LNG is principally used for transporting natural gas to markets, where it is regasified and distributed by pipeline as natural gas. The volume of natural gas can be reduced 600 times by reducing the temperature. LNG is natural gas that has been cooled to a liquid state at minus 260 degrees Fahrenheit. In its liquid state, natural gas can be transported by ship from gas-rich areas of the world to areas where demand exceeds supply. Natural gas plays a vital role in the U.S. energy supply. One of several supply options involves increasing imports of liquefied natural gas (LNG) to ensure that American consumers have adequate supplies of natural gas for the future.
We use natural gas to heat our homes, cook our food, and power our industries. Many electric power plants use clean-burning natural gas to ensure a reliable supply of electricity for our Nation. Currently, natural gas prices in the U.S. are very low. As a result, many domestic power plants are being built or modified to burn natural gas. Moreover, with worldwide demand and domestic supplies both increasing, several of the LNG import terminals in the U.S. have applied to build liquefaction facilities for export.
US LNG Plants
The first LNG export terminal built in the U.S. receives natural gas from production wells near Cook Inlet in southern Alaska. Natural gas is routed to the LNG plant in Kenai, Alaska, where it is liquefied and then exported, primarily to Japan. Recently, several other import terminals have sought approval to build liquefaction facilities for exporting LNG. Depending on gas supply and price differentials, these facilities will be able to import LNG when it is needed in the US and export LNG when the resulting economics dictate.
A domestic gas shortage in the 1970s led to the construction of several import terminals in the U.S. Four import terminals were constructed along the coast of Massachusetts, Maryland, Georgia, and Louisiana. Three of these plants were inactive for many years when both domestic production and imports from Canada increased. However declines in North American natural gas production resulted in the activation of all four plants. Subsequently, in recent years, five more land-based import terminals have gone into operation in Texas, Louisiana, Mississippi, and Puerto Rico. Several offshore unloading terminals have been put into operation as well.
Peak Shaving Plants
The gas shortage in the 1970s also drove the construction of many non-export liquefaction plants. These plants are commonly referred to as LNG peak-shaving plants. Pipeline operators liquefy natural gas when demand is low and store the LNG until demand is high. Storage is facilitated by the volume reduction accomplished through converting the natural gas to a liquid state. During periods of high demand, the LNG is vaporized and injected into either the gas transmission system or a distribution system. Some LNG plants are built similar in construction to peak-shaving plants but the LNG is used for vehicular fuel.
Satellite peak-shaving plants do not include process equipment to convert natural gas to LNG. Instead, trucks deliver LNG for storage on site. Satellite peak-shaving plants typically inject natural gas into distribution systems.
LNG peak-shaving plants typically have significantly less LNG storage capability than an import terminal, but are located at strategic locations in the pipeline system. Storage of LNG enables a reliable supply of natural gas in areas where pipeline capacity limitations and weather conditions may cause supply and demand discrepancies, notably in the northeastern United States. In other words, LNG storage can increase efficiency and reliability in supplying needed energy resources.
Siting LNG Plants - The location and purpose of the LNG plant determines the agencies involved in the decision process for siting the plant.
Safety Inspections of LNG Plants - Responsibilities for safety inspections of LNG plants are shared among FERC, PHMSA, the U.S. Coast Guard and state regulatory agencies.
LNG Plants Connected to Natural Gas Pipeline Systems - Follow this link for a map.