FSRU Credit BV

FSRUs: a fast-track solution to diversify gas imports and support the energy transition

The current geopolitical situation has led to growing demand for floating storage and regasification units (FSRUs) to diversify gas imports. The industry will need to act quickly to meet this need and bolster energy security.

The urgent need for FSRUs

Recent world events have drawn attention to Europe’s dependence on unique sources for gas imports, sent through pipelines. To tackle energy security concerns, the industry is setting its sights on a wider gas supply market with liquefied natural gas (LNG).

Answering this demand, recent months have seen an explosion of short-term and spot contracts in the LNG supply market with head-turning prices. This has brought FSRUs, a perfectly adapted technical solution that can be brought online faster, to the limelight. These are:

  • Floating units, either new or converted from LNG carriers (LNGCs), that
  • Store LNG transferred from LNGCs and
  • Regasify it using vaporizers and other components, before sending it to shore through pipelines

In addition to delivering the greenest of fossil fuels for energy supply, FSRUs are a faster way to get gas to the grid. Land-based LNG terminals may take longer to be set up and are thus an insufficient response to an immediate problem.

​​​​​​​Despite the urgent need for FSRUs, there are no more than 10 still available according to our market assessment. The remaining 50 FSRUs are already chartered or under discussion for relocation. An example of a fast-track project is Exmar’s BV class S188. Delivered in 2017, the unit will be chartered by Dutch gas infrastructure company Gasunie for five years. To deploy new FSRUs in the shortest timeframe, operators now need to evaluate conversion and new build options.

Jose Esteve

Market Leader for Offshore Gas & Power

Bureau Veritas Marine & Offshore

We’re seeing a sharp sudden increase in demand for FSRUs, particularly in Europe to diversify gas imports. Bureau Veritas has classed more than a third of existing FSRUs and is supporting several conversions in gas-to-power developments that combine FSRUs with power barges. Drawing on our expertise, we can support owners and operators to get their vessels operating as quickly as possible.

FSRUs: conversion or new build?

Building new FSRUs and converting existing vessels both have their advantages and disadvantages. A new build can take a long time to deliver, particularly nowadays since shipyard slots are mostly full until 2025 and containment systems requirements for FSRUs, like LNGCs, are very specific. GTT membrane design is usually the preferred option, which restricts which shipyards can build them and leaves deployment vulnerable to supply chain limitations.

However, a new build enables owners to define the LNG capacity required and build it to their specifications. This includes reducing sloshing risk, for example, as the cargo containment walls are designed to sustain the potential impact loads. Furthermore, as a brand-new vessel, owners can expect lower OPEX costs compared to an older unit, for which maintenance and efficiency losses are typically higher.

With this in mind, conversions are an alternative solution to bolster the current FSRU fleet. There are many existing LNGCs that could be converted into FSRUs. Good candidates for conversion include those vessels that may struggle to comply with the IMO’s EEXI – estimated at 30% of the current fleet by industry sources. LNGCs are also reputedly well-maintained, thanks to charterers’ requirements that they satisfy a minimum Condition Assessment Program (CAP). Conversion may therefore be a relatively quick solution with limited risk to reduce energy insecurity.

On the other hand, LNGC conversions are limited in storage capacity, and therefore may be used as storage-only FSUs, serviced in groups by a separate regasification module. This option has the benefit of reducing the necessary conversion time.

How to ensure successful FSRU deployment

When deploying an FSRU, owners have many aspects to consider. Fully independent FSRUs – capable of staying in open sea for more than five years – need around 18 months to be converted. This is due to the additions of long-lead items such as mooring lines, regasification modules and heat and power generation.

Whether an FSRU has propulsion (new or converted) will also influence owners’ considerations. Three important points when keeping the propulsion are:

  • In-water survey requirements
  • Shaft surveillance requirements
  • Ballast water management regulations

Fixed FSRUs are not considered trading ships, and therefore flags may accept the derogation of some of the IMO IGC Code requirements. Although FSRUs are usually exempt from EEXI and EEDI, they may still be impacted by local regulations in coastal areas with strict pollution and emissions requirements. Finally, fixed FSRUs can benefit from an alternative inspection regime to that of trading ships. For this they must have their inspection and maintenance plan drafted and approved by Class before starting operations.

Supporting FSRU construction and deployment

As an expert in Class, BV Marine & Offshore is well placed to assist owners and operators with the transition to wider FSRU use. We have a dedicated rule note for FSRUs and a Guidance Note for the conversion of LNGCs to FSRUs. BV Marine & Offshore engineering experts stay abreast of all technological advances relating to FSRUs. They are able to carry out independent numerical analysis to check seakeeping, mooring and hull resistance and CFD sloshing analysis.

Bureau Veritas’ Rule Notes & Guidance Notes for FSRUs

Rules Notes

  • NR 467 - Rules for the Classification of Steel Ships
  • NR 493 - Rules for the Classification of mooring systems for permanent offshore units
  • NR 542 - Classification of floating gas units
  • NR 645 - Rules for the Classification of Floating Storage Regasification Units and Floating Storage Units
  • NR 686 - Rules for the design and certification of membrane type LNG cargo containment system

Guidance Notes: 

  • NI554 - Design sloshing loads for LNG membrane tanks
  • NI564 - Strength assessment of LNG membrane tanks under sloshing loads
  • NI623 - Condition assessment programme for LNG carriers (LNG CAP)
  • NI655 - LNG carrier conversion to FSRU or FSU

In 2005 BV Marine & Offshore was the first society to class regasification vessels, thanks to the trust of major player Excelerate. We have classed dedicated units such as Gasfin’s Torman FRU unit and the largest ever new-built FSRU for MOL. We continue to support these fixed FSRUs at their different locations, dock-side or offshore.

Experts in FSRUs, BV Marine & Offshore is by your side to provide support and guidance for a successful new build or conversion project.