New gas transportation method eyed: Report

With the aim of lowering the cost of transporting natural gas from small and midsize gas fields in Southeast Asia, the government has set a policy to start commercially transporting natural gas in solid form by 2008, government sources said Wednesday.

As transporting natural gas in solid form is much cheaper than moving liquefied natural gas, the government expects to employ the method at numerous small gas fields located in Southeast Asia, many of which are currently unexploited. The Yomiuri Shimbun reported.

The plan will significantly help Japan compete for energy resources with China, India and other emerging economies, which are desperately seeking to secure natural gas supplies.

The government will propose the creation of an international safety standard for transporting the solidified natural gas--or natural gas hydrate (NGH)--at a safety meeting of the International Maritime Organization, being held in Turkey until Friday.

NGH is an icelike material produced artificially by combining natural gas and water under high pressure. Methane hydrate--nicknamed "burning ice"--has recently been attracting much attention and is a kind of NGH.

NGH stabilizes as a solid at around minus 20 C and can be transported more easily in this form.

Liquefied natural gas needs large-scale plants to cope with the ultralow temperatures involved in liquefying natural gas, which is possible at minus 162 C.

Conversely, NGH production only requires a small-scale plant, and thus the initial capital investment can be half that needed for an LNG plant.

As the temperature required to store NGH is closer to normal temperature, NGH is more stable and can be transported by less expensive cargo ships than those required to move LNG.

Japan is the world's front-runner in NGH research. If the NGH technology is established for commercial use, Japan will be able to exploit smaller gas fields--which for financial reasons have not yet been developed--much earlier than other countries.

According to the government's estimate, LNG is more cost-efficient than NGH when transported in large quantities over a long distance--such as from the Middle East or places further afield.

NGH is most cost-efficient when transported over distances up to 6,000 kilometers.

Thus, the government expects the technology open the possibility of developing small and midsize natural gas fields in Indonesia, Brunei and other Southeast Asian countries.

Currently, several Japanese companies, including Mitsubishi Heavy Industries Ltd. and Mitsui Engineering & Shipbuilding Co., are producing NGH.

Mitsui Engineering & Shipbuilding and the National Maritime Research Institute, an independent administrative organization, are studying the commercial production of tankers to be used exclusively for transporting NGH. (*)