LNG

Enagás, the Spanish natural gas operator of six large LNG terminals and with gas assets in other European countries and overseas, has reported a surge in customers for its LNG bunkering services along the Spanish coastline and even more fuel will be supplied in 2024 as bunkering vessels arrive on station.

Italian utility Edison and Enagás, the Spanish natural gas grid operator and LNG terminal network owner, have delivered the first cargo to their small-scale LNG import terminal joint venture at the port of Ravenna on the northeast coast of Italy.

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.

Spanish LNG terminal owner and network operator Enagás said the keel-laying had taken place of the first liquefied natural gas bunkering vessel to be built in a Spanish shipyard.

The construction is taking place at the Armon Shipyard in the northwest Spanish port of Gijón. The yard was founded in 1963 and is now one of the leading private shipbuilders in the European Union.

“Once operational, the ship will use the Enagás LNG terminal in the Port of Barcelona for the loading and subsequent supply of LNG to ships that berth in the port or make stops to refuel before continuing their route,” explained Enagás

The formal keel-laying ceremony took place at the yard, attended by executives involved in the project, including the Enagás subsidiary Scale Gas and Knutsen OAS Shipping, the Norwegian fleet operator and owner of the bunkering newbuild.

The ship will have an LNG storage capacity of 5,000 cubic metres, be 92.75 metres in length with a beam of 16.90 metres and draught of 4.25 metres.

The vessel will itself be powered by LNG fuel and will comply with all safety measures, as established by the different regulations.

The project is also being supported by the Port of Barcelona, which is keen to be part of the Mediterranean LNG fuel hub for shipping.

“The bunkering initiative is framed within the European Union's funding programme for transport, Connecting Europe Facility (CEF), which has approved €9 million ($10.7M) for its implementation,” said Enagás.

While Knutsen will own the vessel and Enagás will host the ship at the Barcelona terminal, the supply of the LNG for bunkering will be guaranteed by Shell Spain.

“Shell plans to double its existing LNG bunkering infrastructure on key international trade routes by the mid-2020s and this vessel will play an important role in that journey,” explained Enagás.

Enagás noted that Shell completed the first LNG ship-to-ship bunkering in Barcelona in 2019 and said it was looking forward to working with the partners on this project.

“In addition to promoting more sustainable maritime transport and improving air quality in the city of Barcelona, this project will be a further step to consolidate Spain and the Port of Barcelona as European LNG bunkering locations,” stated Enagás.