Black & Veatch and Chemtex to Develop Eighth LNG Facility in China

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Researched by Industrial Info Resources (Sugar Land, Texas)--China's integrated natural gas producer China Natural Gas, Incorporated (NASDAQ:CHNG) (CNGC) (Xian, China) has selected infrastructure company Black & Veatch Corporation (Overland Park, Kansas) and global engineering, procurement and construction (EPC) company Chemtex International (Wilmington, North Carolina) to design and build a 700-ton-per-day liquefied-natural gas (LNG) facility at Guangyuan, in the Sichuan province.

On completion of the facility, Guangyuan's population of 3 million will be supplied with a cleaner, more cost-effective fuel that can be used in industries, in homes, and for transportation. The development of the facility will create about 100 employment opportunities. "Bringing this infrastructure up to date will help stabilize an area that was damaged by the earthquake in 2008," said Qian Guozhu, the general manager of China Natural Gas Guangyuan Company Limited.

"Adding this infrastructure benefits the region on many levels," said Brian Price, the vice president of LNG technology at Black & Veatch. "China is demonstrating the economic viability of using LNG as a clean, portable and reliable fuel source. It provides significant environmental benefits, while being less expensive than diesel or other hydrocarbon fuels."

CNGC is also setting up 10 mobile and 20 stationary LNG gas stations for public transportation and buses. The LNG gas stations will create jobs in the area.

In addition to supplying LNG to Guangyuan, the facility will supply natural gas to the country's West-to-East gas pipeline during times of high usage and demand, which peaks during winter. LNG also will be shipped in trucks to local distribution points in areas with little or no natural gas infrastructure, regasified and supplied to industrial and residential consumers. About 35 trucks are expected to be loaded at the facility each day. LNG will effectively reduce the demand for coal and diesel.

Besides being a safe, clean and efficient energy source, LNG is expected to play a major role in the development of the industrial value chain in China. With the development of new LNG facilities, related needs such as containers for transportation, liquefying equipment, storage equipment, and other industrial accessories are expected to grow.

With this project, Black & Veatch and Chemtex will have developed eight LNG facilities in China since 2005, and this will be the third in the Sichuan province. The total installed cost of all the projects has been estimated at more than $400 million. With this facility, Black & Veatch will have a clean-fuel production capacity of more than 5,000 tons per day.

All eight LNG projects are based on the patented PRICO LNG process of Black & Veatch. The process uses a single mixed-refrigerant loop for the liquefaction process, and its key advantages include flexibility in handling various feed gases, minimal equipment, simplified control, and the lowest capital costs among all the competing technologies. Of the eight projects, the facilities at Erdos in Inner Mongolia and Zhuhai City in the Guangdong province have begun operations, while the one at Dazhou in Sichuan is ready to begin. The other sites are in the northwestern Gansu province, the Shaanxi province, and the northwestern Xinjiang autonomous region. The facility at Guangyuan will replicate the Erdos and Dazhou facilities.

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