BOC LNG Plant Tasmania, Australia

Construction of BOC's micro-Liquefied Natural Gas (LNG) plant in Westbury in Tasmania, Australia started on 6 August 2009. It was preceded by Meander Valley Council's approval of the company's development application on 14 July 2009 and approval by Tasmania's Environmental Protection Agency in June 2009.

The new plant will produce 50 tons of LNG per day, which is equal to 70,000 litres of diesel. BOC is building the plant to supply LNG for the heavy transport sector in Tasmania. The entire production output from the plant will be supplied to LNG Refuellers Pty Ltd, which is comprised of seven transport operators in Tasmania. The project will cost $A150m.

BOC is part of the Linde Group, a pioneer in LNG production for transportation. BOC anticipates that the plant will showcase the company's capability to implement similar projects in the region. The plant, which is expected to be functional by July 2010, will generate 30 to 40 jobs in Tasmania during construction.

Project finance

Financing for the project has been arranged by BOC. In addition, the project received A$5.05m grant from the Tasmanian Community Forest Agreement Industry Development Program. The development programme is a joint initiative undertaken by the Australian and Tasmanian governments.

Construction

The plant will be built over an area of about 15,400m2 (140mx110m) and is close to the existing gas pipelines. The Tasmanian Resource Planning and Development Commission have granted reclamation of 127ha of rural land in Westbury. The land has been allotted for a new industrial subdivision, which will facilitate the new plant.

BOC has contracted GLP Plant Pty Ltd to design, build and commission the plant. The GLP Group is an Australian company specialising in building plants for gas generation, gas treatment and the petrochemical industry. GLP and BOC will together adopt a design based on detailed hazard and risk assessment to construct the plant, using a robust quality system.

GLP will also build the required supply chain infrastructure, which includes LNG road tankers and six refuelling stations.

Distribution

BOC will supply the LNG fuel to LNG Refuellers Pty Ltd., a consortium of seven Tasmanian transport operators. The consortium consists of Chas Kelly Transport, KJ Padgett Pty Ltd., Aprin Transport, Les Walkden Enterprises, Exeter Sawmill, Country Roadways Pty Ltd. and Kevin Morgan Pty Ltd. They operate 125 natural gas powered heavy duty trucks in Tasmania.

Any fleet operator in Tasmania will also have access to the LNG fuel. LNG Refuellers plans to issue briefings to prospective customers in the Tasmanian transport industry about LNG fuel.

BOC will supply six of its cryostar LNG fuelling stations in Tasmania to establish a pipeline-to-truck fuel supply. The fuelling stations feature state-of-the-art filling system enabling vehicle filling with minimal gas loses.

BOC has also established a refuelling company which owns and operates the refuelling stations. It will handle the fuel logistics demands of many of the Tasmanian fleets which operate on important freight routes.

The main hurdle with adoption of LNG as a transport fuel in Australia is the absence of a nation-wide distribution network. BOC's LNG plant and its six refuelling plants are expected to solve this problem.

Plant details

The facilities at the plant will include a purification division, liquefaction system and a natural gas let-down station. It will also house LNG storage tanks and tanker filling facilities.

The plant will also include a gas offtake pipe from the Tasmania Gas Pipeline to process the gas and store LNG. The offtake pipe will be 25-30m long.

Processing of the gas at the plant includes taking natural gas from the pipeline, which is purified by a process called Amine Absorption process. The process removes carbon dioxide and hydrogen sulphide after which the gas is dried using a molecular sieve bed. The gas is then liquefied using a mixed refrigerant system and stored in tanks, and transported to road tankers for distribution around Tasmania.

Depending upon the increase in the demand for LNG in the future, BOC has plans to develop another module, which will double the plant's output. The company also has plans to construct similar plants across Australia.

Plant history

The LNG plant materialised when BOC, regional transport companies and South West Sustainability Partnership came together to serve mutual interests. The transport companies needed an alternative solution to diesel to insulate themselves from rising and volatile diesel prices. The South West Sustainability Partnership, which consists of the local government and other members, on the other hand, needed an environmentally friendly fuel alternative.

Greenhouse gas emissions from LNG driven vehicles are 20-25% lower compared to diesel. With its price stability and lower greenhouse emissions, LNG emerged as an effective solution from a commercial, economic and environmental perspective for all the parties involved.