Klaipeda LNG Terminal

From Global Energy Monitor
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Klaipėda LNG Terminal is a floating LNG terminal in Lithuania.

Location

The map below shows the current location of the FSRU, in the port of Klaipėda, Klaipėda County.

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Project Details

  • Operator: Höegh LNG[1]
  • Parent: Klaipedos Nafta chartered the FSRU, but Höegh LNG owns the FSRU[1]
  • Location: Klaipėda Port, Klaipėda, Klaipėda County, Lithuania
  • Coordinates: 55.66451, 21.13762 (exact)
  • Capacity: 2.9 mtpa[1]
  • Financing: €87 million loan from the European Investment Bank[2]; two loans totalling €294.1 million from the Nordic Investment Bank[3]
  • Status: Operating
  • Type: Import
  • Start Year: 2014[1]

Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day

Background

Klaipėda LNG Terminal is a floating liquefied natural gas (FLNG) regasification terminal in Lithuania. The terminal is the FSRU known as Independence, built by Hyundai Heavy Industries in South Korea, and delivered to the Klaipėda port in October 2014; the ship is owned by Höegh, and leased for $68 million per year.[4][5][6][7][8][9]

In July 2013 the European Investment Bank signed an €87 million loan for the project with Klaipedos Nafta.[2]

According to Food and Water Europe's 2019 profile of gas use and production in Lithuania, "...the new LNG terminal hasn’t (yet) led to any significant change in the amount of gas consumed in the country. With an average use of only 23% in the Klaipeda terminal, it has not fulfilled the promises made by its promoters. Running at only 80% capacity, the terminal could cover the gas use of the entire Baltic region....the utilization rate of the terminal is quite low and a big share of the capacity is booked not by an energy company but a fertilizer producer, Achema." This 23% average utilisation rate was for the period 2012-2017.[10] According to Tadas Matulionis, LNG business director at Klaipedos Nafta, 2019 was a record year for the terminal with regasification and reloading volumes more than doubling from 2018. The terminal handled more than 60 ship-to-ship operations and saw utilisation rates of nearly 90% of nameplate capacity.[11]

In 2017, Lithuania signed the first deal to import fracked U.S. gas.[10]

Under EU state aid rules, the European Commission has twice (in 2013 and 2020) given Lithuania approval to issue state guarantees for loans for the project.[12] The state aid approved by the Commission in 2013 amounted to €448 million.[13] The latest state guarantee insures a loan agreement for up to €160 million between Nordic Investment Bank (NIB) and Klaipedos Nafta which will serve to finance the purchase of the FSRU and restructuring of the LNG terminal maintenance costs. In 2019, NIB granted Klaipedos Nafta a loan of €134.1 million to partly cover the operating lease payments and enable equalised tariff levels to be maintained throughout the full lifetime of the terminal.[3]

In January 2021, Lithuania's Energy Minister Dainius Kreivys suggested that there were plans for the Klaipeda terminal to supply the proposed Ostroleka power station, a power plant project in north-east Poland which was previously planned as a thermal coal plant but which is to be converted to a gas plant by its promoters. Ostroleka would receive the gas from Lithuania via the Gas Interconnection Poland-Lithuania (GIPL) pipeline, currently under construction and forecast to be operational by the end of 2021.[14]

Associated Pipelines

Two pipelines are associated with the Klaipeda terminal, connecting the terminal to the other Baltic countries. The Klaipeda Kursenai Gas Transmission Pipeline is a 111 km pipeline, with a 3.7 bcm/y transport capacity. It connects the LNG terminal to the Baltic gas market. Construction was completed in October 2015 (€60 million, with €27.6 million coming from EU funds). The proposed expansion of the Lithuania-Latvia Interconnection Gas Pipeline has been granted PCI status and will double the current capacity, reaching 4.4 billion cubic meters per year.[10]

Articles and resources

References

  1. 1.0 1.1 1.2 1.3 The LNG Industry: Annual Report 2020, page 52, International Group of Liquefied Natural Gas Importers, accessed April 29, 2020
  2. 2.0 2.1 Lithuania: EIB supports the construction of LNG terminal, European Investment Bank press release, Jul. 9, 2013
  3. 3.0 3.1 NIB continues partnership with Klaipėdos Nafta, Nordic Investment Bank press release, Mar. 9, 2020
  4. Klaipėda LNG Terminal, Wikipedia, accessed April 2017.
  5. FSRU Independence, Wikipedia, accessed July 2017.
  6. Klaipėda LNG Terminal, Klaipedos Nafta website, accessed July 2017.
  7. At Anchor Off Lithuania, Its Own Energy Supply, New York Times, 4 July 2013.
  8. Lithuania installs LNG terminal to end dependence on Russian gas, Daily Mail, 27 Oct. 2014.
  9. Klaipeda LNG terminal already cost Lithuania EUR 128 mln, The Baltic Course, 29 May 2015.
  10. 10.0 10.1 10.2 Lithuania, Food and Water Europe, accessed December 5, 2019
  11. Andrew MacDowall, "Tapping into Central Europe’s LNG boom", Castlereagh Associates, Feb. 14, 2020.
  12. The European Commission approves state aid measures to secure long-term operation of Klaipėda LNG terminal, Ministry of Energy of the Republic of Lithuania, Nov. 23, 2020
  13. State aid: Commission authorises €448 million aid for construction of Lithuanian LNG terminal, European Commission, Nov. 20, 2013
  14. Lithuania to supply LNG to a 750 MW power plant in Poland - minister, Reuters, Jan. 21, 2021

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External resources

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