LNG

Enagás, the Spanish natural gas operator of six large LNG terminals and with gas assets in other European countries, has successfully sold €600 million of bonds as it also allocated half of its available regasification capacity for the next 15 years.

The Enagás 10-year bonds will mature in 2034 and have an annual coupon of 3.625 percent.

The bonds had five-times more offers to buy than the issuance required.

“Although the company does not have relevant maturities until the end of the year, it has taken advantage of the good market conditions at the beginning of the year to carry out this issue, extend the average life of its debt and thus have part of the upcoming maturities covered,” the Madrid-based company explained.

“The success of the placement, both in term and in financing cost, contributes to improving the good financial situation of the company, which has diversified financing sources,” it added.

Slot allocations

Spain’s Enagas said that its recent LNG allocation represented nearly all of the slots it had offered to date, reinforcing Spain’s status as key hub for LNG imports in Europe.

The prominence of the Spanish in the LNG sector is further highlighted by the fact that its regasification terminals accounted for almost one-third of LNG storage in Europe as of mid-January 2024.

Enagás also started up the El Musel LNG trans-shipment terminal in 2023 in the Port of Gijón in northwest Spain to supply other EU nations and assigned its logistics services to the European utility Endesa.

The grid company owns five large Spanish terminals at Barcelona in the northeast, at Cartagena in the southeast, at Sagunto in the east of Spain, at Huelva in the southwest and the El Musel facility.

Enagás additionally holds a 50 percent stake at another northwest facility serving the northwest port of Bilbao and owns two small regasification terminals in the Canary Islands.

Spain’s storage levels are still at around 85 percent filled and the LNG is supplemented by pipeline gas supplies from Algeria.

Other stakes

Enagás in July 2023 closed an agreement to acquire an additional 4 percent stake in the Trans-Adriatic Pipeline (TAP), taking its stake in the pipeline bringing Azerbaijan gas to Europe up to 20 percent.

In other LNG activities outside of Spain, Enagás became an industrial partner with a 10 percent stake in the Hanseatic Energy Hub consortium planning an onshore LNG import terminal at the German North Sea port of Stade.

Enagás, the Spanish gas grid and terminals operator, increased profits in the first six months of 2023 helped by one-time items as LNG activities increased to help the European Union’s natural gas shortfall and the utility also boosted future capacity on the Trans-Adriatic Pipeline from Azerbaijan.

The company’s net profits jumped to €172.8M including a net gain of €42.2M from the sale of a stake in the Morelos Pipeline in Mexico and an €133.8M adjustment relating to the Tallgrass Energy operations in the US.

“The Spanish Gas System operated 100 percent availability, Spain increased its total gas exports by 55 percent in the first half of the year and ship reloading has increased by 67 percent, contributing to Europe's security of supply,” Enagás stated.

Italy was a main destination for LNG re-exports to Europe while pipeline gas connections increased by 33 percent to 28.6 terawatt hours. The company already trans-ships LNG to the EU from terminals like Barcelona.

“Spain's underground natural gas storage facilities are at 98 percent capacity, an all-time high for the month of July,” it added.

Revenues up

The Madrid-based company reported first-half revenues of €450.5M, a drop of 5.8 percent from €472.2M registered in the first six months of 2022.

Enagás said it was still on track to meet the full-year earnings target of between €310M and €320M.

Enagás added that in July it closed the agreement announced in January to acquire an additional 4 percent stake from European trader AXPO in the Trans-Adriatic Pipeline (TAP) for €168M, taking its stake in the pipeline bringing Azerbaijan gas to Europe up to 20 percent.

During the first half, Enagás contracted additional transport capacity of 1.2 billion cubic metres from TAP, in addition to the current 10 Bcm starting in 2026.

During an eventful first half, Enagás noted the start-up of the El Musel LNG trans-shipment terminal in the Port of Gijón in northwest Spain and the assignment of its logistics services to the European utility Endesa.

“The terminal has already received two LNG shipments and will start commercial operation on July 31 after a capacity allocation process that has aroused great interest,” the company added.

Another highlight was the agreement with regional gas company Reganosa through which Enagás acquired its 130-kilometres of strategic gas pipelines in northern Spain and Reganosa agreed to purchase a 25 percent stake in the El Musel regasification terminal.

“The closing of the deal was expected in the second half of this year,” said the company.

In LNG activities outside of Spain, Enagás became an industrial partner with a 10 percent stake in the Hanseatic Energy Hub consortium planning an onshore LNG import terminal at the German North Sea port of Stade.

Enagás, the Spanish gas grid and terminals operator, said the El Musel liquefied natural gas re-loading facility in Northwest Spain designated to supply the European Union has awarded the services contracts to utility Endesa after a tender process.

Endesa is the largest Spanish electric utility while being a majority-owned subsidiary of the Italian utility group Enel.

Enagás said the award to Endesa of logistics services for the El Musel terminal at the Port of Gijón on the Bay of Biscay followed a capacity allocation process.

“The open season had aroused strong interest among trading companies. In total, 13 were received between June 5 and 30, the period during which this last part of the process was developed,” explained Enagás.

“The logistics services offered for this infrastructure are LNG unloading, storage and loading operations,” Enagás said.

Regulated régime

“Within the regulated access regime, the El Musel plant contemplates a minimum regasification for the exact management of the terminal, as well as the tanker-loading service,” it added.

Enagás has re-activated the existing El Musel terminal to meet growing LNG needs in the EU after the closure of Russian pipeline gas supplies and a US commissioning cargo was delivered recently by the 174,000 cubic metres capacity carrier “Cool Racer”.

The Spanish terminal will contribute up to 8 billion cubic metres of additional LNG to Europe’s supply when commercial operations start.

El Musel will specialise in the unloading of LNG carriers from various producing countries and the rapid re-loading of ships for different European destinations.

The terminal berthing can accommodate the largest vessels and it has two storage tanks each with capacity of 150,000 cubic metres.

The re-opening of El Musel is part of the Spanish Government’s “More Energy Security Plan” and will add to Spain’s role as an energy hub for Europe as the nation also receives pipeline gas imports from Algeria.

Enagás operates six other LNG regasification terminals on mainland Spain.

Enagás, the Spanish gas grid and LNG terminals operator, has held an event for marketers and the regulatory authorities at its headquarters in Madrid where it revealed plans to launch an open season on March 6 for logistics services at the re-activated El Musel import terminal in Northwest Spain on the Bay of Biscay.