The history of LNG is very diverse with many different factors contributing to what we know and use today.

LNG stands for liquefied natural gas. This natural gas is drilled for and extracted from the earth in a gaseous state. LNG is a natural forming composite of methane, water, carbon dioxide, nitrogen, oxygen, sulfur and other hydrocarbons. In this respect it is very similar to petroleum, but it is a much cleaner burning fossil fuel therefore making it a more in demand fuel to our Eco friendly economy. The only problem with natural gas is that it occupies such a large space thus making it difficult to transport aboard conventional vessels, but a solution to solve this was invented. In 1914 Geoffrey Cabot discovered a way to liquefy natural gas and transport it using a barge. To do this Cabot refrigerated the gas to a negative two hundred sixty degrees below zero, and kept the gas at this constant temperature. In this cold state, the natural gas liquefied and reduced its volume by about 600 to 1. LNG is non toxic, odorless, colorless, non corrosive and when vaporized it burns only in certain percentages with air. These variables contribute to make a very superior energy supply that they world will depend on highly in the future. With this liquefying technique it became very lucrative to start producing natural gas around the world. A few countries that have very large LNG reserves are Algeria, Australia, Brunei, Indonesia, Libya, Malaysia, Nigeria, Oman, Qatar, and Trinidad and Tobago. As one can see these countries are very different than they typical oil producing nations that the world formerly relied on for fuel production. This really decreases our dependency on unstable Middle Eastern countries. Let us now shift from the development of LNG to the actual production and practical uses of LNG. As previously stated LNG, like oil, is accessed by drilling for it. But before someone can drill for it, exploration teams are needed to determine if a particular area will be productive or not. The invention of "multidimensional seismic imaging" allows a team to narrow down natural gas pocket

areas, and then study the effects of time on the reserve. Once a profitable pocket is found and studied, a drilling rig will be brought in and will drill a hole to the necessary depth to obtain the natural gas. This allows modern drilling rigs to be used for another purpose other than finding petroleum reserves. In some cases, natural gas is as abundant as the oil and both are extracted at the same time. Although an abundance of natural gas exists onshore, a large part of it is being produced offshore. To help this shift, new technology is allowing wells to be drilled in ever increasing water depths up to 10,000 feet. These deep water wells are producing large quantities of natural gas, and most of the natural gas production is now shifting to ultra deep water reserves. Another large step in technology is the ability to join the onshore LNG and offshore LNG production equipment. This allows production costs to be drastically decreased due to the standardization of machinery and equipment necessary. As far as commercial uses for natural gas, there are concerned there are quite ranging from office buildings, schools, churches, hotels, restaurants, churches, and many other organizations . Currently 13 percent of commercial buildings use natural gas for cooling purposes, but this number will soon skyrocket due to the new technology that is allowing unit costs to decrease and efficiency to increase. A large commercial growth area to watch is the restaurant industry. The forecast for this industries use of natural gas is expected to increase dramatically due to the growing popularity of cooking using natural gas, and the very low cost of it. LNG is produced in Alaska, Algeria, Australia, Egypt, Indonesia, Malaysia, Nigeria, Oman, Qatar, Trinidad and elsewhere. Typically, LNG production areas are rich in natural gas reserves, but have little or no access to local markets are pipelines. New liquefaction plants are being developed today in Angola, Equatorial Guinea, Nigeria, Norway, Peru, Russia and Venezuela, among others. Once in its liquid state, LNG is much more movable. There are three main ways LNG can be transported, by vehicles, tankers, and pipelines, both intrastate and interstate. First, the trucks; the cheapest and easiest

method for loading, delivering, and discharging LNG. LNG is transported in large trucks and is stored at atmospheric pressure inside a tank that acts as a thermos bottle. Because LNG is not kept under pressure, it slowly evaporates in a process called boil off. The reason it keeps liquid is because as it evaporates, it draws heat from itself, keeping LNG at the necessary -260 degrees. Second, the large tankers. About 160 tankers specifically designed for LNG are in use today, with many more being built. LNG ships have one inch thick hulls that are 20 feet apart and heavily reinforced. Within the inner hull, there can be up to 5 isolated LNG tanks. Storing LNG inside the hull limits the volume of a potential accidental release an accidental releases potential volume. These double-hulled tankers can carry up to 137,000 cubic meters of LNG. LNG tankers are usually much more environmentally safe since the ships use natural gas instead of oil as their source of propulsion. The pipeline is the most complex of the three, since it is the only one with various designs. The three are: the gathering system, the interstate pipeline, and the distribution system. The gathering system can range from basic to complex. The basic part of it is that it is a low pressure system with small diameter pipes that move the raw gas from where it is pulled, the well head, to its semi-final destination, the processing plant. The complex part of it is the possibility that it may contain high levels of sulfur or carbon dioxide. When this happens, it is called sour gas. Because sour gas is very corrosive and even more dangerous, a special high priced gas gathering pipe but be added into the pipe line. Also, instead of going straight to the processing phase, it must first be sweetened, meaning it is to be cleansed of all other substances other than the raw natural gas. The interstate (state to state or even clear across the country) or intrastate (within a particular state) system is much more complex seeing that the LNG travels at a pressure ranging from 200 to 1500 PSI with compressor stations every 40 to 100 miles to ensure that the LNG is at a high enough PSI. The gathering system consists of low pressure, low diameter pipelines that transport raw natural

