European Commission approves Finland’s first LNG terminal

Plans for an LNG terminal at Pori on the west coast of Finland to be built with a €23 million grant have been approved by the European Commission. The Pori terminal will have a storage capacity of 30 000 m³, and aims to encourage ship owners to use LNG as a fuel. This, the Commission concluded, shows that the project is committed to environmental maintenance, the security of the Finnish gas supply and the continuation of competition in the Finnish LNG market. The European Commission’s approval of this plan can be seen as part of the European Union’s (EU) overall Energy Union strategy, which aims to end the energy isolation in the region surrounding the Baltic Sea, and to assimilate it into wider EU energy markets.

Margrethe Vestager, the EU Commissioner in charge of competition policy, said: “The LNG terminal in Pori is the first of its kind in Finland. It will provide a new source of cleaner fuel for the maritime industry and diversify Finland's gas supply sources. It is a good example of how EU state aid rules can encourage sound public investment that helps the EU reach its goals on energy security and environmental protection."

This LNG terminal will be the first of its kind in Finland. However, it will also be just one part of Finland’s wider aim of creating a network of small scale LNG terminals. Like the Pori terminal, these will all be planned with the goal of providing LNG infrastructure to the maritime industry.

Whilst the public funding (€23 441 500) will only cover less than 30% of the total investment, the developer and owner of the terminal will cover the rest of the cost. Public funding is required for the Pori LNG terminal because Finland does not currently have any LNG infrastructure, and so ship owners are hesitant to switch to LNG as a fuel. As a result, private investors have had no impetus to build LNG infrastructure because the demand is not there.

Edited from various sources by David Rowlands

Read the article online at: https://www.lngindustry.com/small-scale-lng/22092015/european-commission-approves-finlands-first-lng-terminal-1341/