What is an FLNGV?
The liquefaction of natural gas can take place either onshore or offshore. While all of the US LNG export projects currently being contemplated will use onshore liquefaction, Delfin will instead construct the nation’s first deep-water offshore liquefaction facility.
An FLNGV, or “Floating Liquefied Natural Gas Vessel”, is a vessel that has onboard facilities capable of liquefying and storing natural gas while floating on a body of water.
While Delfin’s FLNGVs will be the first of their kind in the United States, all of the technologies used have been validated and used as part of onshore projects for over 40 years. Delfin will simply apply these existing technologies in an offshore format, which we believe provides several advantages over onshore liquefaction facilities.
FLNGVs provide several advantages over onshore liquefaction facilities:
- More Environmentally Friendly: Floating liquefaction plants can be located far away from populated areas, do not involve any onshore construction, and can be floated away when they are no longer needed.
- Faster to Build: FLNGVs are smaller and simpler to build than onshore facilities, resulting in construction timelines that are 1-2 years shorter.
- Movability: Each FLNGV will be anchored to a mooring, from which it can easily be detached if there is a hurricane or other circumstances requiring re-location.
- Contract Flexibility: Onshore projects require 20-year contracts to cover their significant capital costs, while FLNGV projects have the flexibility to offer 10 or 12-year contracts as well.
- FLNGVs are Similar to FSRUs: When exported LNG arrives at the importing nation, it must be converted back into a gaseous form before being transported by pipeline. Ten years ago, this “regasification” process was done entirely onshore, but today it is very often done offshore on an FSRU, or “Floating Storage and Regasification Unit”. We believe that, like FSRUs, FLNGVs will increasingly become a mainstream component of the LNG supply chain.
- Endorsed by Market Participants: FLNGVs are endorsed by major shipbuilders, engineers, gas buyers and others who recognize that the technology has been validated.