CNG – Present Status and 

Future Challenges
Michael Nikolaou
Michael J. Economides
Xiuli Wang
 Nikolaou

Research Project 
Openings
Natural Gas Transportation
• Current
CNG
– 70% via pipeline
– 30% as LNG
CNG Vessels
• Economics
CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

2
 Nikolaou

Research Project 
Openings
Globalization of Gas Trade

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

Source: International Energy Agency 3

 Nikolaou

Research Project 
Openings
Potential CNG Markets

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

4
 Nikolaou

Research Project 
Openings
CNG vs. LNG Marine Transport

CNG CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

LNG
Case Studies

Conclusions

5
 Nikolaou Loading and Offloading Terminals 
Research Project 
Openings
for LNG and CNG 
LNG CNG
CNG

CNG Vessels
At Source

CNG Transport:
CAPEX 
optimization

Case Studies
At Destination
Conclusions

Source: http://www.xgas.us 6
 Nikolaou

Research Project 
Openings
CNG vs. LNG
CNG LNG
CNG

Processing Compressed gas <1:300 gas → liquid → gas

CNG Vessels
(Possibly chilled) (1:600)

CNG Transport: Loading Dehydrate, compress Treat, liquefy, store

CAPEX 
optimization

Terminals Jetty or buoy Jetty or regas offshore

Case Studies

Conclusions Ships Simple – like bulk‐ Sophisticated, efficient

carrier

Receiving Decompress (& heat) – Store, regasify

utilize energy released
7
 Nikolaou

Research Project 
Openings
Marine CNG History

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

Source: companies’ web sites 8

 Nikolaou

Research Project 
Openings
ABS, DNV Approval

CNG • EnerSea (steel, vertical pipes, 

130 bar, ‐29°C)
CNG Vessels • SeaNG (Coselle 275 bar) 
• Knutsen (steel, vertical pipes, 
CNG Transport: 250 bar)
CAPEX  • CETech: (steel, horizontal 
optimization
pipes, 200‐250 bar)
• TransCanada (wrapped steel 
Case Studies liner)
• Trans Ocean Gas (composite)
Conclusions

9
 Nikolaou

Research Project 
Openings
CNG Vessels Trivia
Articulated Tug Ship
Barge
CNG

CNG Vessels

Volume 0.7-2 MMcm 8-29 MMcm

CNG Transport: (25-75 MMscf) (300-1000 MMscf)
CAPEX 
optimization
Loading unloading 0.3-2 MMcm/day 2-14 MMcm/day
rates (10-75 MMscf/day) (75-500 MMscf/day)
Case Studies
Distance 100-1000 km 250-5000 km
(50-500 nautical (135-2700 nautical
Conclusions miles) miles)
Speed <25 km/hr <33 km/hr
(<14 knots) (<18 knots)

Estimated cost $15-35 million $150-350 million

10
 Nikolaou

Research Project 
Openings
CNG Technologies:  Coselles (Compression only)

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

Source: SeaNG 11
 Nikolaou

Research Project 
Openings
CNG Technologies:  Compression and Chilling

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

Source: EnerSea 12
 Nikolaou

Research Project 
Openings
Why Compression and Chilling?

CNG
zT
V~
z P
CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

13
 Nikolaou

Research Project 
Openings
Loading and Offloading

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

14
 Nikolaou

Research Project 
Openings
Natural Gas Transport:  Fixed Cost

CNG
CAPEX Distribution
CAPEX Distribution
CNG Vessels Permanent Assets Flexible Assets
Permanent Assets Flexible Assets
100%
100%
CNG Transport: 90%
90%
CAPEX  80%
80%
optimization 70%
70%
60%
60%
50%
50%
Case Studies 40%
40%
30%
30%
20%
20%
Conclusions 10%
10%
0%
0%
CNG LNG Pipeline
CNG LNG Pipeline

15
 Nikolaou

Research Project 
Openings
CNG Distribution Patterns:  Logistics Matter!

