Brazil's first LNG terminal is inaugurated in Ceará

20/8/2008

The president of the Republic, Luiz Inácio Lula da Silva, inaugurated, this Wednesday (08/20), the first Liquefied Natural Gas (LNG) regasification terminal in Brazil. The project is installed at the Port of Pecém, in the São Gonçalo do Amarante municipality, in Ceará. An unprecedented project anywhere in the world, this terminal kicks-off Petrobras’ performance as a player in the international Liquefied Natural Gas (LNG) market. Petrobras’ second terminal will be inaugurated later this year, in the Guanabara Bay (RJ).

The Pecém terminal is capable of regasifying 7 million cubic meters per day. With LNG, the country will have more flexibility and safety in supplying natural gas to the thermal and non-thermal markets. The LNG will be used, primarily, to fuel thermoelectric plants (TEPs). In his message, the president of the Republic highlighted Petrobras’ achievement capacity: "This terminal was built in record time, in eight months. This means Petrobras is slowly becoming more than an oil company." Lula also mentioned the special moment the country is going through. In the end, he said "this terminal, which is here (in Ceará), is something Petrobras and Brazil must be proud of.”

Petrobras’ president, José Sergio Gabrielli, said the new terminal is equipped with cutting-edge, innovative technology as it brings gas compressed to 600 times its original volume, at a temperature below 160ºC and in the liquid form. When the product arrives, it is once again turned into gas before being injected into the gas pipeline network. He also emphasized Petrobras’ efforts in building a gas pipeline network to connect Northeastern and Southern Brazil via all of the country’s networks. To him, "this terminal is a pioneer, and it is something the Northeast and Ceará can be proud of as it will make a fundamental contribution to the Brazilian power system’s stability in the Northeast."

President José Sergio Gabrielli, directors Maria das Graças Foster and Paulo Roberto Costa, in addition to the president of Transpetro, Sérgio Machado, the president of Petrobras Bicocombustível, Alan Kardec , the president of Petrobras Distribuidora, José Eduardo Dutra represented Petrobras. Federal, state and municipal authorities, in addition to executives and labor union representatives also attended the event.

Unprecedented project

Petrobras’ LNG project is unprecedented in the world. The Company’s regasification terminals are the first ones to use vessels that have been adapted both to store LNG and to regasify the product on board. Brazil also pioneered the adoption of the LNG transference model from a supplier vessel to another regasifier vessel via cryogenic arms that are capable of supporting temperatures of some 160ºC below zero.

Terminal characteristics

The regasification capacity of the terminal installed in the Port of Pecém, 7 million cubic meters of gas/day, equals about half of the natural gas consumption destined to the thermal market nationwide. It also represents an addition of 11% to the current supply (July/08) of natural gas to the domestic market, currently standing at 60 million cubic meters/day. The gas processed in Pecém will be used, prioritarily, to generate power at the Termoceará (CE), Termofortaleza (CE), and Jesus Soares Pereira (RN) plants.

Petrobras adapted the structure of pier 2, at the Port of Pecém, which in the past operated as an oil derivative terminal, in order to prepare it to receive LNG. In the adjustment process, two concrete platforms were built to rise the pier by three meters. The mooring (the so-called mooring dolphins) structure was also reinforced, and facilities assembled to transfer LNG between the pier’s external and internal berths (piping, valve, and instrumentation system), also known as the central skid.

This reinforcement work allows large vessels, such as the LNG supplying vessels, to moor at the pier and the terminal to operate in full safety conditions. The pier measures about 340 meters in length. The mooring platform, which is 45 meters long and 32 meters wide, will be shared by the LNG and liquid fuel infrastructure. Six LNG transference arms and two Compressed Natural Gas (CNG) arms were also installed there. They all measure 28 meters in height. The LNG arms weigh 70 tons each; while the CNG ones 85 tons.

In addition to the interventions made at the pier, a gas pipeline (22.5 km long) was built to connect the terminal to the existing gas transportation network. A section of this gas pipeline (2.5 km) is aerial, installed on the bridge that provides access to the pier, and the remaining part (20 km) is terrestrial. A new control house was also built.

