Page 7 - Euroil Week 05 2020
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EurOil COMMENTARY EurOil
“We can clearly see LNG volumes brought into Poland via the President Lech Kaczynski LNG Terminal in Swinoujscie are rising by the year,” the president of the PGNiG management board, Jerzy Kwiecinski, said in a statement. “ e rst quarter of 2020 will see peak activity in terms of LNG deliveries. By the end of March this year alone we are to receive ten cargoes com- ing in from di erent directions.”
PGNiG is still contracted to receive at least 8.7bn cubic metres per year of gas from Rus- sia under a long-term contract. However, this agreement expires in 2022, and the company has already informed Russia’s Gazprom that it will not renew it. is, coupled with an expansion of the Swinoujscie LNG terminal’s capacity, paves the way for Poland’s LNG imports to continue growing.
more competitive than truck-to-ship supply. New pricing tari s, due to be introduced on October 1, are also aimed at boosting demand for marine LNG. Rojo Bianco expects such demand to take o as a result of the Interna- tional Maritime Organisation (IMO) 2020 reg- ulations limiting sulphur in marine fuel, which came into force at the start of this year. Spanish tari s for LNG truck supply will be cut by 15%, while tari s for LNG bunkering vessels will be slashed by 94%.
Separately, the Port of Barcelona has said that it is positioning itself as the main supply hub of LNG in the Mediterranean. e port reported last week that it handled 18 LNG bunkerings in 2019, and it expects LNG-fuelled ships to account for 10% of its cruise tra c in 2020.
What next?
e examples of Poland and Spain are just two pointing to Europe’s appetite to keep LNG a sig- ni cant and growing part of its energy mix. For LNG producers bracing to go through a more challenging year, signs of new demand will be welcomed and encouraged.
The implementation of IMO 2020 rules is anticipated to boost demand for LNG as a marine fuel globally, even though a number of obstacles still stand in the way of more wide- spread adoption of LNG-fuelled vessels. News related to LNG bunkering is coming from other European countries beyond Spain too, and over the course of this year the impact of the IMO 2020 rules will become clearer.
Even if marine fuel demand is taken out of the equation, however, it seems that Europe’s interest in LNG will only grow in the short and medium term.
Spanish hub
LNG infrastructure developments elsewhere in Europe are also being reported, in some cases bolstered by the increasing adoption of LNG as a marine fuel. is week, Enagas’ head of commer- cial, Angel Rojo Bianco, outlined at a conference his company’s plans to drive the expansion of the LNG bunkering sector in Spain as well as inte- grating all of the country’s LNG terminals into a “virtual LNG hub”.
e integration of operations at six LNG ter- minals – as well as two that are currently under development – will o er a combined 63.5 bcm of regasi cation capacity and 3.3mn cubic metres of storage capacity. Work to integrate their oper- ations will begin in April this year.
Spain will also introduce a new tari meth- odology in late 2020 that is expected to lead to LNG barge bunkering becoming much
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