gas from the wellhead to the processing plant. Should natural gas from a particular well have high sulfur and carbon dioxide contents (sour gas), a specialized sour gas gathering pipe must be installed. Sour gas is extremely corrosive and dangerous, thus its transportation from the wellhead to the sweetening plant must be done carefully. One of the amazing things about the LNG transportation industry is its safety record. In over 40 years and 38,000 carries traveling over 60 million miles, there has never been a loss of life or cargo. In the U.S., there are some 113 LNG facilities, most of them peak-shaving. Of the approximate 113 active LNG facilities in the United States, 57 are peak-shaving facilities LNG peak-shaving facilities are used to store LNG to meet peak consumption during the winter. Each peak-shaving facility has a regasification unit and some have a liquefaction unit. Peak shaving facilities are used to store LNG to meet peek demand during the periods of most consumption- i.e. the winter. Each peak shaving facility has a regasification facility to allow the natural gas to go from liquid to gas when necessary as it is pumped directly in from the pipelines. Some facilities have a liquefaction unit which provides the most diverse storage options allowing the facility to take the natural gas from liquid, to gas, and then back again as much as necessary without losing an extremely large amount of natural gas. People have two main concerns when it comes to the hazards that LNG facilities and transportation pose. Environmental impacts: like air and water pollution. As well as residential impacts light sound and light pollution from the facilities operations. Secondly, and perhaps more important to most people is the potential safety hazard to them and their loved ones in a world where the threat of international terrorism looms ever present. To start off the analysis of potential hazards: An examination of the general environmental impacts of LNG. The plants that liquefy natural gas for transportation impact both air quality, with stack emissions, and water quality via cooling water being discharged back into the environment. The effects on the environment and surrounding communities of

pumping smog producing agents into the air are obvious decreases in air quality. These pollutants and their exact impact on the environment are determined by the type of energy production used in the plant. Most Natural gas liquefaction plants use readily available natural gas running combustion turbines in their process. This can result in rather significant amount of Nitrogen oxide being put into the air. The second main environmental effect is very similar to that of power plants. Using massive amounts of water as heat exchangers leads to the potential for either contamination of the surrounding waters by chemicals used in the process if filtration methods fail, or more likely thermal pollution from the closed system cooling. This thermal pollution comes either in the form of an increased ambient air temperature around the cooling towers, or the release/transfer of warmer waters into the surrounding bay or estuaries. The other primary environmental impacts of any such facility are residential in nature. Maximum sound level production must be taken into consideration, along with the potential for light pollution. In accordance with all these factors an Environmental Impact Assessment or E.I.A. must be submitted to the proper governmental organization outlying all of the potential impacts of any expansion or new construction. However these hazards are overshadowed not only in the minds of the public, but also by industry leaders. They are most worried by the perceived potential for catastrophic disaster, accidental or terrorist in nature, involving LNG facilities and transportation systems. The danger in the public eyes stems mostly from people common interaction with natural gas and it usages for heating and cooking. However, as natural gas is pumped through service lines it is much more volatile than its compressed form. LNG is kept at temperatures as low as negative 260 degrees Fahrenheit. At that temperature its volatility is reduced greatly and it takes up only 1/600 of the storage space. While in transit this low temperature is maintained via insulation methods rather than refrigeration and thus much less

susceptible to machinery failures. Double hulled tankers with vast arrays of monitoring gear further ensure the safe transport of LNG under normal circumstances. In fact LNG has been transported over the oceans for over 40 years. In this time forty thousand safe voyages covering over sixty million miles have been conducted with no major incidents reported. However even this impressive safety record has little impact on the potential for disaster as pertaining to terrorist action. Since September 11, 2001 things have been changing in regards to LNG safety in the United States. To prove the point on safety, Distrigas Facility in Everett, Massachusetts will be the example. Its location near a major metropolitan area adds an interesting degree of interchangeability when thinking of the purposed facility for Pelican Island here in Galveston. All information was gained from a detailed report on its security measures made available via a state freedom of information request. During any vessels inbound approach to the harbor facility its major providers of security will be the United States Coast Guard (USCG). The Coast Guard is tasked with informing all other relevant security groups and agencies whenever it is notified of an incoming delivery and is expected to coordinate the sequence of security activities. In the case of the Distrigas facility police are observe the intended docking site covertly for 24-26 hours prior to the vessel arrival. Meanwhile, members of the police dive team are to inspect the docks site for any explosives or other devices prior the ships arrival in the channel. All of this is followed by a unified command being set up. This command consists of high ranking members of the USCG, the city police, and fire departments. These are merely the measures to be provided shore side to the incoming tanker. When the ship comes within two miles of the harbor it is to be enshrouded in not one, but two layers of security craft. The Inner layer consisting on Coast Guard boats, half equipped to ram intruders into the safety zone. The second half of the inner ring of security has been outfitted with the necessary heavy weaponry to destroy the offenders should they persist. The outer ring consists of four police patrol craft to alert the inner ring of any approaching craft. All of which will stay with the ship till it ties up at the dock. Further police units will block off all

