�VXSSO\� VRXUFHV� DUH� GLYHUVLILHG��the power controlled by a VLQJOH� VXSSOLHU� LV� GLPLQLVKHG��Having multiple suppliers provides security and reduces vulnerability in cases of temporary or permanent GLVUXSWLRQ� RI� VXSSO\�� 6KRXOG�one supplier fall victim to QDWXUDO� GLVDVWHUV�� WHUURULVP��ZDU�� UHJLPH� FKDQJH�� RU� RWKHU�H[SRUW� GDPDJLQJ� HYHQWV��LPSRUWHUV� ZLOO� RQO\� H[SHULHQFH�minor disruptions to their WRWDO� VXSSO\�� *LYHQ� WKDW� HYHQ�small increases in energy prices FDQ� \LHOG� VL]HDEOH� HFRQRPLF�losses through unemployment DQG� ORVW� LQFRPH�� DV� ZHOO� DV�the loss of value for financial DQG� RWKHU� DVVHWV�� GLYHUVLI\LQJ�LPSRUWV� WR� FKHDSHU� VXSSOLHUV��is theoretically a sound strategy aimed at reducing import costs and building a truly integrated JOREDO�/1*�PDUNHW��

Diversification of supply sources has been a strategy employed by Asian governments

WR� LPSURYH� HQHUJ\� VHFXULW\��enhance bargaining power vis-à-vis individual producers and ultimately secure more FRPSHWLWLYHO\� SULFHG� JDV�� $�diversified LNG import strategy is one which sources LNG from DV� PDQ\� VXSSOLHUV� DV� SRVVLEOH��thereby minimising the potential for supply disruption and reducing import costs by aiming to enhance physical arbitrage between prices DFURVV� UHJLRQDO� /1*� PDUNHWV��Relying on a single source for /1*� LPSRUWV�� LQ� JHQHUDO�� LV� IDU�ULVNLHU� WKDQ� LPSRUWLQJ� /1*�IURP�PXOWLSOH�VRXUFHV��

:KLOH�EHFRPLQJ�LQFUHDVLQJO\�LPSRUW�GHSHQGHQW��ILJ������$VLDQ�/1*�LPSRUWHUV�VHHN�WR�GLYHUVLI\�WKHLU� VXSSOLHU� PL[� DV� PXFK� DV�possible to lower the prices and to reduce economic vulnerability to future disruptions or the failure of any one producer to SURYLGH�DGHTXDWH�VXSSOLHV��7KLV�portfolio approach mitigates WKH� ULVNV� RI� WKH� LQWHUQDWLRQDO�QDWXUDO� JDV� PDUNHW� SURYLGHG� LW�is accomplished with acceptable HFRQRPLF� DQG� SROLWLFDO� FRVWV��Despite similarities in the objective of diversifying LPSRUWV�� SDWWHUQV� RI� LPSRUW�diversification vary from case to

FDVH�� ZLWK� FRQFRPLWDQW� HIIHFWV�RQ�HQHUJ\�VHFXULW\��$JDLQVW�WKLV�EDFNGURS�� WKLV� SDSHU� H[SORUHV�PDMRU� UHJLRQDO� LPSRUWHUV¶�approaches to LNG import GLYHUVLILFDWLRQ� DQG� H[SODLQV�why patterns of LNG imports GLIIHU�EHWZHHQ�VWDWHV�

0HWKRG,Q� RUGHU� WR� DVVHVV� DQG� DQDO\VH�LNG import diversification SRUWIROLRV� RI� $VLD¶V� ILYH� PDMRU�LPSRUWHUV�±�&KLQD��,QGLD��-DSDQ��6RXWK�.RUHD�DQG�7DLZDQ�±� WKLV�paper adopts the Herfindahl-+LUVFKPDQQ� LQGH[� �++,�� RI�PDUNHW� FRQFHQWUDWLRQ�� 7KH�+HUILQGDKO�+LUVFKPDQQ� LQGH[�is calculated according to

I++,� ���SLð�� � �

� ������L �

where pi is the proportion of LNG imports from the ith /1*�H[SRUWLQJ� FRXQWU\�� 7KH�++,� ULVHV� WR� WKH� PD[LPXP�YDOXH� RI� �� LI� /1*� LV� LPSRUWHG�IURP�RQO\�RQH� FRXQWU\��$� YDOXH�RI����RU�FORVH�WR�LW��LQGLFDWHV�ORZ�OHYHO� RI� GLYHUVLILFDWLRQ�� KLJK�concentration and dependence on one or very few sources of LNG that may threaten the security of supply in the event RI� DQ\� VXVWDLQHG� LQWHUUXSWLRQ��$� YDOXH� RI� ��� RU� FORVH� WR� LW��indicates a high level of GLYHUVLILFDWLRQ�� ZLWK� QXPHURXV�VRXUFHV� RI� LPSRUWHG� /1*��none of which play a dominant UROH�� 6XFK� D� V\VWHP� FDQ� EH�considered reasonably secure in the face of interruption in DQ\� SDUWLFXODU� /1*�H[SRUWLQJ�FRXQWU\�� ,Q� WHUPV� RI� H[SRUWHU�GLYHUVLILFDWLRQ�� WKH� ++,� ULVHV�WR� WKH� PD[LPXP� YDOXH� RI� �� LI�WKHUH�LV�RQO\�RQH�/1*�H[SRUWHU��$� YDOXH� RI� ��� RU� FORVH� WR� LW��LQGLFDWHV� ORZ� OHYHO� RI� H[SRUWHU�GLYHUVLILFDWLRQ�� $� YDOXH� RI���� RU� FORVH� WR� LW�� LQGLFDWHV� D�

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SPECIAL REPORT

KLJK� OHYHO� RI� GLYHUVLILFDWLRQ��with numerous global LNG H[SRUWHUV��QRQH�RI�ZKLFK�SOD\�D�GRPLQDQW�UROH�

7KH� PDLQ� VRXUFHV� RI� GDWD�DUH� WKH� DQQXDO� %3� 6WDWLVWLFDO�5HYLHZ�RI�:RUOG�(QHUJ\������������� DQG� WKH� DQQXDO� UHSRUWV�SXEOLVKHG� E\� WKH� ,QWHUQDWLRQDO�Group of Liquefied Natural Gas ,PSRUWHUV� �*,,*1/��� HQWLWOHG�7KH�/1*�,QGXVWU\�������������

5HVXOWV�DQG�GLVFXVVLRQ7KH�UHVXOWV�IRU�,QGLD�DQG�&KLQD�LV� DQDO\VHG� IRU� WKH� ����������SHULRG� �,QGLD�� DQG� WKH� ���������� SHULRG� �&KLQD��� DV� WKHVH�two countries did not import DQ\� /1*� SULRU� WR� ����� DQG�������UHVSHFWLYHO\��

,W� LV� DSSDUHQW� IURP� �)LJXUH��� that all of the regional LNG import portfolios have become more diversified over the past GHFDGH��$W�WKH�VDPH�WLPH��WKHUH�LV� PXFK� FRQWUDVW� LQ� WKH� H[WHQW�of LNG import diversification IRU� WKH� ILYH� $VLDQ� FRXQWULHV��,Q� SDUWLFXODU�� DV� PHDVXUHG�E\� WKH� ++,�� WKH� VRXUFHV� RI�/1*� LPSRUWV� IRU� -DSDQ� DQG�6RXWK� .RUHD� KDYH� EHHQ� PRVW�GLYHUVLILHG�� GLYHUVLILFDWLRQ� RI�&KLQD¶V� VRXUFHV� RI� LPSRUWHG�LNG has improved dramatically since it became an LNG

