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Gulf of Finland LNG terminal denied EC investment

LNG Industry,

Gasum Corporation and Alexela Energy have concluded their studies on alternative collaboration models concerning the LNG import terminal planned for the Gulf of Finland, at the request of the European Commission.

In the studies conducted, no commercially viable collaboration model could be found for a terminal at the level of the investment aid indicated by the European Commission.

Feasibility studies

In February, on the request of the Commission, Gasum and Alexela signed a Memorandum of Understanding on further feasibility studies concerning the regional LNG terminal project in order to map out possible modes of collaboration by the end of May.

The companies presented their plans in June, however the European Commission did not find them viable for investment aid. Consequently, the parties have at the European Commission's request designed several alternative collaboration models for the implementation of the import terminal.

Commercially viable?

During the negotiations it emerged that the amount of EU investment aid available for the terminal is significantly smaller than had previously been known. The companies have evaluated several different options concerning a variety of collaboration models, however none of these proved to be commercially viable at the support levels indicated by the European Commission.

“The negotiations were conducted in good spirit, but unfortunately we were unable to reach a financially viable solution with the level of EU investment aid available. To be realised, all of the presented models would have required significant EU investment aid, which was not available,” explained Gasum CEO, Johanna Lamminen.

LNG in Finland

Gasum will now continue to further its own terminal project independently. The final location of the terminal, the amount of investment and the scheduling will be revised in the development work.

Lamminen concluded: “There is a need for an import terminal in Southern Finland to ensure and diversify our customers' access to LNG in this region for shipping and industry alike. Once completed, the terminal would also enable alternative sourcing for pipeline gas.”

Adapted from press release by Katie Woodward

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