Liquefied natural gas

Figure 1. An LNG carrier. Note the size of the LNG ship compared to the pier on the left.[1]

Liquefied natural gas or LNG is a colourless and odourless liquid that contains 85-95% methane with trace amounts of ethane, propane, butane and nitrogen.[2] The worldwide liquefied natural gas industry is growing rapidly. Global LNG trade enables development and is able to supplement domestic production to regions that lack natural gas reserves or infrastructures. LNG has been used and traded worldwide for more than 50 years, but many organizations are expecting this trade to increase dramatically in the coming years.

Liquefied natural gas is made by cooling natural gas to -162°C (-259°F) at 1 atm.[3] As often happens with phase changes, this process of going from gas to liquid makes the volume taken up by the fluid decrease considerably, up to 600 times smaller. This reduced volume makes it easier to store and transport natural gas to markets that lack natural gas reserves.[3]

The concept of converting natural gas into LNG was developed in Germany in 1893, but the first commercial LNG plant was not built until 1941 in Cleveland, Ohio.[4] Advancements in LNG technologies and practices for liquefaction and degasification processes have transformed the LNG market into a more efficient, global business. As of 2018, there were 21 exporting countries and 33 importing countries that have proposed LNG plants and/or units in operation.[5]

Use of Liquefied Natural Gas

Natural gas has been used for various applications (e.g. home heating) for many years. The availability of LNG as a way of moving natural gas around makes other uses more feasible (e.g. natural gas vehicles).

  • Trucks: LNG can be used as a transportation fuel because of its energy density. This has the potential to be cheaper than conventional diesel, have quieter engine operation, and emit less greenhouse gas emissions (30-40% reduction).[6]
  • Shipping: LNG is a potential solution for the shipping industry as an alternative fuel source to diesel powered vessels. LNG is not only cleaner-burning but also cost-saving as the vessel can hold a greater volume of LNG than diesel fuel. Retrofitting a vessel for LNG use costs between $10 to $50 million.[7]

LNG Value Chain

The LNG value chain consists of the following stages (Figure 2):

  1. Exploration and Production (E&P) - Upstream industry that focuses on the search for hydrocarbons in favorable geological conditions for extraction. Once a promising location has been identified a natural gas reserve is developed. Natural gas is extracted by drilling holes into the reservoir. The extracted gas is then processed, which includes the removal of impurities and separation of hydrocarbons for end market use.
  2. Liquefaction - Processed natural gas is transported to LNG liquefaction plant site by pipeline and is converted into its liquid state.
  3. LNG Storage - To maintain LNG at its low-temperature state, double walled LNG tanks with good insulation are used.
  4. Transporting LNG - Transportation of liquefied natural gas involves shipping LNG over long distances in a special purpose LNG carrier, which includes good insulation and a double hull design to provide more strength and safety.
  5. Re-gasification - Upon arrival, LNG is converted from the liquefied phase to the gaseous phase, where it is transported through natural gas pipeline systems for distribution to businesses and homes.
Figure 2. LNG Supply Chain Model - Source: PPT, LNG.[8]

For Further Reading


  1. Wikimedia Commons. (June 8, 2015). LNG carrier Alto Acrux [Online]. Available:
  2. U.S. Department of Energy. (August 31, 2015). Liquefied Natural Gas: Understanding the Basic Facts [Online], Available:
  3. 3.0 3.1 IHRDC. (August 31, 2015). LNG Value Chain [Online], Available:
  4. Global CSS Institute. 9.1 Development History of LNG [Online]. Accessed Nov.21, 2018. Available:
  5. Evaluate Energy, Global LNG Market Review [Online]. Accessed Nov. 21, 2018. Available:
  6. CLNG. (August 31, 2015). LNG and Its Many Uses [Online], Available:
  7. S. Kolenko. (August 31, 2015). BC Ferries weights costs of LNG ship fuel option [Online], Available:
  8. PPT, LNG. (Accessed Sept 3, 2015). "LNG Value Chain [Online], Available:

Authors and Editors

Will Cook-Clarke, Jordan Hanania, Ellen Lloyd, Rudi Meyer, Ashley Sheardown, Kailyn Stenhouse, Kandi Wong, Jason Donev
Last updated: February 24, 2019
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