LPSRUWHU� LQ� ������ ZLWK� PLQRU�GHWHULRUDWLRQ� VLQFH� ������DQG� ZKLOH� ,QGLD¶V� SRUWIROLR� RI�LNG imports has continually LPSURYHG� XQWLO� ������ LW� KDV�EHFRPH�OHVV�GLYHUVLILHG�VLQFH�

&KLQD8SRQ� LWV� VKLIW� WR� DQ� /1*�LPSRUWHU� LQ� ����� &KLQD� ZDV�largely reliant on Australia for LPSRUWHG� /1*�� %HWZHHQ� �����DQG�������RYHU�����RI�&KLQD¶V�imported LNG originated from $XVWUDOLD�DQG��DV�D�FRQVHTXHQFH��&KLQD¶V�++,�ZDV�DW�D� UHODWLYHO\�low level during the early years DV�DQ�LPSRUWHU��$V�&KLQD¶V�WKLUVW�IRU� LPSRUWHG� /1*� LQFUHDVHG��as part of its broader energy GLSORPDF\�� &KLQD� H[SDQGHG�its relations with other energy VXSSOLHUV�� DQG� LPSRUWV� IURP�,QGRQHVLD�� 0DOD\VLD� DQG� 4DWDU�HDFK�PDGH�XS�PRUH�WKDQ�����RI�RYHUDOO�LPSRUWV�E\�������$�SXVK�WR� GLYHUVLI\� FRQWLQXHG� LQ� ������and while still the largest source RI� LPSRUWHG� /1*�� $XVWUDOLD¶V�VKDUH� LQ� &KLQD¶V� /1*� LPSRUWV�GURSSHG�WR�OHVV�WKDQ����SHU�FHQW��:KLOH� LQ� RQO\� ILYH� \HDUV� �IURP������ WR� ������ &KLQD¶V� /1*�import profile was transformed from being dominated by one country to a profile which H[KLELWHG� D� UHODWLYHO\� KLJK�

GHJUHH� RI� GLYHUVLILFDWLRQ��&KLQD¶V� /1*� LPSRUWV� IURP�4DWDU� LQFUHDVHG� VLJQLILFDQWO\��WR�����RI�WKH�RYHUDOO�LPSRUWV�LQ�������FRPSDUHG�WR�����LQ������

,QGLD,QGLD�VWDUWHG�LPSRUWLQJ�/1*�LQ�������DQG�LQ�WKH�ILUVW�WZR�\HDUV�LW�ZDV�DOPRVW�H[FOXVLYHO\�UHOLDQW�RQ� 4DWDU� IRU� /1*� LPSRUWV��8QOLNH�&KLQD��ZKLFK�GLYHUVLILHG�away from Australia soon after EHFRPLQJ� DQ� /1*� LPSRUWHU��,QGLD� KDV� UHPDLQHG� ODUJHO\�dependent on Qatar for its LPSRUWV��4DWDU¶V�VKDUH�LQ�,QGLD¶V�LNG imports reached a low of ����LQ�������EHIRUH�UHERXQGLQJ�WR� ���� LQ� ������ 7KLV� ORZ� OHYHO�RI� GLYHUVLILFDWLRQ� LQ� ,QGLD¶V�sources of LNG imports is UHIOHFWHG�LQ�UHODWLYHO\�KLJK�++,��which was at its lowest level in ������ LQFLGHQWDOO\� WKH� \HDU� LQ�which imports from Qatar were DW� WKHLU� ORZHVW� SRLQW�� EHIRUH�UHWXUQLQJ�WR�KLJKHU�OHYHOV��

-DSDQ-DSDQ�LV�D�PDWXUH�/1*�LPSRUWHU��with first imports recorded in ����� IURP� $ODVND�� PDNLQJ� LW�the pioneer in the global LNG WUDGH��-DSDQ�UHPDLQV�E\�IDU�WKH�largest LNG importer in the UHJLRQ��%HWZHHQ������DQG�������-DSDQ� LPSRUWHG�DW� OHDVW� ����RI�LNG from the minimum of four FRXQWULHV� HDFK� \HDU�� ,Q� ������$XVWUDOLD�� 0DOD\VLD� DQG� 4DWDU�VXSSOLHG� RYHU� ���� RI� -DSDQ¶V�/1*� LPSRUWV� ZKLOH� %UXQHL¶V�������� DQG� ,QGRQHVLD¶V� �������share dropped below that level LQ� UHFHQW� \HDUV�� 7KLV� GURS�has largely coincided with an LQFUHDVH�LQ�LPSRUWV�IURP�5XVVLD��D�FRXQWU\�WKDW�VWDUWHG�H[SRUWLQJ�/1*� WR� WKH� $VLDQ� PDUNHWV� LQ������� ,Q� ������ 5XVVLDQ� /1*�DFFRXQWHG� IRU� ���� RI� -DSDQ¶V�LPSRUWV��7KH�VKDUH�RI�WKH�8QLWHG�$UDE�(PLUDWHV��8$(��LQ�-DSDQ¶V�LNG imports stood at between ���DQG����WKURXJKRXW�WKH�SDVW�GHFDGH�� IXUWKHU� FRQWULEXWLQJ� WR�

Figure 1: HHI applied to corresponding data for the 5 countries.

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-DSDQ¶V�GLYHUVLILHG�SRUWIROLR��,Q�UHFHQW� \HDUV�� WKH� VKDUH� RI� /1*�LPSRUWV�IURP�4DWDU��1LJHULD�DQG�Equatorial Guinea increased VLJQLILFDQWO\�� :KLOH� ,QGRQHVLD�remained the major supplier IURP������XQWLO�������0DOD\VLD�DVVXPHG� WKDW� UROH� LQ� ����� DQG�������,Q�������$XVWUDOLD�EHFDPH�WKH� ODUJHVW� VRXUFH� RI� -DSDQ¶V�/1*�LPSRUWV��6LQFH�������QRQH�of the suppliers accounted IRU� RYHU� ���� RI� -DSDQ¶V�/1*� LPSRUWV�� 5HIOHFWLYH� RI� D�constantly large number of important LNG suppliers to -DSDQ��DQG�D�GURS�LQ�WKH�ODUJHVW�VXSSOLHU¶V� VKDUH� WR� EHORZ������ -DSDQ¶V� ++,� KDV� EHHQ�consistently low and its import portfolio the most diversified in WKH�UHJLRQ�

6RXWK�.RUHD6LPLODU� WR� -DSDQ�� 6RXWK� .RUHD�LV� D� PDWXUH� /1*� LPSRUWHU��with first imports recorded in ������6RXWK�.RUHD�LV�WKH�VHFRQG�largest LNG importer in the UHJLRQ�� ZLWK� YROXPHV� DOPRVW�equivalent to the combined LPSRUWV� RI� &KLQD�� ,QGLD� DQG�7DLZDQ�� $OVR� VLPLODU� WR� -DSDQ��

