In this blog post, we will outline the concept and advantages of LNG-FPSOs, their core technologies, and the challenges facing South Korea’s shipbuilding and offshore industry.
What are offshore plants and LNG-FPSOs?
Due to the recent slowdown in the global economy, the shipbuilding and offshore industry is experiencing a general downturn. South Korea’s shipbuilding sector, which has traditionally been a strong point, is no exception, and there are growing calls to shift focus from relying solely on shipbuilding to making offshore structures—namely, the offshore plant industry—a key growth driver. Offshore plants refer to the facilities and equipment required for the exploration, drilling and production of resources such as oil and gas in the sea. They are broadly divided into the topside—the upper structure where the actual processes take place—and the hull, which is the floating or fixed vessel section.
Offshore plants are classified into various types depending on their purpose and installation method. By purpose, they are categorised into drilling structures for resource exploration and production structures for processing, storing and treating the resources obtained through drilling; by installation method, they are divided into fixed structures anchored to the seabed and floating structures moored on the water’s surface. Fixed structures are designed to withstand their own weight and environmental loads with their bases anchored to the seabed, and are mainly used in coastal areas or shallow waters; floating structures, on the other hand, remain afloat in deep waters and are positioned using a mooring system so as not to be affected by water depth.
FPSO stands for Floating Production Storage and Offloading, meaning ‘floating crude oil production, storage and offloading facility’. Put simply, it is an oil refining and production facility floating on the sea, built to develop deep-sea oil fields; it is generally a large structure measuring approximately 300 metres in length, 60 metres in width and over 30 metres in height. It is an ultra-high-value-added piece of equipment, costing between 1 trillion and 2 trillion won. FPSOs fall under the category of production and floating offshore plants, and there are two types: FPSOs that process crude oil and LNG-FPSOs that process natural gas. In both cases, products are stored following chemical processing on the topside.
In particular, LNG-FPSOs have been attracting significant attention recently. Conventional offshore gas production involved extracting gas from an offshore platform, transporting it to land via pipeline, liquefying it at onshore facilities for storage in tanks, and then transporting it by LNG carrier. An LNG-FPSO combines production, liquefaction and storage functions in a single unit, eliminating the need for onshore facilities. Given the high costs associated with liquefaction and long-distance transport of LNG, LNG-FPSOs, which perform liquefaction, storage and offloading directly at the site, can offer significant economic benefits.
Core Technologies and Domestic Challenges
The government has also recognised the importance of the offshore plant industry and has set out to secure strategic technologies. The Ministry of Trade, Industry and Energy has selected 100 strategic technologies for the offshore plant sector and established a technology roadmap, categorising these into four areas: drillships, FPSOs, LNG-FPSOs and subsea systems. The LNG-FPSO sector includes approximately 26 core technologies, such as liquefaction systems and engineering technologies.
Key technologies required for the construction of LNG-FPSOs include, in particular, LNG tank design, sloshing analysis, and mooring system technology. As LNG tanks must maintain ultra-low temperatures (approximately -163°C), they are often designed with a double-walled structure and contain appropriate insulation material. A combination of primary structures made from materials such as nickel steel and aluminium alloys, and secondary structures made from stainless steel, is typically used, and research is ongoing to improve tank efficiency.
Sloshing is a phenomenon whereby LNG inside the tank moves due to ship motion or waves, causing impact against the tank walls. As LNG-FPSOs are at sea, they are significantly affected by waves and ship motion; consequently, the loads acting on the tanks may increase. Therefore, during the design phase, it is essential to accurately predict sloshing and carry out simulations and structural reinforcement to ensure the structure can withstand these forces.
Loading and unloading operations linked to mooring are also crucial. To transfer LNG stored on an LNG-FPSO to an LNG carrier, the two vessels must be positioned side-by-side for unloading. In the marine environment, this requires maintaining an optimal distance and controlling mooring to minimise the unloading distance economically whilst reducing the risk of collision. Key factors in this process include the reliability of the mooring system, dynamic positioning technology, and safe connection and disconnection procedures.
Currently, South Korea exhibits certain weaknesses in the design and production technology of the topside—which can be considered the core of an LNG-FPSO—and is securing orders by importing some components from Europe and assembling them locally. However, if the country can independently secure comprehensive design and engineering capabilities, including those for the topside, and thereby complete and secure orders for LNG-FPSOs on its own, it will significantly increase the added value of the shipbuilding and marine industry and contribute to overcoming the current downturn.
Offshore plants, particularly LNG-FPSOs, are a future industry sector attracting attention from many countries. For South Korea’s shipbuilding and offshore industry to grow again, continuous investment and research into relevant technologies are necessary; it is only when we secure our own core technologies that we can look forward to a new golden age for the industry.
