Disclosed is a system in which saturated mercury adsorbent in a gas mercury removal unit is dehydrated in a LNG, LPG or cryogenic gas plant using a regeneration gas stream. Spent regeneration gas stream is then condensed and the water is removed therefrom to form a renewed regeneration gas stream in a closed loop. The regeneration gas stream is compressed and recycled to a location in the plant upstream of an acid gas removal unit or upstream of a regeneration gas dehydration unit such that the regeneration gas stream is not sent to a flare. A dehydration unit having a pair of dehydration vessels, arranged in parallel, alternating between absorption and regeneration modes, receives gas from the compressor. Conventional plants can be retrofitted to achieve improved process efficiencies, cost savings and environmental benefits.