GXULQJ� WKH� SDVW� GHFDGH�� 6RXWK�.RUHD� LPSRUWHG� DW� OHDVW� ����RI�/1*�IURP�IRXU�FRXQWULHV��4DWDU��,QGRQHVLD��0DOD\VLD�DQG�2PDQ��HDFK�\HDU��:LWK�D� VKDUH�RI�RYHU�����LQ�RYHUDOO�LPSRUWV�IRU�PRVW�\HDUV��4DWDU�DQG�,QGRQHVLD�KDYH�UHPDLQHG� 6RXWK� .RUHD¶V� PDMRU�/1*�VXSSOLHUV�VLQFH�������%RWK�0DOD\VLD¶V� DQG� 2PDQ¶V� VKDUHV�have dropped from their highs LQ� ����� �0DOD\VLD�� DQG� ������2PDQ��� EXW� ZHUH� UHSODFHG� E\�an increase in imports from ,QGRQHVLD�� 5XVVLD� DQG� <HPHQ��LQ� ����� DQG� ������ DQG� PRVW�LPSRUWDQWO\�� 4DWDU� LQ� �����DQG�������2I� WKH� ILYH� FRXQWULHV�VXUYH\HG��/1*�LPSRUW�SRUWIROLRV�RI�6RXWK�.RUHD�DQG�-DSDQ�KDYH�been the most diversified and constant in terms of low degree RI� DQQXDO� IOXFWXDWLRQ�� 7KH�LPSURYHPHQW� LQ� 6RXWK� .RUHD¶V�LNG import diversification is UHIOHFWHG� LQ� WKH� GURS� LQ� ++,�IURP� D� KLJK� LQ� ����� WR� D� ORZ�LQ� ������ ZKLFK� ZDV� DOVR� WKH�RQO\�\HDU�LQ�ZKLFK�6RXWK�.RUHD�RXWSHUIRUPHG� -DSDQ�� +RZHYHU��with increased reliance of Qatar �IURP� ���� LQ� ����� WR� ���� LQ�������� 6RXWK� .RUHD¶V� LPSRUW�

portfolio has become less GLYHUVLILHG�

7DLZDQ7DLZDQ� LV� DOVR� D� UHODWLYHO\�PDWXUH� /1*� LPSRUWHU�� ZLWK�first LNG imports recorded LQ� ������ $OWKRXJK� 7DLZDQ� KDV�historically been the third largest LNG importer in the UHJLRQ�� JLYHQ� WKHLU� UDSLGO\�JURZLQJ� GHPDQG�� &KLQD� DQG�,QGLD�FDXJKW�XS�LQ�������8QOLNH�LQ� WKH� FDVHV� RI� -DSDQ� DQG�6RXWK� .RUHD�� EHWZHHQ� �����DQG�������VKDUHV�RI�PDMRU�/1*�VXSSOLHUV�WR�7DLZDQ�KDYH�YDULHG�FRQVLGHUDEO\�� ,Q� ������ 7DLZDQ�imported all of its LNG from ,QGRQHVLD� DQG� 0DOD\VLD�� DQG�these two countries accounted IRU� RYHU� ���� RI� 7DLZDQ� /1*�LPSRUWV� XQWLO� ������ +RZHYHU��E\� ������ WKH� VKDUHV� RI� WKHVH�two countries have dropped WR� ���� �0DOD\VLD�� DQG� �����,QGRQHVLD��� 0HDQZKLOH�� 4DWDU�has emerged as the largest VRXUFH� RI� LPSRUWHG� /1*��accounting for almost half of 7DLZDQ¶V� LPSRUWV� LQ� ������ 7KLV�is a massive transformation in 7DLZDQ¶V�/1*�LPSRUW�SRUWIROLR��

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Dr Vlado Vivoda is Research Fellow at the Centre for Social Responsibility in Mining, Sustainable Minerals Institute, at the University of Queensland. Vlado has an extensive publication record on a wide range of topics related to extractive industries. His particular focus is on energy policy and the international political economy of energy. Vlado is also a frequent media commentator on issues related to natural gas, oil and other energy sources.

as there were no LNG imports recorded from Qatar until ������ 5HIOHFWLYH� RI� WKH� GURS�LQ� ,QGRQHVLD� DQG� 0DOD\VLD¶V�VKDUH� LQ�7DLZDQ¶V�/1*� LPSRUWV�VLQFH� ������ 7DLZDQ¶V� ++,� KDV�GURSSHG� IURP� LWV� ����� KLJK� WR�D� ����� ORZ�� ,Q� IDFW�� ����� ZDV�the only year in which no single supplier accounted for more WKDQ� RQH�TXDUWHU� RI� 7DLZDQ¶V�/1*� LPSRUWV�� 7KLV� FKDQJHG�LQ� ����� ZLWK� 4DWDU¶V� VKDUH�LQFUHDVLQJ� VLJQLILFDQWO\� DQG�� DV�D� FRQVHTXHQFH�� 7DLZDQ¶V� ++,�has increased to its highest level VLQFH������

&RQFOXVLRQ2YHUDOO��EHWZHHQ������DQG�������the number of LNG suppliers to the five Asian LNG importers has increased significantly with more LNG producers entering WKH�PDUNHW��7KH�JUHDWHU�QXPEHU�of sources of imported LNG has implied an improved LNG import diversification portfolio IRU� DOO� FRXQWULHV�� SDUWLFXODUO\�XQWLO�WKH�HQG�RI�WKH�SDVW�GHFDGH��

6SHFLILFDOO\�� &KLQD¶V�improvement in LNG import diversification has been QRWKLQJ� VKRUW� RI� VSHFWDFXODU��with the country achieving diversification levels of more PDWXUH� LPSRUWHUV� LQ� RQO\� VL[�\HDUV�DV�DQ�LPSRUWHU��*LYHQ�WKDW�&KLQD¶V�++,�KDV�EHHQ�PDUNHGO\�LPSURYHG� EHWZHHQ� ����� DQG������� DQG� ZDV� ORZHU� WKDQ� WKDW�RI� 7DLZDQ�� D� PDWXUH� /1*�LPSRUWHU��LQ�������LW�LV�DSSDUHQW�WKDW� &KLQD¶V� GLYHUVLILFDWLRQ�policy has been implemented successfully over a short period RI� WLPH�� +RZHYHU�� LQ� ������&KLQD¶V� ++,� GHWHULRUDWHG� DV� D�consequence of greater reliance RQ� 4DWDU�� $OWKRXJK� RXWVLGH� RI�WKH�VFRSH�RI�WKLV�SDSHU��&KLQD¶V�pipeline imports from Central $VLD� DQG�0\DQPDU� �DQG� IXWXUH�LPSRUWV� IURP� 5XVVLD��� DWWHVW�WR� %HLMLQJ¶V� FRPPLWPHQW� WR�GLYHUVLILFDWLRQ� SROLF\�� DQG� ZLWK�increased volumes of natural

gas from Central Asia under FRQWUDFW��ZLOO�IXUWKHU�FRQWULEXWH�WR� &KLQD¶V� GLYHUVLILFDWLRQ� RI�natural gas imports in the long WHUP��7KH�NH\�GHWHUPLQDQW�XQWLO�the end of the decade will be ZKHWKHU�%HLMLQJ�FDQ�VWDELOLVH�LWV�JURZLQJ�UHOLDQFH�RQ�4DWDU�

