LNG

Fluxys of Belgium plans to install four additional LNG truck-loading bays at the Zeebrugge import terminal as LNG demand continues to grow as a fuel replacement for diesel in northwest Europe and all around the European Union.

Zeebrugge has been in operation since 1987 and has five tanks with 566,000 cubic metres capacity of storage and a nominal 6.6 million tonnes per annum of unloading. 

“With demand for LNG as a low-emission fuel soaring, the existing truck-loading bays at the Zeebrugge LNG terminal are gradually being used at their maximum capacity,” said Fluxys.

“While the number of truck-loadings in 2017 was still around 1,450, the utilization rate for this year is estimated to rise towards 6,000 loadings, approaching the maximum capacity of 8,000,” added the company.

The Fluxys operations at Zeebrugge have also grown in importance since the start of the long-term trans-shipment contract in 2019 for Yamal LNG in Russia. The Yamal cargoes pushed shipping traffic at the Zeebrugge terminal to new heights in 2020.

A total of 172 vessels docked at the terminal, smashing the previous record of 130 in 2019.

Fluxys said that March 2020 was the busiest ever month for ship traffic at the terminal, with a total of 30 vessels docking, more than double the previous record in May 2019.
At the same time, LNG truck traffic increased by over 20 percent.

“A market interest inquiry into truck-loading slots at the Zeebrugge terminal held in mid-2020 showed strong demand for booking substantially more slots in the future,” explained Fluxys.

“With the additional truck loading bays, the market will continue to be able to count on sufficient loading capacity to meet increasing demand. The four new truck-loading bays are scheduled to become available in 2024,” stated Fluxys.

LNG trailers mainly load LNG at the Zeebrugge terminal to supply fuelling stations servicing LNG-powered trucks.

The trailers loaded at the terminal also supply LNG-powered ships and remote industrial users without connection to the gas grid.

Another option is loading LNG containers for onward intermodal transport by train or ship.

“The key demand driver for substantially more truck-loading slots at Zeebrugge is the fast-growing fleet of LNG-powered trucks and the equally strong rise in fuelling stations to service them,” noted Fluxys.

On the shipping side, Fluxys in February 2021 reached a final investment decision to build 6 MTPA of additional regasification capacity at Zeebrugge.

A total of 4.7 MTPA will be completed by early 2024 and the remainder by 2026, adding to the 6 MTPA capacity available.

The Belgian Federal Commission for Electricity and Gas Regulation has approved the tariff and liquefied natural gas services agreement proposals for unloading slots and additional storage services at the Zeebrugge LNG import terminal.

The regulatory approval clears the way for Fluxys LNG to finalise new long-term contracts for the facility up to 2044.

“The approval allows us to turn binding interest from the market into new long-term contracts worth roughly 1 billion euros,” said Pascal De Buck, Chief Executive and Chairman of Fluxys Belgium, the transmission network operator.

The director of the regulatory Commission, Laurent Jacquet, said the tariffs have decreased for all terminal users who unload and store LNG, and inject natural gas into the transmission system.

“Through the new tariffs, the Commission has established a solid and stable framework for regulatory supervision in the future,” explained Jacquet.

“These favourable conditions consolidate Zeebrugge's position as an access point for LNG deliveries to Europe,” he added.

Fluxys said that the current long-term contracts for unloading at the Zeebrugge terminal expire in 2028.

During a subscription window held from 30 April until May 24 unloading slots and additional storage services at the Zeebrugge facility were offered over subsequent periods up to 2044.

“The subscription window proved highly successful and revealed binding interest from the market for the entire unloading capacity at the facility up to 2044,” stated Fluxys.

Fluxys and the regulator noted that the positive outcome of the subscription window process was the result of a combination of factors.

“Gas import needs in Northwest Europe are set to rise significantly,” they said.

“Gas production in The Netherlands and the North Sea is declining, while gas demand for power generation will increase to accommodate the phase-out of sizeable coal, lignite and nuclear power generation capacity in the region,” they added.

Fluxys stated that the subscription window offered an attractive tariff proposition together with optimum destination flexibility throughout Northwest Europe from a strategically positioned LNG terminal.

Zeebrugge is directly linked into the Belgian market (ZTP) and is fully interconnected with the gas systems of all surrounding markets.

These include the Dutch Title Transfer Facility (TTF) the German Gaspool, the Trading Region France (TRF) market and the UK National Balancing Point (NBP) and take-away capacity from the terminal is readily available.