Nordic LNG supplier Skangas has signed a letter of intent with National Grid to source liquefied natural gas at the Grain LNG import terminal in the UK.
According to Skangas, with this deal, the LNG company becomes the first small-scale LNG supplier to enter into such an agreement with a UK-based import terminal.
Grain LNG, which operates primarily as a large-scale import terminal, is developing an LNG break bulk marine facility to make it possible for small vessels to reload and bunker the chilled fuel.
It is set to become the first facility in the UK to offer small-scale ship reloading facilities at its import terminal on the Isle of Grain.
“We believe the best way to encourage growth in the market is to offer competitive alternatives which ensure security of supply for small scale market participants,” said Nicola Duffin, Senior Commercial Manager at Grain LNG.
The facility will include an extension to existing jetties to cater for break bulk marine LNG carriers up to 20,000-cbm. This will meet the needs of Skangas’ fleet of LNG carriers.
“This (agreement) will improve supply to the small scale markets thus allowing to source LNG on more flexible and competitive terms. In the end, it will be reflected in improved offerings to our own LNG customers,” said Dan Hramoff, Director of Business Development and Projects at Skangas.
Skangas, a unit of Gasum, produces LNG at its plant in Risavika, south-western Norway.
However, the small-scale market is rapidly developing, and the plant’s annual production capacity of 300,000 tons has already been exceeded.
The company requires external LNG sources, and has entered into several contracts with similar large-scale European hubs to source LNG.