8QOLNH� RWKHU� PDMRU� $VLDQ�/1*� LPSRUWHUV�� ,QGLD� GRHV�not belong to the East Asian UHJLRQ�� *HRJUDSKLFDOO\�� LW� LV�DSSUR[LPDWHO\�HTXLGLVWDQW�IURP�6RXWKHDVW�$VLD� DQG� WKH�3HUVLDQ�*XOI�� WZR� RI� WKH� PDMRU� /1*�H[SRUWLQJ� UHJLRQV�� $W� WKH� VDPH�WLPH�� DOO� RI� ,QGLD¶V�/1*� LPSRUW�and gasification terminals are ORFDWHG�RQ�LWV�ZHVWHUQ�FRDVW��DQG�consequently the Persian Gulf KDV�EHHQ�SULRULWL]HG�DV�D�VRXUFH�RI� /1*� LPSRUWV�� :KLOH� ,QGLD¶V�LNG import portfolio has become more diversified since it became an LNG importer in ������ WKLV� LPSURYHPHQW� KDV�EHHQ�PDUNHGO\�VORZHU�WKDQ�WKDW�RI�&KLQD��$V�RI�������,QGLD�KDG��E\� D� VLJQLILFDQW� PDUJLQ�� WKH�least diversified LNG import SRUWIROLR� RI� WKH� ILYH� FRXQWULHV��2YHUDOO�� IRU� ,QGLD�� D� JUHDWHU�diversification will be achieved E\� DYRLGLQJ� 4DWDU¶V� DEXQGDQW�VXSSOLHV�� $Q� HIIHFWLYH� VWUDWHJ\�to achieve higher diversification levels would be to increase LQYROYHPHQW� LQ� 6RXWKHDVW�$VLD� DQG� $XVWUDOLD�� DV� ,QGLD¶V�

imports from these regions KDYH� EHHQ� QHJOLJLEOH�� $QRWKHU�effective strategy to increase diversification of imported QDWXUDO� JDV�� PRUH� EURDGO\��would be to build pipelines from surrounding regions that DUH� ULFK� LQ� QDWXUDO� JDV�� <HW��the three proposed pipeline SURMHFWV��IURP�0\DQPDU��0%,���7XUNPHQLVWDQ� �7$3,�� DQG�,UDQ� �,3,��� KDYH� WKXV� IDU� IDLOHG�to proceed due to security and political issues in transit FRXQWULHV��DQG�FRVW�

)RU� PDWXUH� LPSRUWHUV�� VXFK�DV�-DSDQ�DQG�6RXWK�.RUHD��WKDW�have a well-diversified LNG LPSRUW�SRUWIROLR��D�ZD\�IRUZDUG�is to at the very least maintain the levels of diversification they have achieved over the SDVW� GHFDGH�� ,Q� RUGHU� WR� GR� VR��they should avoid becoming overly reliant on any one single VXSSOLHU� �H�J�� 4DWDU��� 7DLZDQ¶V�LNG import portfolio has GHWHULRUDWHG� VLQFH� ����� DV� D�consequence of a large increase in the share of imports from 4DWDU�� ,I� 7DLZDQ� LV� WR� UHDFK�GLYHUVLILFDWLRQ� OHYHOV� RI� -DSDQ�DQG� 6RXWK� .RUHD�� LW� VKRXOG�aim to increase imports from LWV� LPPHGLDWH� UHJLRQ�� DQG�SDUWLFXODUO\� IURP� $XVWUDOLD��,QGRQHVLD�� 5XVVLD� DQG� 3DSXD�1HZ�*XLQHD�

Dr. VLADO VIVODA

NTM By Vlado Vivoda

Page 38: NGV Transportation Magazine

36NGV Transportation Vol. 20 Oct - Dec 2014

EVENT & EXHIBITION

MYANMAR CNG FOR TRANSPORT, INDUSTRY AND POWER FORUM 2014

1st

7 he inaugural Myanmar &1*� IRU� 7UDQVSRUW��,QGXVWU\� DQG� 3RZHU������� FR�RUJDQL]HG�with ANGVA and

0\DQPDU� 1HZ� 7HFKQRORJ\� &R��/WG� �017��� VXFFHVVIXOO\� EURXJKW�WRJHWKHU� ���� KDUG�WR�DFFHVV� ORFDO�VWDNHKROGHUV� LQ� RQH� ORFDWLRQ�� RQH�URRP�����FRXQWULHV�ZHUH�UHSUHVHQWHG�DW�WKLV�IRUXP��7KH�JROG�VSRQVRU�ZDV�+H[DJRQ� DQG� �� H[KLELWRUV� ZHUH�UHSUHVHQWHG� E\� +H[DJRQ� /LQFROQ��6$)(�� /DQGLUHQ]R�� %5&� DQG� *7�$XWRJDV�

.H\� ORFDO� VWDNHKROGHUV� WKDW�DWWHQGHG�� LQFOXGHG� 8� $XQJ� +WRR��'HSXW\� 0LQLVWHU�� 0LQLVWU\� 2I�(QHUJ\��8�0\R�0\LQW�2R���0DQDJLQJ�'LUHFWRU�� 0\DQPDU� 2LO� DQG� *DV�(QWHUSULVH� �02*(��� 8� 3KD\� =LQ�

7XQ�� 'LUHFWRU� *HQHUDO� ±� (QHUJ\�3ODQQLQJ� 'HSDUWPHQW�� 02*(�� 8�$XQJ� .KDLQJ�� 3UHVLGHQW�� <DQJRQ�(OHFWULFLW\�DQG�6XSSO\�%RDUG��8�$XQJ�.KLQ�� 5HJLRQDO� 0LQLVWHU�� 0LQLVWU\�RI� 7UDQVSRUW�� &RO� .KLQ� 0DXQJ�.\DZ�� 'HSXW\� 0LQLVWHU�� 0LQLVWU\�RI� ,QGXVWU\��8�.ZD\�6RH��5HJLRQDO�0LQLVWHU�� 0LQLVWU\� RI� (QHUJ\� �)RUHVW� �� &RO�� 0\R� 0\LQW� �5HWG����0DQDJLQJ� 'LUHFWRU�� %DQGRROD�7UDQVSRUWDWLRQ�&R�� /WG�� &RO�� 7KHLQ�7XQ�:LQ� �5HW��� 'LUHFWRU� ±� 3DUDPL�7D[L�� %DQGRROD� 7UDQVSRUWDWLRQ�&R�� /WG�� &RO�� 7KRXQJ� :LQ� �5HWG���([HFXWLYH� &RPPLWWHH� 0HPEHU��0\DQPDU� (QJLQHHULQJ� 6RFLHW\��&RO�� <LQ�0J�6HLQ� �5HW���'LUHFWRU�±�%XVHV��%DQGRROD�7UDQVSRUWDWLRQ�&R��/WG��8�0\R�&KLW��&KDLUPDQ��)O\LQJ�6ZDOORZ�7UDQVSRUW�DQG�PDQ\�PRUH��

7KH� RSHQLQJ� NH\QRWH� 9,3�address was given by Chief Minister RI�<DQJRQ��8�0\LQW�6ZH��)ROORZLQJ�KLV�RSHQLQJ�VSHHFK��/HH�*LRN�6HQJ��([HFXWLYH�'LUHFWRU��$1*9$�JDYH� D�ZHOFRPLQJ�DGGUHVV�WR�WKH�DXGLHQFH��)ROORZLQJ� WKH� HQG� RI� WKH� VSHHFK��&KLHI�0LQLVWHU�RI�<DQJRQ��8�0\LQW�6ZH��/HH�*LRN�6HQJ�DQG�RWKHU�9,3V�YLVLWHG� WKH� H[KLELWLRQ� DUHD� ZKLOH�KDYLQJ�UHIUHVKPHQWV�

