Just like there’s room for Amazon and Etsy in the e-commerce world — one for mass marketers and the other for artisans — there’s room in the energy industry for both large- and small-scale LNG companies and plants. By focusing on the development of niche markets and scaling their production and distribution operations accordingly, a number of smaller (but growing) players in the LNG space have been making natural gas available to a surprising variety of customers: from industrial, oil-and-gas and mining companies to rocket launchers, Caribbean resorts and island utilities. ESG is a big driver — the LNG supplied often replaces diesel, fuel oil and propane, which can have bigger carbon impacts. In today’s RBN blog, we continue our series on small-scale LNG with a look at a cross-section of key players in this space and how they’ve been growing their businesses.
As we said in Part 1, the U.S. LNG market has been expanding by leaps and bounds over the past half-dozen years or so, most evidently via the build-out and operation of large liquefaction/LNG export facilities along the Gulf and East coasts. But there’s more to the U.S.’s LNG story than the megaprojects built by Cheniere, Venture Global and their ilk. There also are dozens of much smaller liquefaction plants, including (1) peak-shaving plants that squirrel the LNG away for periods of high gas demand by local distribution companies (LDCs) or power generators and (2) commercial plants that typically supply a variety of customers, which typically hold long-term contracts under which the plant delivers LNG to the customer by truck, ship or a combination of the two.
In today’s blog, we’ll focus on a representative sampling of commercial small-scale LNG companies, many of which have grown their businesses by helping their prospective customers in the U.S., Mexico and the Caribbean map out ways to shift to natural gas.
A good place to start would be Stabilis Solutions, a pioneer in this space, which was founded in 2013 and serves an unusually wide range of customers. Publicly owned Stabilis owns and operates two liquefaction plants: a facility in George West, TX (within the Eagle Ford Shale) that can produce more than 100,000 gallons/day (100 Mgal/d; equivalent to about 8.2 MMcf/d of natural gas) and a plant in Port Allen, LA (across the Mississippi River from Baton Rouge), that can produce up to 30 Mgal/d (about 2.5 MMcf/d) — Stabilis acquired the Louisiana plant in June 2021. The company also purchases LNG from third-party production sources, which enables Stabilis to support customers in markets where it doesn’t own liquefaction plants.
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