LNG

The US Department of Energy published its latest LNG export data with France, Spain, the Netherlands, the UK and South Korea and Japan being the main destinations while prices for that period began to rise and shipments from Calcasieu Pass were the most expensive.

Denmark has become a benchmark nation for measuring pipeline natural gas and power needs in the European Union as a bridge supplier of gas to Poland on the Baltic Pipe and being outside the LNG supply loop unlike Germany.

The European Commission is paying Poland €3.85 billion ($4.04Bln) to support the initial aftermath of the shutdown of coal mines in five Polish regions as the nation increases LNG and pipeline natural gas imports as well as developming renewable energy sources.

Höegh LNG Holdings, the owner of 10 floating storage and regasification units (FSRUs) and two conventional carriers, posted a quarterly loss because of operational issues and ships being out of contract ahead of being re-deployed.

Höegh reported a net third-quarter loss of $45.9 million, which was wider than the $3.14M loss posted in the same three months of 2021.

The Bermuda-based company, now owned by Norwegian interests and US equity funds managed by US bank Morgan Stanley, reported higher third-quarter revenues of  $96.09M versus $86.15M in the same quarter of 2021.

“The fleet delivered a stable operating performance in the third quarter,” said Höegh.

“However, the ‘Höegh Giant’ has been idle since late April following the termination of its FSRU contract and the ‘Höegh Gannet’ was idle for a period towards the end of the third quarter while repositioning to a yard for class renewal and modifications to be carried out in the fourth quarter to prepare the vessel for FSRU operations,” explained the company.

“Furthermore, ‘Neptune’ was out of service for a period in the third quarter for regular class renewal and maintenance,” it added.

Höegh said the following the surge in demand for FSRUs earlier this year, the company has secured long-term FSRU employment for its entire fleet.

Lithuania FSRU

Additionally, the Lithuanian charterer of the vessel “Independence” has declared the purchase option to acquire the FSRU in December 2024.

The FSRU has been in operation at the Baltic port of Klaipeda since October 2014 for a charter cost of around $68 million per annum.

The charterer of the “Independence” is the energy storage company Klaipėdos Nafta.

Höegh said that its main business focus now was to prepare its FSRU fleet for the start-up of the new contracts and to ensure the projects are delivered on time, except for the potential later start of the contract in Australia.

The company added that it had settled the differences of the cancellation of an FSRU deployment on the West Coast of India.

“Following Höegh’s termination of the ‘Höegh Giant’ FSRU contract in India in April, Höegh reached an agreement with the previous charterer (H-Energy) in July dropping all claims and counterclaims against a settlement amount to be paid by Höegh and the ‘Höegh Giant’ thereafter left India,” it explained.

“The vessel was modified and prepared for FSRU operations at a yard during October-November, and will be allocated to one of the group’s new FSRU contracts,” stated Höegh.

The company said that it was also still involved in pending arbitration with the charterer of “PGN FSRU Lampung”, the FSRU deployed in Indonesia.

Outlook

Höegh said in its outlook for the coming year that the company’s main operational focus was to prepare the FSRUs for start-up of their new contracts.

“Looking further ahead, the company will start considering potential growth opportunities including expansions of its FSRU fleet with newbuilds, or the conversion of LNG carriers to FSRUs to meet the increased demand for FSRUs,” it stated.

The group expects that the results for the fourth quarter of 2022 will be impacted by three FSRUs being out of service for modifications.

“The three FSRUs will be without revenue for a period, and costs involved with the modifications may be partly expensed as operating expenses and partly capitalized as investments depending on the nature of the costs incurred,” added Höegh.

The LNG shipping company, one of the sector’s pioneers, completed its own overhaul in 2022 with a merger and is owned by Larus Holding Limited, a 50-50 joint venture between Norway’s Leif Höegh & Co. Ltd. and US equity funds managed by Morgan Stanley Infrastructure Partners.

The Baltic state of Lithuania has allocated the long-term capacity on a regional basis for the floating liquefied natural gas import facility at the port of Klaipėda.

Polish state-owned oil and gas developer PGNiG Group posted revenue of PLN78.37 bill, up 214% year-on-year for the first six months of this year. 

The first cargo to leave the Hammerfest liquefaction and export plant in northern Norway since the September 2020 fire is on its way to re-connecting the Norwegian seaborne gas supply chain for the European Union.

May 25 (LNGJ) - Klaipėdos Nafta, the Baltic oil storage company and operator of the Lithuanian LNG import terminal, the floating storage and regasification unit (FSRU), the “Independence”, has completed the annual LNG terminal capacity allocation for the final quarter of 2022. “Five customers will use the booked 9.66 terawatt hours TWh of LNG capacity,” said Klaipėdos Nafta. The fourth-quarter deliveries will amount to about 10 cargoes.

   “The capacity was allocated proportionally, giving priority to companies that have used the services of the terminal in the last three years,” explained Jurgita Silinskaite-Vensloviene, Head of KN LNG Commerce. “Five companies from Lithuania, Estonia and Poland have been awarded capacity for LNG carriers carrying at least 138,000 cubic metres of cargo,” she added.

Lithuanian fuel company Klaipedos Nafta has invited market participants to book regasification and cargo capacities for the first three months of the coming winter season from October to the end of December 2022.

The Baltic nation’s operator of oil and gas and fuel storage at the Lithuanian port of Klaipeda said the floating LNG terminal would offer a total of 9.66 terawatt hours during the allocation procedure.

The Baltic states of Lithuania, Estonia and Latvia have only one import terminal between them at the Lithuanian port in the form of the 170,000 cubic metres capacity floating storage and regasification unit (FSRU) “Independence”, delivered in 2014 by Norway’s Höegh LNG Holdings.

Höegh LNG has since expressed its intention to sell the FSRU “Independence” to a suitable buyer as Höegh itself was subjected to a corporate overhaul after an internal takeover.

“In order to ensure that the services of the terminal can be used by as many customers as possible, the capacity of the LNG terminal will be allocated,” said Klaipedos Nafta.

The company said that new regulations provide that a single terminal user may not book more than half of the terminal's allocated capacity.

Preferences

“In the event that the supply of terminal capacity exceeds the demand, the capacity shall be allocated on a ‘pro rata’ basis, with preference given to the companies, which have used the services of the LNG terminal in the last three years and are therefore familiar with the operating principles,” explained Klaipedos Nafta.

Later in 2022, Klaipedos Nafta also stated that it planned to offer the market the possibility to book long-term capacity at the LNG terminal from January 2023 for a period of five or 10 years.

The relevant amendments to the regulations for the use of the terminal have been submitted for market consultation.

“One of the technical changes we will follow next year will align the so-called gas year with the calendar year,” explained Jurgita Šilinskaitė-Venslovienė, Head of LNG at Klaipedos Nafta.

“That is why we are currently initiating capacity allocation for a relatively short period of three months,” she added.

“Already in June, we will invite customers to assess the long-term capacity needs of the LNG terminal, for which we are currently making the final preparations,” she concluded.

The Klaipedos Nafta said applications for terminal capacity scan be submitted to the company until the 17th of May at 4:30 PM Lithuanian time.

Joint annual and monthly schedules of LNG cargoes delivered to the terminal will continue to be published and updated on the Klaipedos Nafta website.

“For the gas year, lasting from 1 October 2021 to 30 September 2022, customers have booked a total of 23.9 TWh of Klaipeda terminal capacity,” it added. 

The European Union and Japan said after meetings in Brussels that they were committed to work closely to address the current challenges in energy markets worldwide, including LNG and pipeline natural gas supplies.