)ROORZLQJ� WKH� EUHDN�� 8� 7XQ�0DXQJ� 0DXQJ�� 'HSXW\� 'LUHFWRU±3URGXFWLRQ�IURP�0\DQPDU�2LO�$QG�*DV� (QWHUSULVH� �02*(��� 0LQLVWU\�2I� (QHUJ\� JDYH� D� SUHVHQWDWLRQ�RQ� ³*DV� 8WLOL]DWLRQ� ,Q� 0\DQPDU��2SSRUWXQLWLHV�$QG�&KDOOHQJHV´��+H�noted that local natural gas demand JURZWK�LV�LQFUHDVLQJ�DW�D�UDWH�RI��������SHU�DQQXP�DQG�0\DQPDU�KDV�D�master plan to increase production DQG� H[SRUW� RI� QDWXUDO� JDV�� 1HZ�GLVFRYHULHV� RI� JDV� FDQ� EH� H[SHFWHG�IURP� ERWK� RQVKRUH� DQG� RVKRUH�EORFNV� DQG� ZLOO� EH� SULRULWL]HG� IRU�GRPHVWLF�VXSSO\��0\DQPDU�KDV�ERWK�RQVKRUH� DQG� RVKRUH� QDWXUDO� JDV�production whereby onshore natural JDV� SURGXFWLRQ� ZDV� ��� PPVFIG�ZKLOH� RVKRUH� SURGXFWLRQ� ZDV������PPVFIG��$OO� RQVKRUH�JDV�ZDV�allocated for domestic consumption ����� IRU� WUDQVSRUW�� ���� IRU�SRZHU�� ���� IRU� LQGXVWULHV�� ���� IRU�IHHGVWRFN�� DQG� ��� IRU� RWKHUV��� )RU�RVKRUH�JDV�������PPVFIG�JDV�ZDV�H[SRUWHG� WR� 7KDLODQG� DQG� &KLQD�DQG�����PPVFIG�ZDV� DOORFDWHG� IRU�GRPHVWLF� FRQVXPSWLRQ� ���� �� IRU�SRZHU�DQG�����IRU�LQGXVWULHV���

2QH�RI�WKH�ELJJHVW�WUDQVSRUWDWLRQ�FRPSDQLHV� XWLOL]LQJ� &1*� DV� IXHO�SUHVHQWHG� QH[W�� &RO�� 0\R� 0\LQW��5HWG���� 0DQDJLQJ� 'LUHFWRU� IURP�%DQGRROD� 7UDQVSRUWDWLRQ� &R�� /WG�gave a focused presentation on ³&1*� &RQYHUVLRQ� DQG� 8VDJH� LQ�0\DQPDU´�� %DQGRROD� RZQV� WKH�3DUDPL� &1*� VWDWLRQ� ±� WKH� ÀDJ�R� ORFDWLRQ� IRU� $1*9$� �����*UHHQ� +LJKZD\V�� 7KH� 3DUDPL�&1*� 6WDWLRQ� LV� ORFDWHG� LQVLGH� WKH�%DQGRROD�7UDQVSRUWDWLRQ¶V�&1*�EXV�GHSRW�� %DQGRROD� 7UDQVSRUWDWLRQ�RSHUDWHV�����&1*�EXVHV�DQG�����WD[LV�DQG�WKH�3DUDPL�&1*�6WDWLRQ�L-R: U Myint Swe, Chief Minister of Yangon & Lee Giok Seng (ANGVA)

MYANMAR CNG FOR TRANSPORT, INDUSTRY AND POWER FORUM 20141st

Forging Ahead with CNG for Transport, Industry and Power Generation

Yangon, Myanmar | 24-25 June 2014

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37 Vol. 20 Oct - Dec 2014 NGV Transportation

EVENT & EXHIBITION

L-R: VIP & Delegates Visiting the Exhibition area

L-R: U Tun Maung Maung (MOGE) & Col. Myo Myint (Retd.) (Bandoola Transportation Co. Ltd)

L-R: U Tun Maung Maung (MOGE) & Col. Myo Myint (Retd.) (Bandoola Transportation Co. Ltd)

also supply CNG to other CNG YHKLFOH�RSHUDWRUV�

7KH� QH[W� SUHVHQWHU� 8� +OD�:LQ�+WD\��*HQHUDO�0DQDJHU��&1*�IURP�0\DQPDU� 2LO� DQG� *DV� (QWHUSULVH��02*(���0LQLVWU\� 2I� (QHUJ\� JDYH�D� GHWDLOHG� SUHVHQWDWLRQ� RQ� ³6WDWXV�RI� &1*� $FWLYLWLHV� � 7HFKQRORJ\�LQ� 0\DQPDU´�� 1*9� LQ� 0\DQPDU�ZKLFK� EHJDQ� LQ� ������ &XUUHQWO\�WKHUH�DUH��������QDWXUDO�JDV�YHKLFOHV�DQG����VWDWLRQV��LQFOXGLQJ�GDXJKWHU�VWDWLRQV�� LQ�IRXU�DUHDV�RI�0\DQPDU�L�H�� 3DOHLN� �0DQGDOD\��� &KDXN��<HQDQJ\DXQJ�DQG�<DQJRQ��0RVW�RI�WKH� QDWXUDO� JDV� YHKLFOHV� ������ DUH�ORFDWHG�LQ�<DQJRQ��$OO�WKHVH�YHKLFOHV�FRQVXPH� DURXQG� ��� PPVFIG� RI�QDWXUDO� JDV�� RI� ZKLFK� FRPHV� IURP�WKH� RQVKRUH� 1\DXQJGRQ� JDV� ¿HOG��He also highlighted the initiative WDNHQ�E\�02*(�WR�HQVXUH�WKH�VDIHW\�of CNG cylinders by establishing D� &1*� &\OLQGHU� 5HFHUWL¿FDWLRQ�&HQWUH�LQ�������,W�LV�QRZ�PDQGDWRU\�for all CNG cylinders installed on-board natural gas vehicles that are ��\HDUV�ROG�RU�PRUH�WR�EH�WHVWHG�DQG�UH�FHUWL¿HG�E\�02*(�

7KH�QH[W�WZR�VSHDNHUV�3XQQDFKDL�)RRWUDNXO�� 9LFH� 3UHVLGHQW� ±� 1*9�0DUNHWLQJ�� 377� 3OF� DQG� &KDLUDQL�5DFKPDWXOODK�� 6HQLRU� 0DQDJHU��� (QHUJ\� 3ODQQLQJ� � (YDOXDWLRQ��37� 3/1� FRQFOXGHG� WKH� ¿UVW� KDOI�RI� 'D\� 2QH�� 3XQQDFKDL� VSRNH� RQ�7KDLODQG¶V�1*9�H[SHULHQFH�ZLWK�WKH�WRSLF�³6XVWDLQLQJ�WKH�1*9�%XVLQHVV�*URZWK�LQ�7KDLODQG´�ZKLOH�&KDLUDQL�VKDUHG� ,QGRQHVLD¶V� VWDWH�RZQHG�HOHFWULFLW\� FRPSDQ\¶V� H[SHULHQFH�LQ� XWLOL]LQJ� &1*�� � 6KH� SUHVHQWHG�RQ� ³&1*� 8WLOL]DWLRQ� IRU� 3RZHU�*HQHUDWLRQ� ±� ([SHULHQFH� IURP�:RUOG¶V� /DUJHVW� &1*� DQG� 6WRUDJH�8WLOL]DWLRQ�8VHU´��

