Photo by Algimantas Barzdius
In order to secure the supply of natural gas in the long run, Lithuania is preparing to purchase the liquefied natural gas (LNG) terminal storage vessel Independence from the Norwegian company Hoegh LNG. No alternative to the current vessel was received.
At the meeting of the Seimas Energy and Sustainable Development Commission, Mindaugas Navikas, Klaipda Oil Commercial Director of the terminal operator, stated that Independence had been recognized as the best option.
After assessing all the technological, commercial and existing aspects, we recognized that Independence, the event that operates in Klaipda today, is the best option to buy Klaipda oil in December 2024, said M. Navikas.
He says that the current users of Klaipda terminal want to keep the existing ones or have even better parameters than Independence provides. In turn, the smaller ship-storage facility will change the attractiveness of the terminal in Klaipda, which will increase the use of the terminal.
The obvious trend is that about 170,000 cu. m this is the storage capacity, the same as in the case of Independence, is a global trend, and in practice recently smaller is not much and is done, well, maybe Croatia is smaller, says M. Navikas.
Lithuania is considering options to purchase a used storage vessel with a regeneration unit (FSRU), a new such vessel or to convert it into a gas station.
Among the main conditions of the tender were the ceiling of the purchase amount (EUR 160 million), adaptation to working in Lithuanian climatic conditions (as is typical for Independence), capacity and others.
As already announced in the summer, Klaipdos nafta does not receive an alternative to the Independence storage vessel. Lithuania will seek to buy it from Norwegian Hoegh LNG, from which it is now leased.
We see that the market must have only the shipowner Golar specifically mentioned, but in our estimation, its value was much higher: from 200 million. up to 225 million Euras. But it would have no operating system (Independence has a system in the BNS), and its ship was not offered, says Navik.
Next year, it is planned to agree with Hoegh LNG and approve the main terms of the Independence purchase agreement, and to conclude an agreement from December 2022 to December 2024, Klaipdos Nafta stated.
iaurs investicij bankas (NIB) is lending up to 160 mln. Eur SkGD for the purchase of a vessel.
Vice Minister: there is an opportunity to change cats
Deputy Minister of Energy Inga ilien said that the benefits of the terminal for the country are unquestionable even with rising gas prices, but there is still an opportunity to change the terminal’s cats.
At the meeting of the Seimas Commission, I. ilien stated that the reorganization of the capacity ordering mechanism was being considered, as the terminal is not yet in full use.
According to I. iliens, the possibilities of closer cooperation with the Nordic and Southern countries are also analyzed.
The second direction is the integration of regional markets, that is, the northern natural gas markets of Finland, Estonia, Latvia, and also in the southern direction, the Polish natural gas market, and possibly Ukraine. We are working in that direction and we see that there really is potential for exchanging those cats, said I. ilien.
Among other things, she mentioned that the issue of the appointment of the designated supplier, ie Ignitis, was discussed at the commission meeting on Wednesday.
The Deputy Minister did not elaborate on the latter decision, but it has already been announced that the state-controlled Ignitis Group supplies electricity and gas to Ignitis with an agreement with Norwegian Equinor on an amendment to the agreement approving a more favorable LNG cargo supply structure.
The group then announces that the changes will save € 1,417 million. Eur for the remaining period of the contract from next year to the end of 2024. LNG cargo from Equinor is now significantly more expensive than the two on the market, and the price difference must be borne by all gas consumers.
I. ilien: as a country we are comfortable with
On Wednesday, the Deputy Minister of Energy also stated that the storage vessel allows Lithuania to supply gas at competitive prices.
Sometimes it is said that maybe the ship was not needed, because still the price of natural gas has risen now, namely the price of the product has risen, but remembering the very recent experience until 2015, before the LNG ship, the terminal, the price difference the price will differ by about 12 Eur from the price of TTF and Gaspool, it was definitely a very significant difference, said the Deputy Minister.
According to her, that difference was an additional component that was paid for by all consumers. According to I. iliens, the price difference from the Dutch TTF is less than 1 Eur.
We have access to the world market and we get really very competitive prices (…) We are now comfortable as a country, knowing that we can get natural gas from all over the world, says I. ilien.
Independence Klaipda jr port sailed in October 2014 The terminal has been operating since the beginning of 2015.
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