PGNIG commences operations at Klaipeda LNG reloading station
On Wednesday, April 1st, the Polish oil and gas company PGNiG commences commercial operations at the KN-operated Klaipėda liquefied natural gas (LNG) reloading station. The capacities of the station, which will allow more efficient entry into the small-scale regional LNG market, is reserved for a strategic partner for five years.
One of the goals of KN‘s business strategy before 2030 is to achieve that the reloading station operated by KN would create value for the growing small-scale regional LNG market and operate profitably. According to Darius Šilenskis, CEO of KN, cooperation with PGNiG for at least five years is an important step towards this goal.
“We are positive that cooperation between KN and PGNiG will significantly contribute to strengthening of the regional small-scale LNG market. Together with our partners, we will strive to intensify its development, which will provide opportunities for more competitive prices and will enable LNG to be widely used by customers in Baltic States, North-Eastern Poland and Central and Eastern Europe,” emphasizes Darius Šilenskis.
Poland has a lot of potential for market development, as the LNG market is developing very fast in the country. There are currently 8 LNG refueling stations in Poland, two of which were opened earlier this year. The operation of such stations ensures access to LNG to heavy road transport. There is also a significant increase in the number of LNG regasification stations in off-grid locations.
“It is an important step in building PGNiG's position on foreign markets. I am convinced that PGNiG’s competence in small-scale LNG trading and operations will enable it to effectively develop the market for this fuel in Lithuania, Latvia and Estonia. We already supply our LNG to customers in Germany and the Czech Republic,” said Jerzy Kwieciński, CEO of Polskie Górnictwo Naftowe i Gazownictwo S.A. “The launch of operations by PGNiG in Klaipėda required making numerous complex trading and operating arrangements. I would like to thank the Management of KN for their full involvement in the process. It is the best guarantee of mutual benefits our Companies will obtain thanks to the cooperation we are initiating today,” the CEO added.
Positive momentum in the LNG small scale market is also noticeable in Lithuania. The National Energy and Climate Action Plan 2021-2030, approved at the end of last year, includes measures to promote the development of LNG refueling stations, support for the development of LNG-powered land and water transport, etc. The estimate of the 2020 Climate Change Programme for 2020, approved in March, already includes specific funds that amount to 35 million euros to subsidize the use of more sustainable fuels in national transport, from which 20 million euros are dedicated for public transport sector and 15 million euros for the purchase of the transport and development of the fuelling station network. It is noteworthy that LNG is the only feasible alternative to clean fuel in heavy road transport.
Compared to 2018 and 2019, the volume of loading handled at the LNG reloading station increased by 45 percent. During the two years of operation, 12 companies from Lithuania, Estonia and Poland used the LNG reloading station for filling of their LNG trucks. From the beginning of the operation of the reloading station, 44,000 cubic meters of LNG have been delivered to the LNG reloading station - 6 different small-scale gas carriers have delivered gas during this period.
A small-scale LNG terminal - KN reloading station, located near the gate of Klaipėda port, officially commenced its operations in October 2017. It consists of five tanks for liquefied natural gas, each with a capacity of 1,000 cubic metres. Up to two LNG trucks and a small volume LNG vessel can be filled at the same time at the LNG reloading station. Upon the commissioning of the KN LNG reloading station, together with the opportunities provided by the LNG terminal in Klaipėda, KN became one of the first companies in the world, providing all integrated LNG logistics services, thus consolidating the full LNG import value chain in the region.