CNG

• Hub‐and‐Spoke • Milk‐Run
CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

16
 Nikolaou

Research Project 
Openings
CNG Distribution

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

17
 Nikolaou

Research Project 
Openings
CNG Fleet Size Bounds

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

18
 Nikolaou

Research Project 
Openings
CNG Distribution in the Caribbean

CNG

Individual bars and cumulative dots CNG requirement Bcm year

P uerto Rico
CNG Vessels Dominican Republic
Jamaica
Trinidad and Tobago
Bahamas
Guadeloupe
Netherlands A ntilles
United States V irgin Islands
CNG Transport: Barbados
Martinique
CAPEX  A ruba
Bermuda
optimization Haiti
C ayman Islands
Saint Lucia
Grenada
Saint Kitts and Nevis
Saint V incent and the Grenadines
A ntigua and Barbuda
Case Studies Dominica
A nguilla
British V irgin Islands
Turks and C aicos Islands
Montserrat
0 2 4 6 8 10 12
Conclusions

19
 Nikolaou

Research Project 
Openings
CNG Distribution in the Caribbean:  The Big 4

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

20
 Nikolaou

Research Project 
Openings
CNG to the Big 4: Fleet Capacity

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

21
 Nikolaou

Research Project 
Openings
CNG to the Big 4:  Travel Time

CNG
Puerto Rico Dominican Republic
Puerto Rico Dominican Republic
Time Time
Time Time
days days
days days
CNG Vessels Of f loading time 15
15
Of f loading time
8 Of f loading time Of f loading time
8 Travel and loading time Travel and loading t ime
Travel and loading time Travel and loading t ime
6 10
6 10
4
CNG Transport: 4 5
5
2
CAPEX  2
of ships, n 0 of ships, n
optimization 3
3
4
4
5
5
6
6
7
7
8 9 10 11 12 13
8 9 10 11 12 13
of ships, n 0 2
2
3
3
4
4
5
5
6
6
7
7
8 9 10 11 12
8 9 10 11 12
of ships, n

Jamaica Bahamas
Jamaica Bahamas
Time Time
Case Studies Time
days
Time
days
days days
8 8
8 Of f loading t ime 8 Of f loading t ime
Of f loading t ime Of f loading t ime
Travel and loading time Travel and loading time
6 Travel and loading time 6 Travel and loading time
6 6
Conclusions 4 4
4 4

2 2
2 2

0 of ships, n 0 of ships, n
0 2 3 4 5 6 7 8 9 10 11 12 of ships, n 0 2 3 4 5 6 7 8 9 10 11 12 of ships, n
2 3 4 5 6 7 8 9 10 11 12 2 3 4 5 6 7 8 9 10 11 12

22
 Nikolaou CNG Distribution in the Caribbean:  
Research Project 
Openings
The Small Ones

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

23
 Nikolaou

Research Project 
Openings
CNG to the Small Ones:  Itinerary 

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

24
 Nikolaou

Research Project 
Openings
CNG to the Small Ones: Fleet Capacity
180

CNG
160 n 4

Gtotal MMcm
140
n 5
CNG Vessels
n 6
120
n 7
n 8
n 9
n 10
100
CNG Transport:
4 6 8 10 12 14
CAPEX  qload MMcm day

optimization

Case Studies

Conclusions

25
 Nikolaou

Research Project 
Openings
CNG to the Small Ones:  Reduced Itinerary

CNG

CNG Vessels

CNG Transport:
CAPEX 
optimization

Case Studies

Conclusions

26
 Nikolaou CNG to the Small Ones:  
Research Project 
Openings
Fleet Capacity for Reduced Itinerary
80

CNG
n 4
70

Gtotal MMcm
n 5
CNG Vessels 60

n 6

n 7
n 8
50 n 9
n 10

CNG Transport:
4 6 8 10 12
CAPEX  qload MMcm day

optimization

Case Studies

Conclusions

27
 Nikolaou

Research Project 
Openings
Conclusions
• CNG ready for prime time
CNG
– Room for further improvement
• CNG complements LNG
CNG Vessels
– Several potential markets worldwide

CNG Transport:
• Logistics and fleet optimization important
CAPEX 
optimization

Case Studies

Conclusions

28