Page 15 - GLNG Week 36

GLNG EUROPE GLNG

Hungary signs historic gas deal with Shell

PROJECTS & HUNGARY will buy 250mn cubic metres of cuts. Before the 2014 elections, the government
COMPANIES LNG from Royal Dutch Shell from next year, has ordered a mandatory fixing of utility prices,
according to a historic agreement reached on which were left unchanged even as global market
Friday, local media writes on September 4. This prices continued to go downward.
is the first long-term LNG purchase agreement Szijjarto said Hungary wanted to increase the
with a Western energy company in Hungary’s share of LNG in its energy portfolio as its price
history, said Minister of Foreign Affairs and has fallen below that of piped natural gas.
Trade Peter Szijjarto at a press conference. Hungary covers 80-90% of its gas needs from
The gas will be On Friday, state-owned electricity company Russia. It has recently agreed with Gazprom
supplied via the Krk MVM signed a six-year deal with Shell on the on the delivery of 4.2 bcm of gas in the twelve
LNG terminal, which is delivery of 250 mcm of LNG from the Krk termi- months from October 2020. Talks are reported
under construction in nal in Croatia, which is to start operating in 2021. to have begun on deliveries after 2021.
Croatia. In June, MVM’s Croatian subsidiary MFGK Cro- Hungary has established interconnectors
atia tied down 1bn cubic metre capacity annually with six out of seven countries to allow the pur-
for seven years at the Krk terminal. chase of gas through as many routes as possible,
This means that 10% of the country’s natural Szijjarto said. This is in line with the govern-
gas requirements will be met from the Krk termi- ment’s policies to diversify its energy purchases
nal until the end of 2027, and reduce dependence on gas coming from
The LNG will be delivered to Hungary Russia.
via the Hungary-Croatia gas pipeline after Shell is one of the pioneers of the LNG sec-
regasification tor, with over 50 years of experience in the pro-
The contract has been concluded at a com- duction, trade, storage and transport of LNG,
petitive price that will enable the protection of said Shell’s global executive vice-president Ist-
the results of the state-ordered public utility van Kapitany.™

Arctic LNG-2 secures financing

for entire LNG tanker fleet

PIPELINES & RUSSIA’S Novatek has now secured all the Russia has never before built LNGCs, with all
TRANSPORT financing it needs to develop a fleet of tankers the vessels that service Novatek’s existing Yamal
to carry gas from its $21bn Arctic LNG-2 pro- LNG plant engineered in South Korea. Zvezda –
ject. The vessels will be the first of their kind to run by a consortium of state-owned companies
be built in Russia, at the Zvezda shipyard in the Rosneft, Rosneftegaz and Gazprombank – is to
Far East. play a key role in developing Russia’s shipbuild-
The agreement was signed between Smart ing capability and reducing the country’s reliance
LNG, Novatek’s joint venture with state ship- on foreign yards. In addition to LNGCs, Zvezda
owner Sovcomflot, and state development bank is also set to build dozens of oil tankers and other
VEB.RF. It covers the construction of 10 Arc7 cargo ships over the coming years.
ice-breaking LNG carriers (LNGC). Novatek Changes to Russia’s merchant shipping code
also struck a deal on chartering 14 vessels. have banned the use of foreign-flagged and for-
These two agreements mean Novatek now eign-built vessels to transport oil and gas along
has financing, construction and chartering the country’s Arctic Northern Sea Route (NSR).
contracts in place for Arctic LNG-2’s entire However, Novatek has raised concerns that this
15-strong tanker fleet. It arranged all necessary restriction will slow the pace of its development
contracts for a first, pilot vessel in October last plans.
year, and went on to secure financing for four The company managed to secure an exemp-
more in February, without arranging chartering. tion for Yamal LNG’s 15 LNGCs. And while all
The Arctic LNG-2 project consists of three Arctic LNG-2’s tankers are due to come from
liquefaction trains each capable of producing Zvezda, it has obtained a similar exemption for
6.6mn tonnes per year (tpy) of LNG. The first the 10 ships it plans to order for another of its
is due on stream in 2023, while the second and upcoming LNG projects, Obsk LNG. A final
third are slated to begin operations in 2024 and investment decision (FID) on Obsk LNG was
2026. That means Zvezda has over three years to expected by mid-2020 but has been delayed in
deliver the first LNGC and six to supply the last. light of the market collapse.™

Week 36 11•September•2020 www. NEWSBASE .com P15