Grain LNG import terminal to expand

Thursday, 16 May 2019
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Grain LNG import terminal has announced that up to 8.3 mill tonnes per annum of redelivery capacity, 390,000 cu m of associated storage and over 100 berthing slots could be made available at the UK Isle of Grain terminal in 2025. 

The capacity offered is a combination of newbuild and existing capacity, which will come out of contract in 2025. The expansion will increase the size of the Grain terminal to around 1.2 mill cu m. 

Nicola Duffin, Grain LNG’s Commercial Manager, said: “Grain already has the largest storage tanks in Europe, which offer our customers the flexibility to store their LNG and optimise send out in response to market prices. With the expansion of Grain we will further optimise our existing assets, which means we’ll be able to be more competitive than typical newbuild capacity.

“We’re also ideally located in the South East of the UK, so tariffs to NBP are very favourable. Our customers benefit from the short haul tariff to the IUK and BBL interconnectors, allowing them to easily move gas to other European price hubs, such as TTF.

“We have two entry points to the NBP, a high-pressure entry point and a low- pressure entry point that offers our customers further savings on entry costs and a much lower minimum send out requirement compared to competitors,” she said.

Grain could also benefit from proposed changes to the gas specification rules in the UK, which would significantly reduce variable costs for LNG shippers. The UK’s Wobbe Limits currently require some sources of LNG to be blended with nitrogen to meet UK gas specifications.

Plans are underway to increase these limits, which could come into force by April, 2020 as part of the Gas Safety Management Regulations (GSMR). Proposals call for the limit to be changed to 52.85 MJ per cu m – a limit that would allow all but rich LNG to enter the grid without blending.

Duffin added: “LNG would be subject to lower processing and variable costs. Lower costs will make the UK a more attractive destination for LNG, which ultimately benefits UK energy consumers.”

Additional services available at Grain include reloads, transhipments and a multi-bay facility for reloading road tankers, and ISO containers. A marine breakbulk facility is planned for 2021/22 and it is the only UK terminal to offer small-scale solutions to the market.

UK terminals have seen a considerable increase in usage this winter as new global supplies have come online and the economics of moving LNG from the Atlantic to the Pacific basin have failed to add up. 

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