7KH� IRUXP¶V� *ROG� 6SRQVRU��+H[DJRQ� /LQFROQ�� SUHVHQWHG�DIWHU� OXQFK� RQ� WKH� WRSLF� ³(FLHQW�3LSHOHVV� *DV� 7UDQVSRUWDWLRQ� IRU�WKH� 7UDQVSRUW�� ,QGXVWULDO� DQG�3RZHU� *HQHUDWLRQ� 6HFWRUV´��+H[DJRQ� /LQFROQ¶V� 5HJLRQDO� 6DOHV�'LUHFWRU� ±� $VLD� 3DFL¿F�� *RK� 7DW�&KXDQ� JDYH� WKH� SUHVHQWDWLRQ�� /HH�*LRN� 6HQJ�� ([HFXWLYH� 'LUHFWRU��ANGVA gave another presentation

L-R: Chairani Rachmatullah (PT PLN) & Goh Tat Chuan (Hexagon Lincoln)

RQ� ³'HYHORSLQJ� D� 6XVWDLQDEOH�1*9� 0DUNHW´�� -RQDV� *LXOLDQL��$VLD�3DFL¿F�0DUNHWV�'HYHORSPHQW�0DQDJHU� IURP� 6$)(� 6�S�$�FRQWLQXHG�QH[W�ZLWK�D�SUHVHQWDWLRQ�RQ�³&1*�,QIUDVWUXFWXUH�([SDQVLRQ�ZLWK� (HFWLYH� DQG� 7DLORUHG�5HIXHOOLQJ�6ROXWLRQV´��

A Panel Discussion on “Forging $KHDG� ZLWK� &1*� IRU� 7UDQVSRUW��

,QGXVWU\� DQG� 3RZHU� *HQHUDWLRQ´�ZDV� FRQYHQHG� ZLWK� �� SDQHOOLVWV�FRPSULVLQJ� RI� 5REELH� 6XNDUGL��$3*1*,��� 3XQQDFKDL� )RRWUDNXO��377� 3/&��� *RK� 7DW� &KXDQ��+H[DJRQ� /LQFROQ��� DQG� 8� =H\D�7KXUD�0RQ� �0DQDJLQJ�'LUHFWRU�±=H\D��$VVRFLDWHV��0\DQPDU���7KH�Panel Discussion was moderated by /HH�*LRN�6HQJ��([HFXWLYH�'LUHFWRU�

Page 40: NGV Transportation Magazine

38NGV Transportation Vol. 20 Oct - Dec 2014

EVENT & EXHIBITION

L-R: Jonas Giuliani (SAFE) & Panel Discussion

L-R: Col. Thoung Win (Retd.) Myanmar Engineering Society & U Kyaw Kyaw Hlaing (Smart Group of Companies)

L-R: Robbie Sukardi (APCNGI) & Dinh Dang Vu (PetroVietnam Southern Gas)

Site Tour at MOGE’s NGV Refuelling Station and MOGE’s CNG Cylinder 5HFHUWL¿FDWLRQ�&HQWUH�

RI�$1*9$�7KH� VHFRQG� GD\� EHJDQ� ZLWK� DQ�

LPSRUWDQW�RYHUYLHZ�RQ�³7KH�UROH�RI�1DWXUDO�*DV�LQ�0\DQPDU¶V�1DWLRQDO�(QHUJ\� 3ROLF\´�� &RO�� 7KRXQJ� :LQ��5HWG����&KDLUPDQ�RI�WKH�(QHUJ\�DQG�Renewable Energy Committee of WKH� 0\DQPDU� (QJLQHHULQJ� 6RFLHW\�is involved in the preparation of 0\DQPDU¶V�1DWLRQDO� (QHUJ\�3ROLF\�WKDW� LV� H[SHFWHG� WR� EH� DSSURYHG�E\� WKH� JRYHUQPHQW� LQ� VL[� PRQWKV¶�WLPH�� 7KH� 1DWLRQDO� (QHUJ\� 3ROLF\�covers nine sectors including WKH� 2LO� DQG� 1DWXUDO� *DV� 6HFWRU��8QGHU� WKH� 2LO� DQG� 1DWXUDO� *DV�VHFWRU��WKH�SROLF\�REMHFWLYH�LQFOXGHV�H[SDQGLQJ� HQHUJ\� WUDQVSRUWDWLRQ�infrastructure in order to transport HQHUJ\�WR�FRQVXPHUV�DQG�WR�H[SDQG�XWLOL]DWLRQ�SURJUDPPHV�RI�&1*�IRU�oil substitute and LPG as substitute IRU�GRPHVWLF�IXHOV�

7KH�QH[W�VSHDNHU��8�.\DZ�.\DZ�+ODLQJ�� &KDLUPDQ� RI� � 0\DQPDU¶V��6PDUW� *URXS� RI� &RPSDQLHV��SUHVHQWHG� RQ� DQ� ³2YHUYLHZ� RI�WKH� 3RZHU� 6HFWRU� DQG� 2XWORRN�RI� 8WLOL]LQJ� 1DWXUDO� *DV� WR� 0HHW�,QFUHDVLQJ� 'HPDQG´�� � 8� .\DZ�.\DZ� +ODLQJ� KLJKOLJKWHG� WKDW�recoverable natural gas reserves IURP�RVKRUH�RI�0\DQPDU�LV�IURP�RVKRUH�0\DQPDU�LV�DURXQG����WFI�WR����WFI��

7ZR� FDVH� VWXGLHV� RQ� XWLOL]LQJ�&1*�IRU�,QGXVWULHV�ZHUH�SUHVHQWHG�DIWHU� WKH� EUHDN�� 5REELH� 6XNDUGL��President of the CNG Association of WKH� &1*� $VVRFLDWLRQ� RI� ,QGRQHVLD��$3&1*,��VSRNH�³8WLOL]LQJ�&1*�IRU�,QGXVWULHV�DQG�,QGXVWULDO�(VWDWHV�±�&DVH� 6WXG\� ,QGRQHVLD´�� DQG� 'LQK�'DQJ� 9X�� 0DQDJHU� RI� 3ODQQLQJ�DQG� 6DOHV�� 3HWUR9LHWQDP� 6RXWKHUQ�*DV� JDYH� D� ¿QDO� SUHVHQWDWLRQ�RQ� ³(HFWLYH� &1*� 0RWKHU�'DXJKWHU� ,QIUDVWUXFWXUH� DQG� *DV�7UDQVSRUWDWLRQ� IRU� ,QGXVWULHV� LQ�9LHWQDP´�

After lunch the delegation YLVLWHG� 02*(¶V� 1*9� 5HIXHOOLQJ�6WDWLRQ�DQG�02*(¶V�&1*�&\OLQGHU�5HFHUWL¿FDWLRQ�&HQWUH��

,Q� FRQFOXVLRQ�� ¿UVW� PRYHUV¶�DGYDQWDJH� LQWR� 0\DQPDU¶V� &1*�LQGXVWU\�ZLOO�EHQH¿W�WKH�PRVW�IURP�

this highly promising and lucrative PDUNHWSODFH�� 6SHFLDO� WKDQNV� WR� DOO�VSHDNHUV��*ROG�6SRQVRU��([KLELWRUV�DQG� SDUWLFLSDQWV� IRU� PDNLQJ� WKH�LQDXJXUDO� �VW� 0\DQPDU� &1*� IRU�7UDQVSRUW�� ,QGXVWU\� DQG� 3RZHU������D�VXFFHVV�

