Excelerate's Teesport LNG seen having no cargoes

Thursday, 21 June 2007

Currently projected US natural gas prices for the coming winter are so much higher than those in the UK that latest predictions are that the Excelerate project could import no cargoes at all into the UK.

"Under these (price) conditions, the US could be expected to attract some or many of the cargoes that could have been expected for the UK," said the report supported by the UK regulator.

For this reason, the UK's National Grid is assuming no LNG flows through Teesport, though acknowledges "there could be an upside."

Excelerate brought its one and only ever LNG cargo into Teesport on February 19 this year and that was for commissioning purposes.

The "Excelsior" LNG carrier docked alongside a dedicated jetty where it connected to the onshore facility that feeds into the UK natural gas grid - the National Transmission System (NTS).

While the technology worked perfectly the transatlantic natural gas price differential has made it uneconomic for Excelere to import LNG.

The total cost of the Teesport project was less than $80M compared with more than $500M for a conventional land-based facility.