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BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry
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Klaipeda LNG capacity snapped up by three terminal users

LNG bunker supplier Litgas amongst the companies to have reserved terminal capacity in advance.

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Updated on 08 Jun 2017 09:34 GMT

Lithuania's Klaipedos Nafta (KN), operator of the floating LNG terminal in Klaipeda, Lithuania, has signed contracts with three terminal users who have been allocated part of the terminal's capacity before the start of the new gas year.

The terminal's capacity has been pre-booked by LNG bunker supplier UAB Litgas, the natural gas supply and trading arm of the state energy group Lietuvos Energija (Lithuanian Energy); UAB Lietuvos duju tiekimas (Lithuanian gas supply); and AB Achema.

"This is the first time in the almost three years of operation of the LNG terminal, where up to three terminal users have reserved terminal capacities in advance during the preliminary annual terminal capacity allocation procedure, and have thus secured their gas delivery services over the coming gas year," Klaipedos Nafta said.

According to the terminal operator, the three firms plan to import a total of 11 conventional LNG cargoes.

Explaining how the capacity booking process works, Mindaugas Jusius, general manager of Klaipedos Nafta, said: "KN announced its preliminary process in accordance with the annual LNG terminal capacity allocation procedure, since market participants plan part of their take-up of goods in advance, and they order the rest of the LNG terminal capacity during the gas year.

"The flexibility of the LNG terminal's service provision, on the principle of access to third parties, provides opportunities to order additional capacity as the need arises, dictated by the spot market, which our terminal customers have so far used successfully."

The preliminary capacity allocation procedure was announced by Klaipedos Nafta on April 25. The new gas year runs from October 1, 2017, to September 30, 2018.

As previously reported by Bunker Index, UAB Litgas performed a landmark LNG bunker delivery to the Skangas-operated Coral Energy at the start of the year when it was the first small-scale tanker to load LNG at the port of Klaipeda. The delivery was the result of an agreement signed last September by Litgas, Lietuvos Duju Tiekimas and Statoil, where it was agreed that Statoil would sell LNG to small-scale buyers and Litgas and Lietuvos Duju Tiekimas would provide modulation and balancing services.

The concept of a joint cooperation to develop an LNG bunkering service in Lithuania was identified in a five-year supply contract signed by Litgas and Statoil back in August 2014.

As part of the agreement, Statoil was contracted to supply an annual volume of 540 million cubic metres (cbm) of natural gas (approximately 950,000 cbm of LNG) to ensure the continuous operation of the Klaipeda LNG terminal.

This was followed in July 2015, when Litgas, Lietuvos Energija and Statoil signed a memorandum of understanding (MoU) to set up a joint venture company in Lithuania to provide small-scale LNG bunkering.

Last November, Bunker Index reported that the European Commission's (EC) Innovation and Networks Executive Agency (INEA) had confirmed a grant agreement to fund Klaipedos Nafta's LNG infrastructure project. The EUR 4 million is to be used to develop an LNG reloading station, small-scale LNG equipment for Klaipedos Nafta's LNG Terminal and LNG jetty equipment.

Development of the LNG reloading station is ongoing; it is scheduled to begin operating later this year.

Related Links:

Fluxys and Klaipedos Nafta sign LNG MoU
Baltic LNG bunkering network gains momentum
Gas-fuelled Coral Energy is first small-scale LNG tanker to load in Klaipeda
EUR 4m funding for Klaipeda LNG project gets go-ahead
LNG reloading station contract awarded

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