:H�ORRN�IRUZDUG�WR�ZHOFRPLQJ�\RX�DJDLQ�DW�RXU�QH[W�&1*�HYHQW�

LQ�0\DQPDU�

* Information is also provided by Lee Giok Seng, Executive Director, ANGVA

NTM By Rizal Rahman

Page 41: NGV Transportation Magazine

39 Vol. 20 Oct - Dec 2014 NGV Transportation

AN ANALYSIS OF NATIONAL POLICIES

AND ITS IMPACT ON NGV GROWTH IN DHAKA,

BANGLADESH

L DVW�WLPH��ZH�KDG�D�ORRN�DW�KRZ�WKH�QDWLRQDO�SROLFLHV� LQ� 6LQJDSRUH� KDG� D� GHWULPHQWDO�HHFW�RQ�WKH�JURZWK�RI�1*9V�LQ�WKH�FRXQWU\��Ever wonder what happens when a policy ZRUNV�EHWWHU�WKDQ�H[SHFWHG"�2U�DW�WKH�YHU\�

OHDVW��DSSHDUV�DV�LI�LW�KDV"�7KLV�WLPH�ZH�KDYH�D�ORRN�DW�WKH�LPSDFWV�RI�WKH�SROLFLHV�LPSOHPHQWHG�E\�WKH�%DQJODGHVK�authorities and how being unprepared for growth can KDYH�QHJDWLYH�HHFWV�

7KH� SUL]HG� FDSLWDO� RI� %DQJODGHVK�� 'KDND�� KDV� D�SRSXODWLRQ�RI�VRPH����PLOOLRQ�DQG�LV�RQH�RI�WKH�PRUH�GHQVHO\� SRSXODWHG� FLWLHV� LQ� WKH� ZRUOG�� DW� DURXQG�������� SHRSOH� SHU� NP2�� $V� RQH� FDQ� H[SHFW� LQ� VXFK� D�GHQVHO\� SRSXODWHG� HQYLURQPHQW�� WKHUH� ZHUH� ULVLQJ�FRQFHUQV� DERXW� WKH� DLU� TXDOLW\�� 7KHVH� FRQFHUQV� OHG�the government to consider the use of CNG as a fuel to replace petroleum to reduce harmful emissions and LPSURYH�DLU�TXDOLW\��,Q�DGGLWLRQ�WR�EHLQJ�EHWWHU�IRU�WKH�HQYLURQPHQW�� WKH� JRYHUQPHQW� IDYRXUHG� QDWXUDO� JDV�XVH�DV�%DQJODGHVK�GRHV�SURGXFH�LWV�RZQ�&1*�DQG�KDV�SURYHQ�UHVHUYHV�RI������WFI��

&1*� YHKLFOHV� KDYH� EHHQ� D� SUHVHQFH� LQ�'KDND� IRU�VRPH� ��� \HDUV� QRZ�� 7KH� ¿UVW� &1*� VWDWLRQ� ZDV� VHW�XS� LQ� %DQJODGHVK� LQ� ����� E\� 5XSDQWRULWR� 3UDNULWLN�*DV� &RPSDQ\� /LPLWHG� �53*&/�� ZKLFK� LV� DFWXDOO\�D� JRYHUQPHQW� RZQHG� VXEVLGLDU\� RI� 3HWUR%DQJOD��+RZHYHU��GHYHORSPHQW�ZDV�VRPHZKDW�VORZ�WR�WDNH�R �DIWHU�WKDW��ZLWK�RQO\���PRUH�VWDWLRQV�EHLQJ�FRQVWUXFWHG�E\� ������ 7KLV� OHWKDUJLF� GHYHORSPHQW� LV� DWWULEXWHG�to limited media interest and a poor dissemination of information among consumers and minimal FRPPLWPHQW�IURP�WKH�JRYHUQPHQW�

7KLV� VLWXDWLRQ� KRZHYHU� EHJDQ� WR� FKDQJH� TXLFNO\�toward the better as the advent of the new millennia FORVHG� LQ�� $LU� SROOXWLRQ� ZDV� JHWWLQJ� ZRUVH� GXH� WR� D�ODUJHU�QXPEHU�RI�YHKLFOHV�RQ�WKH�VWUHHW��ZKLFK�VSURXWHG�ULVLQJ� SXEOLF� FRQFHUQ� WKDW� OHG� WKH� JRYHUQPHQW� WR� WDNH�LQLWLDWLYH�WR�SURSHUO\�FOHDQ�XS�WKHLU�DFW��7KLV�ZRXOG�VHH�WKH�JRYHUQPHQW�UHPRYLQJ�WKURQJV�RI�SHWURO�UXQ���VWURNH���ZKHHOHUV� �NQRZQ� DV� EDE\�WD[LV�� ZKLFK� ZKL]]HG�UHOHQWOHVV� DERXW� WKH� FLW\�� 7KLV� SDYHG� WKH� ZD\� IRU� WKH�VWUHHWV� WR� EH� FRPSOHWHO\� ÀRRGHG� ZLWK�PDVVHV� RI� &1*�DXWR�ULFNVKDZV�LQ�'KDND��7KLV�WRRN�SODFH� LQ������DQG�DPRXQWHG�WR�DOPRVW������RI�WKHVH�QHZ�DXWR�ULFNVKDZV�FURZGLQJ�WKH�VWUHHWV��$OPRVW�RYHUQLJKW��D�&1*�UHYROXWLRQ�

WRRN� SODFH�� 7KLV� ZDV� IROORZHG� E\� D� QXPEHU� RI� SROLF\�initiatives that would support the growth in number of PRWRUL]HG�YHKLFOHV�RWKHU�WKDQ�DXWR�ULFNVKDZV�

*RYHUQPHQW�1*9�3ROLFLHV7KH�JRYHUQPHQW�FDUULHG�RXW�WKH�IROORZLQJ�LQLWLDWLYHV�WR�SURPRWH�WKH�XVH�RI�&1*�

��� 3ULYDWH� VHFWRU� ZDV� DOORZHG� IRU� WKH� ¿UVW� WLPH� WR�SDUWLFLSDWH� LQ� UHWUR¿WWLQJ� SHWUROHXP� YHKLFOHV� WR�UXQ� RQ� &1*�� FXUELQJ� WKH� SUHYLRXV�� QRW�YHU\�DFWLYH�PRQRSRO\�RI�53*&/�DQG�D�JRYHUQPHQW�RZQHG�ERG\�

��� 3ULYDWH� VHFWRU� ZDV� DOORZHG� WR� VHW� XS� &1*� ¿OOLQJ�VWDWLRQV��DJDLQ�FXUELQJ�WKH�PRQRSRO\�RI�WKH�53*&/�

���3ULYDWH�VHFWRU�ZDV�HQFRXUDJHG�WR�HQWHU�WKH�LQGXVWU\�E\�PDNLQJ�JRYHUQPHQW�ODQG�DYDLODEOH�WR�WKHP�RQO\�IRU�VHWWLQJ�XS�&1*�¿OOLQJ�VWDWLRQV�

���&1*�DQG�SHWUROHXP�SULFHV�ZHUH�UHVWUXFWXUHG�LQ�RUGHU�WR�PDNH�&1*�PRUH�OXFUDWLYH�DV�D�WUDQVSRUWDWLRQ�IXHO�and subsidies on imported petroleum fuels were HLWKHU�UHGXFHG�RU�UHPRYHG�

��� ,PSRUW� GXWLHV� RQ� &1*� FRQYHUVLRQ�UHWUR¿WWLQJ� NLWV��&1*� VWRUDJH� WDQNV� DQG� UHIXHOOLQJ� VWDWLRQ� UHODWHG�equipment were removed in order to bring down the FRQYHUVLRQ�FRVWV�DQG�H[SHGLWH�FRQYHUVLRQ�UDWH�

