Sakhalin-2: one of the world’s largest integrated oil and gas projects
Sakhalin-2 is one of the most challenging engineering feats ever achieved. It operates in some of the world’s harshest conditions in Russia’s far east, an area prone to earthquakes. In the North of the Island the winter season lasts up to 240 days and there is ice for most of the year. Facilities are designed to withstand the impact of a major earthquake.
Ian Craig, former Chief Executive Sakhalin Energy
Ian Craig, Chief Executive Sakhalin Energy
Hello I’m Ian Craig, Chief Executive of Sakhalin Energy.
We’re here in the south of Sakhalin in Aniva Bay with the heart of our project behind us;
the LNG Plant and the Oil Export Terminal,
and this is what most visitors see when they come to the island.
But the story starts much further north,
800 kilometres north of here where we have the oil and gas reservoirs.
These reservoirs are not particularly unusual apart from their size;
they have about 4 billion barrels of oil equivalent.
But they are in the north-east of the island and there we have sea ice,
moving sea ice for about 6 months of the year which poses a real challenge for development.
We have 3 oil and gas platforms in that vicinity
each of them have to resist the loads from the moving ice
and from seismic events that also happen in the same area,
and they form the base for drilling the wells which include the largest gas wells in Russia.
But that sea ice movement prevents us from having normal oil and gas export activities using tankers,
it’s just not possible, so we elected to have the export point here in the south of the island.
So the oil and gas goes from the platforms through sub-sea flow lines below the depth of ice
scour onshore where it goes through a processing facility.
The condensate is stripped out from the gas and the condensate is mixed with the oil;
the oil goes down a 24-inch oil pipeline; the gas goes down a 48-inch gas line.
To give you an idea of the scale of the pipeline system if we were in the UK,
this is the equivalent of having the platforms just offshore of Aberdeen,
the onshore pipeline starting Dundee and the LNG facility in London.
The oil and the gas comes down here to the south of the island to the terminal behind me.
The oil goes into storage tanks,
two-large 100-cubic metres each storage tanks and then it goes to the tanker loading point
out in the Bay over my shoulder here.
There we load the oil tankers and they set sail for the various markets in the world.
At peak production we will be producing about 150,000 barrels of oil a day
and that will give us roughly 100 oil tanker movements per year.
The gas has to be treated before we can refrigerate it.
We remove any last traces of water; we remove also any CO² and any H2S
because this could damage the system downstream.
We then refrigerate the gas in two steps,
first of all down to minus 50 degrees then down to minus 160 degrees.
This requires a lot of power the second refrigeration alone requires about 80 megawatts.
And here we get an advantage because the colder the climate
the less power you need to generate the same volume of LNG.
And we can actually make more LNG in the winter than we can in the summer
and that matches the market demand, fortuitously.
So the LNG is chilled down to minus 160 degrees and it shrinks in volume to 1/600th of its size,
its volume at room temperature.
It’s also stored in two storage tanks 100 cubic metres each
and then it can be shipped into carriers like the one behind me here.
This is about 145,000 cubic metres of LNG, or 65,000 tonnes.
Our capacity is about 9.6 million tonnes per annum,
that’s the equivalent of about 150 ships like this every year.
Most of these ships will be supplied by our customers;
they all bring their vessels here and pick up their cargo.
This one is actually on charter to us for 20 years.
It’s the first ever Russian LNG carrier operated by Sovcomflot on our behalf.
So, 150 ships a year LNG; 100 oil tankers from the oil terminal itself.
This is going to be a very busy port; one of Russia’s newest ports.
When you see what’s been achieved here over the years it fills me with immense pride.
It’s the result of huge efforts by 25,000 people here at peak on the island - 45 different nationalities.
And on a frontier project like this you can never anticipate all the problems up front.
You have to be able to adapt and learn in some areas as you go along
and that’s what we’ve had to here to overcome the challenges.
We’ve been helped immensely by the strength of the joint venture:
Gazprom with its tremendous onshore pipelines experience;
Shell with its technology in LNG and offshore developments;
and of course Matsui and Mitsubishi with their huge knowledge of the LNG market.
When you see it all coming here together you realise just what it takes
to develop projects such as this in this sort of environment.
It’s been very challenging but also very very satisfying.
And I’d like to think that what we’ve done here,
this blend of national expertise and international resources,
is perhaps a model for future projects like this.
The project on Sakhalin Island exports liquefied natural gas (LNG) and oil to the fast-growing energy markets in the Asia-Pacific region. Its major customers are located in Japan, South Korea, Taiwan, China, Malaysia, the Philippines and Singapore. The first Sakhalin-2 LNG cargo arrived in Japan’s Tokyo Bay in April 2009.
The LNG plant has reached full capacity and now exceeds its annual design output, producing 10.93 million tonnes of LNG in 2016.
