Open AccessA feasibility study of flare gas utilization through a small-scale LNG development in South Sumatra, Indonesia
Author(s) -
Massita Ayu Cindy Putriastuti,
Filda Citra Yusgiantoro,
Haryanto Haryanto,
I. Dm R. Margenta
Publication year - 2021
Publication title -
iop conference series. earth and environmental science
Language(s) - English
Resource type - Journals
eISSN - 1755-1307
pISSN - 1755-1315
DOI - 10.1088/1755-1315/753/1/012029
Subject(s) - payback period , profitability index , flare , net present value , internal rate of return , liquefied natural gas , environmental science , production (economics) , scale (ratio) , business , economics , natural gas , engineering , waste management , finance , geography , microeconomics , aerospace engineering , cartography
This study focused on assessing the economic feasibility of Small-Scale LNG (SSLNG) development from a flare gas in South Sumatra, Indonesia. The study measured profitability using three financial indicators: internal rate of return (IRR), net present value (NPV), and payback period (PP). The study also used sensitivity analysis to find selected variables that are strongly correlated with the economic aspects of SSLNG production. The variables consist of (1) Average flare gas production; (2) Flare gas price; (3) LNG selling price; (4) CAPEX; and (5) OPEX. The study also used those variables to find the optimum result with scenario analysis. The results show that the SSLNG development from a flare gas is economically feasible if three variables: LNG selling price, CAPEX, and flare gas price follow the optimum scenario.