Ministry: LNG terminal conditions to be clarified in October

LNG terminal, Paldiski.
LNG terminal, Paldiski. Source: Alexela

Usage conditions for Estonia's new LNG container ship will be clarified next month, Timo Tatar, undersecretary of Energy of the Ministry of Economy, said on Monday. Discussions are still being held about where the ship will dock.

Estonia and Finland will share the LNG storage container when it is completed and it will be able to dock on either side of the Gulf of Finland.

Last week some of rules for market participants were announced but they are not yet in place. Tatar said they will be clarified in October and then companies will be able to book slots.

"While no one can book their slots, everyone is afraid that they might not be able to access the terminal. This is an understandable concern that we would like to get off the table as soon as possible," said Tatar.

It is still not known if the ship will dock in Finland or Estonia, but for Estonia's supply, it does not matter as both countries are connected to the Balticconnector pipeline, Tatar said. He said final analyzes are underway.

When the bilateral agreement was concluded during the spring, it was said whichever country built the terminal first would receive the ship. At the time it was thought Finland would not be able to develop its capacity by the winter, but this is not the case now.

"During the summer, the Finns put in a lot of effort, and so at the moment, it seems that [the construction of] both the Paldiski and Inkoo quays are moving at more or less the same pace. This means that other criteria will obviously be considered when locating the ship," said Tatar.

Ministry: Upkeep of terminal important even if ship docks in Finland

Tatar said if the ship docks at the Finnish terminal, Estonia will still consider the upkeep of the new Paldiski facilities a priority.

He said the quay will not be used for any other purpose and the government wants the terminal to be able to receive LNG ships in the future. If it is not used this winter, the state may buy it based on "real costs".

"Of course, our interest is not that we should buy the quay, our interest is that the infrastructure contributes to the security of gas supply in one way or another, so that it is possible to receive ships there," Tatar said.

While some market participants doubt there is enough need for two LNG berths with similar capacities, Tatar said other assessments say the opposite.

"We can see scenarios where market demand is greater than one terminal can provide," he said, adding it may be possible to sell LNG on to other countries in the region.

"The reason why gas prices are so expensive in Europe today is that Europe does not have enough LNG receiving capacity. Any receiving capacity and infrastructure can provide different opportunities in the coming years," said Tatar.


Follow ERR News on Facebook and Twitter and never miss an update!

Editor: Helen Wright

Hea lugeja, näeme et kasutate vanemat brauseri versiooni või vähelevinud brauserit.

Parema ja terviklikuma kasutajakogemuse tagamiseks soovitame alla laadida uusim versioon mõnest meie toetatud brauserist: