Port of Gothenburg Anticipates Marine LNG Fuel Demand

| Sweden, Gothenburg

Planning of the new terminal for liquefied natural gas (LNG) at the Port of Gothenburg is in full flow. During the summer, Vopak LNG, a specialist in the storage of liquefied natural gas and subsidiary of Royal Vopak, and Swedegas AB, owner of the gas grid which extends from Dragör in Denmark to Stenungsund in Sweden, signed an agreement which now also has been signed by the Port of Gothenburg. The three parties are now turning their attention to the marine fuel market to investigate the level of interest in LNG.

Stricter sulphur emission stipulations mean that ships operating in Swedish waters must switch to a more eco-friendly fuel by 2015 at the latest. Likewise, an increasing number of Swedish companies are looking to switch from oil and coal to cleaner alternatives. In both cases, LNG is the form of energy that is in greatest demand, say Port authorities.

At present, it is difficult for shipping and industry to source LNG in sufficient quantities. A new investment in an LNG terminal at the Port of Gothenburg could be the solution. A survey is currently being conducted to determine market wishes and requirements.

Environmental benefits appeal to the market

“The environmental benefits of LNG have generated demand not only in shipping but also in industry. At present, we are scanning the market to ensure we dimension the terminal properly and offer the right services,” explains Lars Gustafsson, President of Swedegas, who’s company is currently investing in the development of an infrastructure for biogas and LNG.

The terminal is planned to be completed in 2015 to satisfy the need in the shipping sector for a fuel with no sulphur or particle emissions. In industry, there is growing realisation of the potential to achieve environmental objectives more rapidly by replacing oil and coal with natural gas. Carbon dioxide emissions would be reduced by 25-40 per cent and emissions of sulphur and particles would be reduced to zero.

First terminal with unrestricted competition

The LNG Terminal in Gothenburg will be the first in the country to be built according to the ‘open access’ principle. Any company interested in importing gas to the Swedish market will now have the opportunity to reserve capacity.

“Unrestricted competition is crucial if the end-customer is to be able purchase gas at the best price on the world market,” states Lars Gustafsson.

Strategic location

Locating the terminal in Gothenburg is a strategic decision:

“The port of Gothenburg is not only the largest port in the Nordic region but also the foremost energy port. We want to put across a clear message to the shipping industry that LNG will be available when stricter environmental stipulations come into force,” says Magnus Kårestedt, Port of Gothenburg Chief Executive.

The Port of Gothenburg says it will be among the first of the major ports in the world where vessels that need to bunker will not need to enter a special terminal. Bunkering can take place exactly as it does at present – directly from a bunker tanker while the vessel is being loaded and unloaded. This will open up the potential for large-scale LNG bunkering.

The Port is the largest port in the Nordic region with 11,000 calls by vessels each year. Gothenburg is a hub for onward transport of LNG by rail or road to various parts of the country. The terminal will also be connected to the gas grid.

(This article compiled using information from a Port of Gothenburg press release)

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