Page 7 - FSUOGM Week 45 2019
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FSUOGM PIPELINES & TRANSPORT FSUOGM
Lithuania to acquire its own LNG FSRU
Lithuania currently imports LNG using the FSRU Independence .
LITHUANIA
LITHUANIA is looking to buy its own floating, storage and regasification unit (FSRU), at a time when its imports of LNG are at an all-time high.
The board of state-owned Klaipedos Nafta (KN) said it supported a plan to buy either the Independence FSRU it is currently leasing from Norway’s Hoegh LNG or a different vessel. A final decision on the matter is anticipated by the end of 2022.
KN aims to reach a deal with banks to obtain financing for the purchase by the end of April 2020, and have the state-guaranteed loans cleared under EU state aid rules by the end of May 2021.
By having its own FSRU rather than renting one, Lithuania would presumably save costs in terms of rental fees. It aims to cut costs further by borrowing €135.5mn ($150mn) from the Nor- dic Investment Bank to cover rent payment for the FSRU from 2020, saving €27mn per year for consumers.
“Estimates show that the LNG terminal will provide economic benefits for Lithuania and gas consumers of the region after 2024,” KN Klai- pedaLNGdirectorArunasMolissaid.“Asareli- able alternative for gas import, the LNG terminal will ensure competition in the gas market and
contribute to the energy security of the state. In turn, this provides Lithuania with opportunities for regional leadership in the energy sector and for KN to further actively develop the cross-bor- der LNG chain of value.”
Lithuania launched the 4bn cubic metre per year Klaipeda LNG terminal in 2014, but in its early years the project found it difficult to com- pete with cheap and readily available Russian pipeline gas. Thanks to a slump in global LNG prices, however, it managed a 40% growth in imports during the first nine months of 2019, receiving LNG carriers during the period, versus eight a year earlier.
The terminal’s biggest customer is Lithuanian fertiliser producer Achema. It has two more Lith- uanian clients – energy group Lietuvos Energijos Tiekimas (LET) and commodities trader Imlitex – as well as Estonian power group Eesti Energia and Estonian gas distributor Elenger.
Lithuania developed its LNG import capa- bility to help wean itself off its heavy reliance on Russian gas. However, while it has success- fully reduced its dependence on Russian piped exports, Achema and the terminal’s other buyers are in fact buying significant quantities of Rus- sian LNG, according to recent shipping data.
Week 45 13•November•2019 w w w . N E W S B A S E . c o m P7
