LNG macro analysis, page-1285

Finland's main gas grid to directly access first LNG supply in 2020

The construction of a new liquefied natural gas terminal in Finland’s southern port of Hamina will be concluded by the end of 2020, allowing the country to reduce its dependency on Russian energy supplies, contractor Wartsila said.

Unlike Finland’s other two main LNG terminals in Tornio and Pori, which are located in the country’s remote north and west, Hamina is located just 150 kilometres from the capital Helsinki and will be able to directly supply the country’s gas network.

The terminal is the second Finnish project, along with a pipeline to Estonia called Balticconnector, that aims to reduce the country’s dependency on Russian gas, partly over concerns Moscow could use its monopoly for political influence.

“The terminal is expected to be completed by Q4 2020,” Wartsila’s vice president for LNG Alexandre Eykerman told Reuters in an e-mail.

“The country can diversify its gas supply which at the moment is solely from one provider. It is also closer to the Baltic countries,” he added.

Hamina’s proximity to the Baltic states means the terminal, which will initially have a storage capacity of 30,000 cubic meters (cm), will serve not only land-based customers but also marine ones as a bunkering station for local vessels.

The initial investment is about 100 million euros ($114 million), but there are plans to increase the new terminal’s capacity to 50,000 cm at a later stage, said Eykerman.

The Hamina terminal is designed to receive deliveries of a maximum of about 15,000 to 20,000 cm, depending on vessel size, so it will not be able to receive supersized tankers such as the ones that arrive at British ports, he added.

The project could even possibly be completed earlier than the fourth quarter of 2020, said Eykerman, if weather conditions that affect its construction allow it.

Wartsila has a minority investment in Hamina LNG Oy, the terminal’s owner, whose main shareholders are Hamina Energy Ltd and Estonian energy company Alexela.

OSLO (Reuters)