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Golar Power Limited to provide FSRU for LNG Croatia

November 9, 2018

LNG Croatia LLC officially closed the procurement procedure for the provision, operation and maintenance services of a Floating Storage & Regasification Unit (FSRU). During the process, bids from three different companies were received: Norwegian Golar Power Limited, Japanese Mitsui O.S.K. Lines and Greek Maran Gas Maritime Inc. After having evaluated the bids, Golar Power Limited was chosen for being “economically most advantageous”. The selected vessel has an LNG storage capacity of 140 000 m3 and a regasification capacity of 300 000 m3 of natural gas per hour, which amounts to a total annual capacity of 2.6 billion m3 of gas. Golar Power Limited offered a conversion of its existing LNG tanker (“Golar Viking”, built in 2005) to FSRU worth €159.6 million.

 

LNG Croatia now awaits the results of the Open Season procedure. After the deadline on December 20th, overall booked capacity will be determined and a decision will be made whether to proceed with the project. Subject to a positive investment decision, LNG Croatia plans to acquire the FSRU between 30th September 2020 and 30th October 2020 in order for the unit to start operation at the begining of 2021.

 

On the other hand, after a period of low rental prices for LNG tankers, a steady growth is recorded with prices reaching over €170 000 per day. These prices are four times higher than average prices recorded in 2017 and six times higher than average rental prices in 2016. Key factors influencing LNG price peaks is the rapid growth of Chinese LNG imports and a considerable distance between exporters and importers on the global market.

 

According to a recent report by the Agency for the Cooperation of Energy Regulators (ACER) on wholesale gas prices in Europe in 2017, Croatia is currently paying the third most expensive gas in Europe. The report provides an overview of the price of imported natural gas, as well as the average price on gas exchanges. According to ACER data, during 2017, Croatia paid an average price of 21 €/MWh. This is a wholesale price of imported gas 17% to 23% higher than the prices in countries of the surrounding region.

 

Source: LNG Croatia

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