Floating liquefied natural gas (FLNG) terminals are increasingly impacting the global LNG market, with Rystad Energy forecasting a threefold increase in capacity by 2030.
Despite past technical and operational hurdles, FLNG projects now achieve utilisation rates similar to onshore terminals.
As LNG demand grows and smaller gas fields become more viable, FLNG offers a quicker, more adaptable, and cost-effective solution, capable of responding to evolving market conditions and tapping into previously inaccessible reserves.
Global FLNG capacity is projected to surge to 42 million tonnes per annum (Mtpa) by 2030 and then to 55 Mtpa by 2035, a substantial increase from the 14.1 Mtpa recorded in 2024.
This growth, estimated by Rystad Energy, represents nearly a fourfold expansion.
Source: Rystad Energy
Notably, FLNG terminals operational before 2024 have demonstrated strong performance, achieving an average utilisation rate of 86.5% in 2024 and 76% thus far in 2025, figures that align with those of global onshore LNG facilities.
“FLNG has come a long way in less than a decade. The only real roadblocks were early teething issues that come with any new technology, as seen with projects like Shell’s Prelude, which faced cost overruns and unstable output,” Kaushal Ramesh, vice president, gas & LNG Research, Rystad Energy.
But since then, the industry has matured significantly, including Prelude itself. Utilization rates are improving, the technology is proving reliable across a range of environments, and the economics are starting to make more sense.
Projects
Early FLNG (Floating Liquefied Natural Gas) projects, like Shell’s Prelude, constructed in South Korea by the Technip–Samsung consortium, served as a negative illustration of the initial limitations of FLNG, largely due to the absence of a pre-existing blueprint.
The cost of liquefaction alone escalated significantly, reaching $2,114 per tonne.
Nonetheless, with increased operational and construction expertise within the industry, capital expenditure per tonne has fallen considerably, aligning costs with onshore LNG projects.
Proposed developments along the US Gulf Coast have an average cost of approximately $1,054 per tonne, according to Rystad.
Delfin FLNG, a proposed US project, is slightly above this average at $1,134 per tonne. Coral South FLNG in Mozambique, a project of similar scale, has a comparable liquefaction cost of $1,062 per tonne.
The Norway-based energy intelligence company added:
However, we note that project concepts are not entirely comparable. Some are complex integrated producers with upstream components as part of the LNG facilities, while others simply liquefy pipeline-spec gas.
Source: Rystad Energy
Vessel conversions
Meanwhile, FLNG developers are increasingly opting for vessel conversions over newbuild facilities as a more cost-effective solution.
By repurposing Moss-type LNG carriers, projects like Tortue/Ahmeyim FLNG, Cameroon FLNG, and Southern Energy’s FLNG MK II have achieved significantly lower capital expenditure levels, specifically $640, $500, and $630 per tonne, respectively.
The vessels’ modular spherical tank design facilitates these conversions by enabling easier integration of prefabricated liquefaction modules.
The anticipated retirement of several Moss-type LNG tankers in the coming years presents an opportunity for their repurposing. This could lead to an increase in cost-effective FLNG solutions.
FLNG vessels demonstrate operational flexibility in various environments, including deepwater, ultra-deepwater, and onshore supply.
“Should certain projects stall, their vessel could be relocated or sold, demonstrating the inherent mobility and adaptability of FLNG assets,” Rystad said.
Accelerating time
In today’s energy landscape, characterised by tight markets and the potential for oversupply, achieving rapid first production is paramount, according to Rystad.
Extended construction timelines delay revenue generation and expose projects to a higher risk of cost overruns.
FLNG units offer a significant advantage over onshore liquefaction facilities due to their faster delivery times, which allows for quicker final investment decisions and more agile project execution, according to Rystad Energy data.
Newbuild FLNG projects typically finish in about three years, which is notably quicker than the approximate 4.5 years (capacity-weighted) required for operational onshore plants.
FLNG vessels presently being built are expected to have an average construction period of just 2.85 years.
The growing preference for FLNG is largely driven by its accelerating timeline, which allows developers to minimise exposure and expedite returns.
