Elering: Paldiski LNG terminal 'missing' connection not in original deal

The LNG terminal at Paldiski, under construction during the summer.
The LNG terminal at Paldiski, under construction during the summer. Source: Alexela/Raul Mee ja MKM

A "missing" connection needed to complete the set-up at the Liquefied Natural Gas (LNG) terminal in the port city of Paldiski was not referred to in the original agreement, state-owned grid distributor Elering says.

The Paldiski terminal will have the capacity to host a Floating Storage Regasification Unit (FSRU) vessel, a ship specifically fitted out to carry LNG and to remain close to shore for as long as it takes to unload its complement.

Meanwhile another terminal has been built on the other side of the Gulf of Finland – both terminals are the result of a need to decouple from dependence on natural gas from Russia, following the invasion of Ukraine, and gas can be supplied in either direction, via the Balticconnector pipeline, which links Estonia and Finland.

The Paldiski terminal is built in three sections, namely the FSRU vessel itself, the quay and Elering's land-based connection with the Balticconnector pipeline.

Private sector firms Alexela and Infortar completed their work a month ago, ahead of schedule, but say that Elering has not held its part of the bargain – a claim which Elering rejects.

Elering CEO says the company had submitted an additional request to Alexela and Infortar and is awaiting their feedback, after which: "Hopefully, a specific connection offer can be submitted. On this basis, we will be able to say whether and to what extent the completed connection point needs to be constructed - what it will cost, how long it will take," said Veskimägi.

Company spokesperson Elo Ellermaa said: "From the outset, Elering's task has been to construct a pipe connection running from from the gas compressor station to the marine loading arm , i.e. the connection device mentioned."

"Elering has built the gas infrastructure according to the connection application from the Finnish company FSRU Oy, and the dimensions which they provided. The connection device referred to is part of the terminal, which is included with the re-gasification vessel, since these are not universal [in their dimensions], but may vary from vessel to vessel," Ellermaa went on.

Veskimägi confirmed that the connection point was based on an international agreement referencing the technical parameters of a Finnish floating terminal.

"Elering never planned to build this connection point in such a way that this X is part of the connection point, it has been part ship, part floating terminal," he added.

An FSRU Alexela and Infortar are planning to use would require a different procurement than that set up this spring, at a time when it was hoped that an FSRU vessel would come to Paldiski, rather than to Inkoo, on the Finnish side of the gulf.

Further accession procedures are being conducted involving Alexela and Infortar at present, Veskimägi added.

The project was due for completion by the end of this month.

While the first FSRU vessel sailed for Finland, whose terminal at Inkoo also is not ready, rather than Estonia, the latter will be able to obtain gas from the former – though not via a preferential deal, as had been hoped.

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Editor: Andrew Whyte, Barbara Oja, Toomas Pott

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