HomeNewsFinland's floating LNG terminal to receive first commercial cargo

Finland's floating LNG terminal to receive first commercial cargo

3/31/2023

(Reuters) - Finland is set to receive the first commercial delivery of liquefied natural gas (LNG) to the Inkoo floating terminal set up to replace Russian gas supply after the start of the war in Ukraine.

The Vivit Americas LNG tanker, carrying a cargo loaded in the United States, is set to arrive at Inkoo on Sunday, Refinitiv Eikon shipping data shows.

It will be the first full delivery since the floating storage and regasification (FSRU) vessel Exemplar was installed at the end of last year. One other tanker, the Isabella, delivered a partial cargo during the commissioning process.

Finland has agreed a 10-year charter for the vessel that will serve both its domestic and Baltic market after Russia stopped all exports of gas over disputes sparked by its invasion of Ukraine.

Operator Gasgrid initially offered 14 arrival slots for the second and third quarter but has since reduced that to 10, citing expected market demand and constraints on the gas pipeline connecting Finland and Estonia.

Eesti Gas is the only company to have booked capacity at Inkoo to date.

Gas prices in Europe spiked to more than 340 euros per megawatt hour (MWh) last August, after Russia cut supplies of relatively cheap pipeline gas, but have since dropped to about 45 euros/MWh.

To address the change in market demand, the FSRU operator is considering the introduction of reloading services, whereby LNG is stored briefly and then reloaded onto another vessel, it said this month.

"With the changed circumstances, it has become clear that offering a reloading service would significantly improve the utilization rate of the LNG terminal ship, thus increasing its economic operating conditions," Gasgrid said.

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