Abstract Nitrogen expander-based natural gas (NG) liquefaction processes are considered to be the most feasible and economic practices for offshore applications. The nitrogen single expander process is simple owing to its single-phase operation, and it employs high occupational safety and environment-friendly refrigerants. However, this process has low energy efficiency. Recent advancements in expansion devices show the possibility of handling two-phase refrigerant flow in an economical and simple manner. Accordingly, this paper proposes two-phase expansion using an innovative binary mixed refrigerant (MR) composed of ethane and nitrogen (C2N). Furthermore, a propane-precooling refrigeration cycle is also implemented and evaluated to analyze greater potential benefits of ethane–nitrogen refrigerant with two-phase expansion. To assess the technical and commercial feasibility of the proposed liquefaction process, energy, exergy, and economic (3E) analysis is performed. Using the C2N two-phase expander LNG process, 47.83% energy can be saved with 55.25% exergy destruction minimization and 24.12% total annualized costs (TAC) savings as compared to previously published nitrogen single expander process. Whereas, the C3-precooled C2N process gives higher energy savings i.e., 52.45% but low TAC savings i.e., 1.6% as compared to nitrogen single expander LNG process. Considering TAC savings, the C2N process (without propane-precooling) can be a promising candidate for offshore applications.