entrance ways to the docking site when the tanker is brought along. While in port, the majority of the security measures fall to the facilities own in-house guards, with a visible presence maintained by the locale police department turning the offloading procedures. While the tanker is empty and outbound only one layer of coast guard protection has been mandated. All this serves to illustrate the level to which the government has in this post 9/11 world gone to secure such a potential hazard from terrorists. For many in the industry, and to the government these measures seem to be more than enough to ensure the safe conduct of the LNG industry within the waters of the United States. People will still worry about their safety, as people worry about airline safety. However, it would seem from examples like this that the LNG industry is a great deal more secure than some people suspect. As natural gas prices soar amid tightening supplies from the United States and Canada, a growing industry is centered on an old idea; import liquid natural gas from overseas, just as we do oil. In the next few years, tankers of liquefied natural gas, or LNG, will increasingly make their way from gas-rich nations such as Qatar and Nigeria to the coastlines of the United States. At least eight terminals are planned for Texas, including two in the Houston area. One facility, slated for Quintana, near Freeport, is nearing the start of construction, while plans for a terminal on Pelican Island in Galveston are in the early planning stages. The Pelican Island facility is under much scrutiny because of its busy location just west of the Houston Ship Channel. According to the Gas Technology Institute (GTI), there are 113 active LNG liquefaction facilities in the United States. Would-be developers have identified about 50 North American sites, onshore and offshore, as potential spots for LNG terminals. Though not all of them will be built, some certainly will in the next 10 years. Still, not since the energy crises of the 1970 have LNG imports looked so promising. Higher natural gas prices, the discovery of new natural gas sources overseas, and lower costs for producing and shipping LNG have contributed to a renewed interest in it, according to

the Energy Information Agency's (EIA) Annual Energy Outlook 2002. Overall U.S. natural gas demand is expected to grow by almost 50 percent between 2000 and 2020 according to EIA, natural gas consumption will grow from 22.83 trillion cubic feet (TCF) in 2000 to 33.78 TCF in 2020. While the demand for natural gas will increase in all areas, most of it will come from electricity generation. Nothing produced here, nor in Canada is likely meet the future demand, industry analysts say. Gas-hungry electricity generators are expected to triple their demands by 2020, growing faster than any other area. Where will all of this natural gas come from, then? Gas-rich countries such as Trinidad, Algeria, Nigeria, and Australia may be part of the answer. At present, the only possible option for importing natural gas from overseas is by liquefying and shipping it via large, specialized LNG tankers. The United States already imports a small amount of LNG which will significantly shift the energy landscape as it provides new supplies of natural gas and gives the industry new ways to make money. But it will also boost the country dependence on overseas sources of energy, raising the possibility of a gas cartel such as the Organization of the Petroleum Exporting Countries. Every year, LNG companies around the world release innovative plans for new technology in order to improve the productivity and shipping of LNG. Exxon Mobil Upstream Research Company recently announced that it has licensed a patented liquefied natural gas (LNG) storage tank. This new innovation in LNG storage technology, called modular tanks, offers the potential for significant cost savings and faster construction times for LNG import and export terminals. The tanks have been designed and rigorously evaluated for a wide range of conditions including earthquake prone areas of the Pacific-rim, North America, and Europe. The modular LNG storage tank system is another example of Exxon Mobil extensive LNG technology development program contributing to the company's expanding LNG business. There are a number of patents describing various aspects of LNG manufacturing which are

awaiting approval since the booming LNG period between 1995 and 1996. These patents include a secure communications link for sales authorization through an automated point-of-sales system, safer storage tanks, dispensing equipment and safety devices for leak detection, and inventory control and reconciliation. At this time, technology employing LNG as fuel is primarily found in industrial and fleet applications. It is interesting to note that two patents for portable LNG dispensing facilities already have future retail applications. The future of LNG lies in the hands of the engineers who must increase the productivity and safety of the growing business. Local opposition to import terminals, which cost hundreds of millions to build, is among the potential obstacles to the industry's plans. Foreign supplies must also be available, and that means constructing expensive plants to liquefy the gas in sometimes unstable areas of the world. The industry is convinced it can overcome potential problems. Liquid natural gas has pioneered technological innovations and achieved the highest standards of operational excellence. Developments have brought new types of systems such as offshore LNG terminals that provide sites and specific solutions, through a combination of sound design and construction. Through safety and security conscious procedures, the industry has established a track record unparalleled by any comparable industrial operation. LNG is a reliable and economical way to meet growing U.S. demand for natural gas.