The LNG Futures Facility: Physical & Virtual LNG Plants for Technology

Demonstration and Industrial Training

Professor Eric F. May

H2 Export Workshop29 November 2018

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ARC Centre NERA ConsortiumARC ITTC awarded in May 2015 Launched in April 2016

$9 million over 5 years - 11 Projects

NERA Living Lab Feasibility StudyLNG Futures Facility Phases 1 & 2

Scaling Up Research & Development

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Bench - ScaleMicron - Scale Pilot - Scale

Gas

Se

para

tions

Cry

ogen

ic

Flui

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ow

Assu

ranc

e

API & DNV Recommended Practice for Qualification

Technology Readiness Levels (TRL) 0 to 7

Valley of Death: TRL-3 to TRL-4

No accessible, live environment exists for demonstrating new

technologies & processesat industrial scale

Result: barrier to innovation & technology adoption by industry

LNG Futures FacilityIndustrial Scale Research & Demonstration

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See video at: www.youtube.com/watch?v=zxT13tSWaMU&feature=youtu.be

or https://lngfutures.edu.au/lng-futures-facility/

Phase 1: Concept Select & pre-FEED

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REGASIF-ICATION R&D

500 GJ/d12k SCMD

10 tpd5k gpd

Slipstream facilities allow introduction and disposal of impurities as required for testing

More & better instrumentation than industrial plants

Qualify “Digital Twins”

Small-scale train provides convenient access to full range of gas conditions from feed to LNG storage

Slipstream facilities provide relevant fluids for technology demonstration of new sensors & new operations

Amines

Gas recycle allows operating cost to be minimised

Mol sieve

SMR

Location, Gas Source & Disposal

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KWINANA BULK TERMINAL INDUSTRIAL AREA

Location: Kwinana Industrial Area, 25 km south of Perth.Gas Source & Disposal: Two options appear most financially viable

PERTH , WESTERN AUSTRALIA

Dampier-Bunbury Natural Gas Pipeline

Site A: Gas offtake from Kleenheat LNG plant’s feed, disposal of LNG via vacuum insulated pipes back to Kleenheat storage. Site B: Gas offtake & return from Dampier-Bunbury Pipeline at Compressor Station 10. ~$800,000

Electricity: Self-sufficient gas-engine generator. Facility connected to Mains power for back-up & operation when plant shut-down.

Digitalisation & Industry 4.0

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LNG Futures Facility designated as Testlab by Prime Minister’s Industry 4.0 Taskforce

1. Create & test high-fidelity digital twins – OTS, 3D VR, detailed multiphysics simulators

2. Develop & verify interoperable process control architecture

3. Online data analytics: deliberate plant upsets for validating Big Data models

4. Planning & scheduling technology: verify new shut-down maintenance approaches

November 2017: UWA received Siemenssoftware grant ($450 million value) to support I4.0 Testlab based on LNGFF

September 2018: UWA asked to apply for $1 million from Dept of Industry to establish I4.0 Testlab for Digital Interoperability integrated with LNGFF

Industry 4.0 for Resources SectorDigital Operability for Advanced Process Control

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Current DCS architecture

Proprietary hardware, interfaces and networksVendor-controlled software accessSecurity not intrinsic: bolted-on, not built in

OPA reference architecture

Industry standard interfaces and networksInteroperable hardwareOpen software accessDesigned-in security

Images courtesy of

Digital Interoperability TestlabTesting Industry 4.0 Technologies for the Energy & Resources Sector

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Digital Interoperability I4.0 Lab – Embedded security model ISA-99

On Premises – UWA

Lab - Automated Test Software

Solution

Cloud (AWS)

Level 3 I4.0 Modules

Level 2, Level 3 I4.0 Modules

Level 3 ESB (TIBCO)

Mine Operator Data Feeds

LNG Operator Data Feeds

LNG Futures Facility/Physical Plant

Level 2 Message Bus (RTI)

Level 1,2 Systems

• MOM 4.0 • DIGITAL TWINS 4.0• ANALYTICS 4.0

• PROCESS CONTROL 4.0

• MACHINE 4.0

NERA Project Progress: Phase 1Phase 1 Concept Select & Pre-FEED ($1.05 million - 50% from NERA)

Liquefaction Process Review

Functional Requirements Review

Regulatory Environment Review

Project Kick-Off

Consortium Framing Session

Digital Technology Study

Contractor Scope of Work

Contractor Engagement

Governance Model

Business Case

Market Value Analysis

Contractor Facilities Study

Contractor Facilities Study Findings Report

Consortium Final Briefing

Investor Briefing Session

Phase 2 Planning

Phase 2 Decision

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1. Documented Phase 1 project premises & plan to align Consortium partners.

2. Held framing session to define R&D themes, use cases, and select the core process technologies.

3. Developed Pre-FEED Scope of Work and Functional Specification.

4. Engaged pipeline operators, Kleenheatpersonnel, energy retailers to obtain key information for cost estimation and options screening.

5. Assisted contractor (Clough) by providing input to facility concept and reviewing deliverables (e.g. engineering drawings).

6. Analysed market value of potential R&D projects at the LNGFF.

7. Developed LNGFF business model based on Cooperative Research Centre (CRC) Program.

Class C (30%) Cost Estimate of LNG FF: $30 million

LNG Futures: R&D Themes

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Six research themes for gas processing & LNG research:

1. Gas separation technology – AGRU, Dehydration, Non-cryogenic helium recovery & N2 removal

2. Cryogenic fluids and refrigerants – solids freeze-out prevention and remediation; refrigerant optimization; efficient liquefaction technologies.

