Gasnor AS

– the Small Scale LNG story

Gasnor AS, LNGGasnor has pioneered the market for natural gas in Norway. The company started up supplying natural gas to Norwegian industry through a local pipeline network in the Haugesund area on the western coast of Norway. In this region Gasnor currently delivers natural gas to all kinds of customers, from industry to housing and buses/ cars.

Gasnor was early to recognize that if natural gas was to be used as fuel in ships, and if industry out of reach for pipeline also should be able to convert to a cleaner and more environmentally friendly fuel, it would be necessary to introduce Liquefied Natural Gas (LNG). LNG is a more appropriate form of storage and distribution over greater distances with difficult topography. Gasnor opened its first LNG production plant in April 2003, and has since then built two additional production facilities. The largest production site is at Kollsnes where gas from the Troll field comes onshore.

Until the summer of 2012, Shell was a minor owner in Gasnor. Gasnor is now a wholly owned subsidiary of Shell. The acquisition of Gasnor is regarded as an important step for Shell towards creating a downstream LNG sales business. LNG as a transport fuel will be a reliable new addition to Shell’s innovation led product mix.

The first ship to be powered by LNG in Norway is a coastal car/passenger ferry named “Glutra” who was put into traffic back in 2000. Based on the operational experience with this ferry, the ship owner “Eidesvik Offshore” decided to build a Platform Supply Vessel operating on LNG. By July 2013 there are nearly 40 various types of ships operating on LNG in Norway.

Gasnor currently deliver LNG to a growing fleet of natural gas-powered ships and major parts of Norwegian industry. In the area of LNG fuel, Norway is the world leader, and there is great international interest in the concept that Gasnor has developed. New ships are under construction designed to be powered by LNG and in the coming years we will se more and more ships like tugs, PSV’s, cruise ferries, freight carriers and tankers operating along the Norwegian coastline.

The reasons for the development of Norway as a world leader in LNG fuel for shipping are various, but the initiative and the risk that Gasnor took in establishing LNG production and infrastructure is essential. The bunkering procedures are designed with simplicity and safety in mind and Gasnor has carried out more than 60000 transfers of LNG without incidents. Shell brings additional safety rigor through decades of experience in operational safety.

On January the 24th 2013 the European Commission launched a proposal for a directive regarding “Clean Power for Transport” where LNG plays an important role. The proposal is to establish LNG bunkering terminals in 139 major harbours in Europe and filling stations for LNG trucks with no more than 400 km distance along the TEN-T corridors in the EU. This underlines the role that LNG is expected to play in diversifying and making the transport sector more environmentally friendly.

The directive is expected to come in force by the end of 2013 and will be a strong driver to speed up the use of LNG as a fuel. The goal for Gasnor and Shell is to be a leading supplier of LNG into this market.

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Gasnor AS
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