Floating storage unit could supply natural gas to Hong Kong

Regarding the future fuel mix in Hong Kong, I would suggest the SAR does not import all its gas from the mainland but tries to diversify supply sources.

Although a proposed land-based liquefied natural gas terminal was shelved in 2008, Hong Kong should explore the possibility of LNG imports which are based on a floating storage and regasification unit. This is a more cost-effective way to enhance supply security.

Such a unit is a de facto ship-based LNG import terminal that integrates storage and regasification of LNG on board. It can be moored to a jetty or an offshore platform, where the water is over 14 metres deep. It receives LNG from an LNG carrier, then stores and regasifies it for onshore use.

Many units in use today were converted from used LNG carriers, so most of the facilities, like pipes, pumps and storage tanks, can be redeployed in them. The conversion is mainly to retrofit regasification facilities onto a carrier, reducing the capital cost to less than 50 per cent of a land-based one. The work takes around 24 months, compared to 48 months for a land-based facility.

For these reasons, such a unit is considered a cost-effective solution to meet urgent gas demand and strengthen energy security by gas source diversification.

Another economic advantage is less upfront investment. The gas buyer does not necessarily own the unit, but charters it for a period of time. When the charter expires, the buyer can renew it or the unit sails off to another destination.