LNG

Enagás, the Spanish gas grid and liquefied natural gas terminal network operator, and maritime fuels company Peninsula Petroleum Ltd, have signed a joint venture deal for the building and charter of an LNG bunkering vessel based at the Port of Algeciras to serve the Strait of Gibraltar shipping lanes.

The bunkering vessel with capacity of 12,500 cubic metres will be built at the South Korean Hyundai Mipo Dockyard shipyard and is expected to be delivered in the third quarter of 2023.

The vessel will be chartered by Peninsula through an initial seven-year contract. It will load LNG fuel at Enagás regasification terminals, mainly the one at Huelva in southwest Spain.

The Enagás subsidiary called Scale Gas signed the agreement with Peninsula.

The LNG bunkering project will be co-financed by the European Union to the tune of €11 million ($13.3M) as part of the EU Connecting Europe Facility (CEF) transport aid programme.

The financing is available as part of the EU’s support of the development of LNG as a maritime fuel to help avoid sea pollution and to improve air quality in ports.

“The signing of this agreement is in line with Enagás’s commitment to promoting the development of a value chain that allows more efficient and sustainable maritime transport,” said Marcelino Oreja, Chief Executive of Enagás .

John A. Bassadone, the CEO and founder of Peninsula, said the project would serve a growing market and promote cleaner fuel.

“Peninsula and Enagás share the vision of developing the use of LNG as a transitional maritime fuel,” explained Bassadone.

“Having the support of a partner like Enagás is incredibly positive and exciting,” he stated.

Also party to the agreement is the Spanish Port Authority of Algeciras.

“We have been working intensely to promote alternatives to current fuels and developing the use of LNG as a proven technology that is currently available to serve ship owners already asking for LNG in the Port of Algeciras,” said Gerardo Landaluce, President of the Algeciras Port Authority

“Two years after the signing of this agreement, supported by Enagás and along with the co-financing of the European Union, the Bay of Algeciras will have a stable LNG bunkering supply service,” added Landaluce.

Endesa, the largest power company in Spain and the second-largest natural gas operator, has launched a project to expand its port terminal in Los Barrios in the Port of Algeciras to capture the liquefied natural gas bunkering business around Cádiz and in the Strait of Gibraltar.

Supplies of liquefied natural gas as a maritime fuel for vessels passing the Strait of Gibraltar and the development of infrastructure were considered at a European Union-backed meeting at the Spanish port of Algeciras.