���,PSRUW�GXWLHV�RQ�GHGLFDWHG�&1*�EXVHV�ZHUH�UHPRYHG�DQG�RQ�GHGLFDWHG�&1*�DXWR�ULFNVKDZV�ZHUH�UHGXFHG�to encourage more dedicated CNG vehicles on road �DOWKRXJK�FXUUHQWO\�WKHUH�LV�D�EDQ�RQ�LPSRUWLQJ�&1*�DXWR�ULFNVKDZV�IRU�SULYDWH�XVH��

���$OO�JRYHUQPHQW�YHKLFOHV�ZHUH�DVNHG�WR�FRQYHUW�WR�&1*����6DIHW\�FDPSDLJQV�ZHUH�UXQ�WR�HQVXUH�WKH�XVH�RI�SURSHU�

&1*�VWRUDJH�WDQNV�

'HHS�,PSDFW6R�KRZ�H[DFWO\�GLG�DOO�WKHVH�SROLFLHV�DHFW�WKH�JURZWK�RI�1*9V"� �'U��=LD�:DGXG�RI�WKH�8QLYHUVLW\�RI�/HHGV�DQG�%DQJODGHVK�8QLYHUVLW\�RI�(QJLQHHULQJ�DQG�7HFKQRORJ\�KDYH� ZRUNHG� LQ� WKH� DUHD� RI� HQHUJ\� WUDQVLWLRQ� LQ� WKH�

)LJXUH����(YROXWLRQ�RI�&1*�YHKLFOHV��&1*�¿OOLQJ�VWDWLRQV�DQG�&1*�conversion workshops in Bangladesh. Source: Zia Wadud, 2014. Transportation Research Part A (66). p. 102.

CNG policies in place

CNG vehiclesCNG filling stationsConversion workshops

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Page 42: NGV Transportation Magazine

40NGV Transportation Vol. 20 Oct - Dec 2014

WUDQVSRUW� VHFWRU� DQG� UHFHQWO\� ORRNHG� LQWR� WKH� &1*�FRQYHUVLRQ� LPSDFWV� LQ� 'KDND�� � /RRNLQJ� DW� RQH� RI� KLV�JUDSKV�� UHSURGXFHG� KHUH� DV� )LJXUH� ��� ZH� FDQ� VHH� WKDW�WKHUH� ZDV� DOPRVW� QR� GHYHORSPHQW� �UHODWLYHO\�� LQ� WKH�VHFWRU�IURP������WLOO�DURXQG�������7KH�JUDSK�VKRZV�WKDW�VRPHWLPH�LQ������WKHUH�ZDV�D�VXGGHQ�VSLNH�DERYH�WKH�QRUP�DQG�WKHUH�ZDV�D�IXOO�VFDOH�H[SORVLRQ�IROORZLQJ�WKH�JRYHUQPHQW¶V�QHZ�&1*�SROLFLHV�ZKLFK�EHJDQ�LQ�������

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7KHUHIRUH�� LI� &1*� FRQYHUVLRQ� DQG� WKXV� ORZHU�GULYLQJ� FRVWV� KDG� LQFUHDVHG� YHKLFOH� RZQHUVKLS�� WKHQ�the actual vehicle numbers would be larger than the PRGHO�EDVHG� SUHGLFWLRQ� IRU� SRVW�SROLF\� SHULRGV�� 7KH�predicted number of vehicles indeed did not deviate much from the actual number of vehicles for the time period which is shown in )LJXUH���

7KLV� FDQ� EH� H[SODLQHG� E\� WKH� IDFW� WKDW� DV� WKH� QHZ�PLOOHQQLD�FORVHG� LQ�� WKHUH�ZDV�D�JUHDW� LPSURYHPHQW� LQ�WKH�FRXQWU\¶V�*'3�SHU�FDSLWD� LQGLFDWLQJ� WKDW�SHRSOH� LQ�general were earning more and thus had more spending SRZHU�±�EHLQJ�DEOH�WR�DRUG�PRUH�WKDQ�LQ�SUHYLRXV�\HDUV��

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5HVXOWLQJ�&RQJHVWLRQ$OWKRXJK� 'U�� :DGXG� GLG� ¿QG� WKDW� WKH� QXPEHU� RI�vehicles did not increase due to the CNG encouragement SROLF\� RI� WKH� JRYHUQPHQW�� HDFK� YHKLFOH� ZDV� WUDYHOOLQJ�PRUH�DIWHU�FRQYHUVLRQ��7KLV�DGGLWLRQDO�WUDYHO�DJJUDYDWHG�WKH�DOUHDG\�PDVVLYH�WUDF�FRQJHVWLRQ�LQ�WKH�FLW\�� � �'U��:DGXG� FDOFXODWHG� WKDW� WKH� FRQJHVWLRQ� FRVWV� LQ� 'KDND�due to the conversion of vehicles to CNG were increased E\�DURXQG�86�����0LOOLRQ�D�\HDU��

$Q�8QFHUWDLQ�)XWXUH,Q�WKH�ODVW�IHZ�\HDUV��WKH�SULFH�RI�&1*�KDV�EHHQ�UDLVHG�D�QXPEHU�RI� WLPHV� LQ�%DQJODGHVK��VRPHWLPHV�UHJUHWIXOO\�UHGXFLQJ� WKH� SULFH� GLHUHQWLDO� ZLWK� RWKHU� SHWUROHXP�IXHOV��7KLV�LV�HVSHFLDOO\�WUXH�IRU�GLHVHO��ZKLFK�KDV�DOUHDG\�EHHQ�VXEVWDQWLDOO\�VXEVLGL]HG�IRU�LWV�H[WHQVLYH�XVH�LQ�WKH�DJULFXOWXUDO� VHFWRU�� 7KH� VPDOOHU� GLHUHQWLDO� LQ� SULFHV�EHWZHHQ� &1*� DQG� GLHVHO� �DQG� SHWURO�� PHDQV� &1*�FRQYHUVLRQ�RI�WKH�UHVW�RI�WKH�YHKLFOHV�ZLOO�EH�VORZHG��DQG�SRVVLEO\�VWRSSHG�DOWRJHWKHU��

$Q�LQWHUHVWLQJ�SUHGLFDPHQW�WR�VD\�WKH�OHDVW��ZH�FDQ�only hope that the government will help ensure that CNG stays a popular vehicle fuel choice for most of its SRSXODWLRQ��HVSHFLDOO\�LQ�UHODWLRQ�WR�GLHVHO��ZKLFK�LV�IDU�PRUH� SROOXWLQJ� FRPSDUDWLYHO\�� $Q� RGG� FLUFXPVWDQFH�WKDW�ZDV�GLVJXLVHG�E\� WKH� FLW\¶V�SURJUHVV�� VHUYHV� DV� DQ�H[DPSOH�RI�KRZ�SROLF\�DQG�LWV�LPSOHPHQWDWLRQ�FDQ�KDYH�VLJQL¿FDQW�HHFWV�ZKHQ�LPSOHPHQWHG�DW�WKH�ULJKW�WLPH��

*This article draws on the recent paper by Dr. Zia Wadud published in Transportation Research Part A (66), “Transport Impacts of an energy-environment policy: The case of CNG conversion of vehicles in Dhaka.” Dr. Wadud is a University Research Fellow in Transport and Energy at the Centre for Integrated Energy Research at the University of Leeds.

Figure 2: Comparison of actual vehicle registration and model prediction. Source: Zia Wadud, 2014. Transportation Research Part A (66). p. 106.

Figure 3: Evolution of vehicle registration, real GDP per capita and population in Dhaka. Source: Zia Wadud, 2014. Transportation Research Part A (66). p. 105.

NTM By Ryan Pasupathy

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