3. LNG storage & regasification – Validation of boil-off gas (BOG) and LNG rollover modelling; reducing BOG liquefaction compressor duty (improved sensors, efficient cycles).

4. Data analytics – Validation and demonstration of online data monitoring and analysis software; improved predictive physical models scalable to large facilities.

5. Robotics and automation – Demonstration of remotely operated vehicles (ROVs) for maintenance and inspection; testing of de-manning and remote operation strategies.

6. Accelerated lifecycles – Cryogenic spill tests and development of spill protection technology; qualification of new chemicals and materials (e.g. repeated regeneration of novel zeolites).

New R&D Theme: H2 – liquid or high pressureAugust 2018, Australia’s Chief Scientist & CSIRO release:

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Synergies with Australia’s natural gas & LNG export industry plus regional demand from Japan & Korea make H2 a top R&D priority for AustraliaLNG Futures Facility could readily be extended to provide unique infrastructure for industrial scale R&D on liquid H2 and/or high-pressure H2 (70 MPa)• Materials testing at extreme operating conditions• Standards & codes for handling H2 (gas & liquid)• More efficient compression & storage of H2

Business Model: Cooperative Research Centres

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Cooperative Research Centres (CRCs) funded by Department of Industry provides a well-defined business model following Phase 2 (FEED) & FID• Funded ~50-50 by Australian Governments and industry partners• The LNG & H2 CRC would be an incorporated company that owns the LNG FF

initially funded for 10 years (tiered membership, annual payments)• Current average cash funding of $44M per CRC.

CRC Program Funding

($931.2M, 22%)

Participant, cash ($650.1M,

15%)

Participant, in-kind ($2694M,

63%)

Funding for 36 Current CRCs $25M government

funding

$17.48M government

funding

$34.45M government

funding

LNG & H2 CRC – Proposed Structure

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Not‐For‐Profit Company, Limited by GuaranteeOwner of LNG FF infrastructure and IP

Administration

Includes CEO, COO, and Research Coordinator 

(Admin. & Engagement). 

Industry Research Panel

Representatives of participants who help design and prioritise research programs. 

Eight Directors

4 independent & 4 representative directors 

Each with business compliance obligations.

Independent Chair

Initially identified by the ACLNGF then by Board

CRC Activity

R&D Program 1:LNG & Natural Gas Processing

Program Leader, Technician, Researchers

R&D Program 2:H2 Processing & Liquefaction

Program Leader, Technician, Researchers

R&D Program 3:Storage & Re‐gasification

Program Leader, Technician, Researchers

Industry 4.0 Digital Interoperability Testlab Researchers 

Project 1

.1

Project 1

.2

Project 1

.3

Project 2

.1

Project 2

.2

Project 2

.3

Project 3

.1

Project 3

.2

Project 3

.3

... ... ...

LNG & H2 CRC: Proposed Governance

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MembershipFounding (Phase 1 & 2) – Board repTier 1 – $300k pa (approx 5 orgs)Tier 2 – $150k pa (approx 7 orgs)Industry Research Panel: 1 vote/$150kNew members admitted by IRP vote

Intellectual Property & CommercializationIP from collective research program owned initially by CRC companySeed commercialization funding from CRC company (e.g. to PCT stage)Low cost or royalty-free license to IRP membersFurther commercialization offered to IRP members firstCRC licensed to use member & 3rd party IP as needed

LNG FF UseBoard adjusts usage ratios annuallyMember specific projects: >25% of timeCollective program: >25% of timeSMEs: 25% of time, free usePrivate 3rd parties: 25%Charge Private 3rd parties: - Cost + 25% if IP shared- Cost + 50% if IP not shared with CRC

LNG & H2 CRC: Proposed Financial

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$15,000,000

$12,000,000

$17,000,000

$37,250,000

LNG & H2 CRC ‐ 10 year total revenue:$86 million

Tier 1 Partners (x 5) Tier 2 Partners (x 8)WA State Government Dept of Industry (Fed Govt)

$14,500,000

$8,000,000

$3,900,000

$34,000,000

$25,580,000

LNG & H2 CRC ‐ 10 year total expenditure:$86 million

Includes $30 million loan for capital: 10 year term @ 2.5 %

Research programs Board & Management

Other (inc. commercialisation) Loan repayment (capital)

Facility operations

Conclusions

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1. With support from NERA, Chevron, Shell, & Hyundai Heavy Industries, we are working to establish open-access research infrastructure for LNG & H2 Export in Australia: currently named ‘The LNG Futures Facility (LNG FF)’.

2. Technology qualification in a relevant operating environment will benefit both small and medium enterprises (SMEs) and major energy companies working in existing LNG sector OR in new H2 export industry.

3. Establishing an Industry 4.0 Testlab for Digital Interoperability that will interface with the LNG Futures Facility & provide unique training capability for future workforce.

4. CRC application planned for 2019. Industrial-scale research on natural gas & H2utilising unique infrastructure in LNG FF. Consortium includes CSIRO & Curtin.

5. Phase 1 pre-FEED finished: Clough estimates $30 million to build LNG FF. Need to augment with parallel R&D programs & infrastructure to include H2 Export for Phase 2 in 2019.

THANK YOU