State-owned Transmission Systems Operator firm Elering wants to take forced possession of a gas pipeline connection which forms a part of a Liquefied Natural Gas (LNG) terminal built last year at Paldiski.
The company which constructed the LNG quay, Pakreneeme Sadam, is asking for over half-a-million euros in rent per month, from Elering, in respect of the pipeline, which cost over €20 million to construct.
Pakrineeme Sadam, essentially a company operated by holding company Infortar and fuel retailer Alexela, has rationalized its demands on the basis that the pipeline is located on its land, Elering chief Taavi Veskimägi says, calling the development "incomprehensible."
Veskimägi said: "It is completely incomprehensible as to how private companies can demand rent for supporting Elering's gas infrastructure, located at the LNG quay, while at the same time wanting to connect to and use the infrastructure built by Elering for their own commercial purposes."
Since Elering does not want to pay that rent, it has already requested compulsory possession on its part, from local government, of the pipeline connection.
Veskimägi said this application went to Lääne-Harju Municipality at the end of December, in Elering's interests and in those of the state and the public.
Elering is also currently processing its application to connect to the gas network at the key, built by Alexela and Infortar, and awaits confirmation that a functioning LNG terminal which will be able to accommodate an FSRU – a vessel fitted out for the purpose of supplying LNG, which is then re-gassified on land – and then transmitted to the Estonian, Elering-operated gas network.
Since the infrastructure was built with public funds, it must be used, to avoid the occurrence of a "phantom connection," the Elering chief added.
Elering, Alexela and Infortar have failed to come to an agreement to on land use at the facility, despite negotiations which have gone on since, Elering says, springtime, in addition to a spat between Elering and the two other companies over whose responsibility procurement for equipment linking the FSRU to the connection point on land is.
Meanwhile, an LNG vessel which could in theory have docked off Paldiski has done so at Inkoo, Finland. This facility is connected by an undersea pipeline linking Finland and Estonia and set up just over three years ago by Elering and its Finnish counterpart, Gasgrid.
Lithuania also has a functioning LNG terminal at Klaipeda, which supplies Estonia too.
Russia's invasion of Ukraine concentrated minds on the situation regarding dependence on Russian natural gas. LNG producers include the U.S., Norway and Argentina.
Editor: Andrew Whyte, Marko Tooming