Offshore platforms in an icy sea
The platforms that produce Russia’s first offshore oil and gas, 15 kilometres off Sakhalin Island, stand in water up to 50 metres deep in the stormy Sea of Okhotsk. They are the Piltun-Astokhskoye-A platform (also known as ‘Molikpaq’), Piltun-Astokhskoye-B and Lunskoye-A platforms.
In this region, temperatures can drop to -45 degrees Celsius (-49° Fahrenheit) in winter. Arctic winds combine with high humidity for a wind-chill factor of -70°C (-94°F). At such temperatures, people can work outside only in short shifts - despite steel cladding on the outer sides of the platforms that breaks the wind, offering some protection.
Frozen seas and earthquake zone
Ice poses serious technical challenges too. From December to May, a thick layer of ice surrounds the platforms in the Sea of Okhotsk, preventing tankers from reaching them to load oil and gas. Instead, a 300-kilometre network of underwater pipelines takes the hydrocarbons ashore year-round.
Two major earthquakes of 6.4 and 7.6 on the Richter scale have struck the Sakhalin region in the past 15 years. The platforms are designed therefore to resist the kind of enormous earthquake that occurs perhaps once in 3,000 years. The topsides, or upper parts, of two of the platforms are connected to their concrete legs by sliding joints. If an earthquake strikes, they can move independently from the legs in a pendulum motion, preventing damage.
Ridges of compressed ice can carve deep gashes in the seabed and could damage pipelines. A thick concrete coating protects them, however, and they are buried five metres beneath the seabed wherever the sea is less than 30 metres deep. As an extra safeguard, electronic leak-detection systems including valves halt the flow of oil and gas if the pressure drops.
Protecting western gray whales
Western gray whales, a species brought to near extinction by commercial whaling early in the 20th century, feed in the waters off Sakhalin Island. Sakhalin Energy rerouted the offshore pipelines 20 kilometres to the south to avoid the feeding grounds, following advice from an independent panel of scientists set up under the International Union for Conservation of Nature (IUCN). In recognition of its western gray whale protection programme, Sakhalin Energy won the 2008 Environmental Project of the Year award from Russia’s Ministry of Environment and Natural Resources.
To protect the whales, sound levels in the area are constantly monitored. During construction, work such as drilling and pipelaying was suspended when the noise exceeded levels recommended by scientists. Buoys with acoustic monitors positioned along the edge of the feeding grounds track sound levels. The large-scale research programme is jointly financed by Sakhalin Energy and ExxonMobil, the operator of the Sakhalin-1 project. During the 2016 field season, 14 new calves and one adult whale, which had not been previously recorded, were identified in the waters around Sakhalin. Updates have been made to the Sakhalin photo catalogue, where the total number of registered individual whales has now increased to 274.
Pipelines crossing seismic faults and salmon rivers
Once the hydrocarbons are pumped ashore, a processing plant treats gas and condensate, a natural gas liquid, from the Lunskoye-A platform, along with oil and some gas produced by the Molikpaq and Piltun Astokhskoye-B platforms. From there, the gas is sent through two parallel 800-kilometre pipelines to the Prigorodnoye production complex at Aniva Bay in the south of the island, which includes an LNG plant, an oil export terminal and a port which is virtually ice-free during winter.
As long as the distance from Paris to Berlin, the pipelines cross seismic faultlines at 19 places and more than 1,000 of Sakhalin Island’s 60,000 rivers and streams. The 8,000 construction workers who built them could only start work after unexploded munitions from World War II had been cleared.
Engineers planned the onshore pipeline route to avoid most of the active faults, where even low levels of seismic activity could cause ruptures. If no alternative route existed, they used pipeline segments made of steel that can bend up to four metres without breaking.
Sakhalin Energy planned the route to create the least disturbance to vulnerable species, such as the Steller’s sea eagle and Siberian spruce grouse, and to the island’s rich vegetation. Laying the pipelines beneath streams where salmon spawn — a highly sensitive operation — mainly took place in winter when the water was frozen.
Harnessing the cold to produce LNG
The gas arrives at Prigorodnoye production complex after a day-long journey from the platforms. There Sakhalin Energy has built Russia’s first LNG plant, designed to produce 9.6 million tonnes of LNG a year. That is enough to generate electricity for around 24 million European homes. Almost all the production capacity is committed in long-term contracts to supply customers in the Asia-Pacific region.
Shell developed an energy-saving process for subarctic conditions that takes advantage of the low ambient temperatures to cool the gas and turn it into a liquid.
The new oil export terminal next to the LNG plant has the capacity to store 1.2 million barrels of oil — six days of pipeline supply. Heating elements fitted inside the floating roofs of the storage tanks ensure that snow in winter does not build up into a heavy load. Instead, it melts and slides off. A pipeline on the seabed transports the crude oil to tankers waiting to be loaded at Tanker Loading Unit located 4.8 kilometres from the Prigorodnoye coastline.
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The three oil and gas platforms off Sakhalin Island can withstand a harsh climate and earthquakes.
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