For stranded natural gas, CNG may offer an alternative to LNG's high front-end costs.

Marine transport of compressed natural gas (CNG) is an emerging industry that is critical to the monetization of gas supplies and in meeting the needs of emerging gas economies worldwide. CNG marine transport requires a focal point and breeding ground for testing and development by technology proponents and potential users of CNG systems. Regulations and standards are also being created to support this new industry through the provision of appropriate safety standards for these technologies.
The East Coast of Canada (Newfoundland & Labrador and Nova Scotia provinces) represents a particularly attractive supply of natural gas resources located within a viable distance to robust markets in the northeastern United States for CNG transport. Reserves in the Atlantic Canada region are in the form of both associated and non-associated gas. Industry and government alike have been actively seeking the means to develop these gas reserves, however, traditional solutions (e.g. pipeline) have technical and cost issues surrounding them and have not proven to be economic in this environment.

The province of Newfoundland & Labrador has a strategic need for a timely gas monetization solution and has been developing a natural gas strategy for the past three years. Following a recent series of in-depth studies, CNG transport has now been identified as the most applicable technology with which to unlock the value of the Jeanne d'Arc Basin gas reserves. CNG transport can satisfy the province's business drivers while offering exploration and production developers and resource holders an attractive and more timely means to get their gas to market.

Atlantic Canada also has advanced capabilities and resources through the technology centers established in Atlantic Canada, such as Memorial University, the Centre for Cold Ocean Research and the Institute of Marine Dynamics.

The CNG International Marine Institute (CIMI) was formed to meet the needs of this emerging and global CNG transport industry. "We applaud the vision of the CNG proponents that partnered in the creation of this Institute on the Memorial University campus in St. John's. We are also very grateful that the Atlantic Innovation Fund supports this research and development activity in Atlantic Canada," said Memorial President Dr. Axel Meisen. Meisen will present CIMI's mission and development plans as part of a panel discussion at the Offshore Technology Conference Industry Breakfast "CNG - An Emerging Industry" on May 4, 2004, in Houston, Texas.

CIMI is a federally incorporated "not for profit" entity established to provide a world class research and development facility dedicated to the advancement of efficient, safe and competitive CNG marine transportation, storage, handling and utilization. The Institute, located on the campus of Memorial University in St. Johns, Newfoundland, will establish a large scale, dynamic testing facility for research and development efforts dedicated to CNG marine transport and will be complemented by appropriate support resources.

The Institute will engage industry and other research entities in conducting collaborative research and development programs to meet industry-wide needs and provide contract research and development services to clients worldwide. The project will focus on two research and development areas: (a) CNG Process Engineering and Testing, and (b) Maritime Systems Verification. Initial industry-wide research and development projects identified include:

• Compact pre-treating process equipment
• CNG operations simulation
• Ship design concepts
• CNG simulation training
• Offshore loading/unloading
• Terminal design & operations
• Storage options
• Concept design evaluations
• Safety assurance investigations
• Storage options analysis
• Transport service cost evaluations
• CNG hazard analysis
• Risk model development
• Best practices interactive tools

CIMI will leverage benefits from the collaborative participation of Marine CNG technology developers, internationally-recognized petroleum research and development (R&D) facilities/institutes (Memorial University of Newfoundland and The Gas Technology Institute), petroleum producers, shipping companies, classification societies, natural gas infrastructure providers, offshore technology providers and government agencies.

It is the intention of the Institute to be self-sufficient within 5 years through the development of innovations and products that will be required by the CNG marine transport industry.

One of CIMI's first objectives is to foster a "living" forum through which the emerging Marine CNG industry will be able to advise and inform administrations, regulators and industry on CNG issues. It will seek to build a consensus among international regulatory bodies and administrations that existing rules and guidelines for CNG marine transport require an equivalent level of safety as any other gas ship. To that end, CIMI's leadership team is organizing the world's first International Standards Forum dedicated to the CNG marine transport industry.

This forum, set for June 22 through 24 in St. Johns, Newfoundland, will consist of a series of working sessions to organize perspectives and ideas on the appropriate forms of guidance and regulatory oversight for the CNG marine transport industry.

This International Standards Forum will be for CIMI members and invited guests only. Please contact Donna Osborne, dosborne@mun.ca for more information.

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