Commenced on December 20 2007, the LNG terminal construction work in Pecém were completed in the record period of eight months. About 36% of the labor, of a total of 450 employees, was recruited in the district of Pecém, in the municipality of São Gonçalo do Amarante.

How the terminals operate

As the name suggests, Liquefied Natural Gas (LNG) is Natural Gas (NG) in its liquid state. The liquefaction (transformation from the gaseous to the liquid state) takes place after the NG is cooled to a temperature of 162ºC below zero. In the liquid state, the volume of the natural gas is reduced by about 600 times, facilitating transportation. In the gaseous state, NG is transported via gas pipelines at a pressure of up to 100 kilos per square centimeter.

In the liquid state, the gas can be transported in cryogenic vessels. When it arrives at its destination, LNG is submitted to a physical regasification process to return to its gaseous state. This process occurs by means of a temperature increase carried out at the regasification units.

In Petrobras’ LNG project, each regasification terminal is capable of receiving two vessels: one LNG supplier and a regasifier vessel. Each time a shipment is purchased, an LNG supplier vessel comes to Brazil to bring the gas to be regasified in Petrobras’ regasifier vessels.

LNG is transferred between the vessels by means of the state-of-the-art cryogenic arms that ensure safe, efficient operation. At the terminals, by means of piping and valve systems, the LNG is transferred among the arms, goes through the piping and then, through other arms, it is injected into the regasifier vessel tanks.

After the regasification carried out at the regasification plant located in the vessel itself, the gas is injected into the transportation network. In this operation, the transference of the gas, now in the original gaseous state and under a pressure of 100 kilos per square centimeter, takes place via the Compressed Natural Gas (CNG) arms. The LNG terminal will be operated by Transpetro. The company trained a group of 12 operators in a few of the world’s main LNG terminals.

Vessel stores and regasifies LNG on board

The vessel chartered by Petrobras for the Pecém terminal is capable of regasifying 7 million cubic meters/day and of storing 129,000 cubic meters of LNG, equivalent to 77 million cubic meters of natural gas. With five storage tanks, the vessel is huge: 289 meters in length, 44.6 meters wide, and 11.9 meters of draft.

The vessel, called Golar Spirit, was converted at the Keppel shipyard, in Singapore. The work, kicked-off in October 2007, was completed in a record period of eight months. In this period, the regasification plant and the cryogenic equipment were built and assembled. On route from Singapore to Brazil, the vessel received its first load of LNG in Trinidad & Tobago.

The vessel, which left Singapore on June 11, arrived in Pecém on July 22. Before beginning commercial operation, Petrobras is carrying out detailed technical inspections on the vessel. When it arrived off the Brazilian coast, the ship was submitted to a routine Navy inspection.

For supply, Petrobras has LNG supply agreements with the main vendors in the world, among which Shell and the BG Group. Agreement bases are appropriate for the project’s flexibility and for the domestic market’s demand.

In addition to these agreements, which are binding and ensure LNG delivery when demand is signaled, Petrobras signed 11 Master Sales Agreements (MSA), which are LNG purchase and sale intention agreements and establish the main conditions for supply.

International security Standards

Petrobras’ LNG project complies with the strictest international security standards. The technical standards and guidance provided by the Ocimf (Oil Companies International Marine Forum) and by the Sigtto (Society International Gas Tanker and Terminals Operators) were followed. Petrobras is a member of these entities, which are international industry references.

Among other additional security measures the Company has adopted is an intelligent system that integrates the entire terminal. It is capable of completely interrupting both LNG transference between the vessels and natural gas flow from the regasifier vessel to the gas pipeline at any sign of abnormality.

All of the LNG and CNG connections are equipped with special valves that allow flow to be interrupted quickly, if necessary. The transference arms are also equipped with an emergency disengagement system, which foresees two performance situations. In one, the cargo pumps are switched off and the arm valves closed; in the other, the arms are disconnected from the vessels.

Petrobras press release