German town threatens legal action over fast-track LNG

(Reuters) - A German resort town on Friday said it will take legal action against the federal government's plans to build liquefied natural gas terminals off the Baltic Sea coast after the parliament passed a reform to speed up the process.

Germany started accelerating the construction of LNG infrastructure last year after the sudden drop in piped Russian gas imports to Europe's biggest economy that followed the Ukraine war.

Both houses of parliament on Friday backed the accelerated construction of two LNG floating terminals in Mukran on the Baltic Sea island of Ruegen, defying resistance from local governments and environmental groups concerned about the impact on tourism and marine life.

An application process for a project of that scale usually takes about six years. The fast-track process could cut the time to weeks or months, Ruegen Gegen LNG, a local initiative opposing the project, said.

"Our lawyer has been instructed to now obtain interim orders to stop construction at the Federal Administrative Court in Leipzig against the LNG terminals and the pipeline," Karsten Schneider, mayor of the town Binz, said.

Till Backhaus, climate minister in the state of Mecklenburg-Western Pomerania, which includes Ruegen, said the state did not support the project in its current form, and wanted hydrogen infrastructure to be added to the planned LNG facility.

LNG overcapacity, endangered marine life

With its beaches and white chalk cliffs, Ruegen is one of the top tourist attractions for Germans and only 35.6% of Germans supports building an LNG terminal there, with 49.6% against and 14.8% undecided, a survey by Civey showed in March.

Project developer Gascade applied for a 50-kilometre (31-mile) pipeline in several individual sections to mitigate the environmental impact, but the DUH environmental group said the terminal would be a catastrophe for marine life.

The two planned terminals in Ruegen will have an annual capacity of 10 billion cubic metres (bcm) to be operated privately by Deutsche Regas by the beginning of 2024.

Germany already has floating LNG terminals in operation at Wilhelmshaven, Brunsbuettel and Lubmin. Two of those sites will be expanded.

Capacity will also be increased through the replacement of some floating stations from 2026 with permanent terminals in Stade and Brunsbuettel and a privately operated one in Wilhelmshaven.

The initial cost of the infrastructure expansion, which will be paid by the government, was expected to be around 10 billion euros ($10.89 billion). The economy ministry in March said it expected the costs to be higher but did not specify how much.

Research has shown realizing all Germany's planned terminals would create over-capacity in excess of domestic demand.

A study by DIW economic research institute published in February said building permanent onshore LNG terminals ran counter to an expected future fall in natural gas consumption, given Germany's aim to become climate neutral by 2045.

The government says the terminals would ease pressure on other European ports and help to supply neighboring countries.

Economy Minister Robert Habeck on Friday said Germany needed to ensure security of supply and there would be more LNG plans.

"We're not done yet," Habeck she told the Bundestag, Germany's lower house.

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