The Use of Natural Gas for Power Generation in Lebanon
Author | : Pierre Toufic El Khoury |
Publisher | : |
Total Pages | : 152 |
Release | : 2006 |
ISBN-10 | : OCLC:787847977 |
ISBN-13 | : |
Rating | : 4/5 (77 Downloads) |
Book excerpt: In this report, three different scenarios for the use of natural gas in power ge neration in Lebanon are analyzed using spreadsheets to come up with the possible operational savings that would result out of the implementation of these soluti ons and according to different fluctuations of international oil prices. The three scenarios include the supply of the Syrian gas to most power plants in Lebanon (scenario 1, theoretical what-if approach), the supply of the Syrian ga s to the Beddawi power plant (scenario 2, actual operation), and the option of a n FSRU-LNG to the Zahrani power plant (scenario 3). Based on some real data and calculated assumptions, the results show that saving s up to 172,000,000 USD per year (for a Brent price of 65 USD, equivalent to a g iven price of 9 USD/MMBTU as per the Law 509) can be achieved from the operation of the Beddawi power plant on natural gas. Consequently, we can say that any ga s purchasing contract offering natural gas to Lebanon at a cost price of 9 USD/M MBTU or less is basically a good package given that the calorific value of that gas does not fall below 35,000 BTU/m3. The study also shows that an LNG option is also beneficiary to Lebanon and can r esult in considerable savings as long as the service cost for the FSRU-LNG is no t higher than 3.5 USD and the discount factor does not exceed 25% (of the Brent barrel price). So even at a cost of 15.5 USD/MMBTU, LNG can be a good alternativ e. Finally, the report urges decision makers to be extremely aware when signing nat ural gas contracts for Lebanon. Special care should be given to the critical con cepts of "security of supply", "continuity of the supply", and "duration of the contract."