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Finland and Estonia agree on LNG Import Terminals projects

Gasum to build – operate Finngulf LNG Import Terminal

2B1st_Project_Smart_Explorer_Sales_Pursuit_ToolThe Finnish midstream company Gasum Oy (Gasum) will build and operate the Finngulf LNG Terminal project in order to import, store liquefied natural gas (LNG) in Finland in connection with the neighboring Estonia on the Gulf of Finland in the Baltic Sea.

Since 1860 Gasum is importing and distributing natural gas in Helsinki then in Finland for lighting, cooking and more recently as transportation fuel.

Finland-Estonia_LNG_Terminal_and_Balticonnector_MapFinland and Estonia do not have any natural gas resources but are surrounded by giant producers so that 100% of the gas consumed in these countries is currently imported from Russia.

These natural gas importation from Russia to Finland and Estonia are covered by long-term contracts.

In order to enforce these long term agreements, Gasum stakeholders are to date:

 – Finnish State 75% is the operator through its Gasonia Oy holding and National Emergency supply Agency 

 – Gazprom 25% as the gas supplier.

In the perspective of Finland willing to import LNG from western countries Helsinki Authorities proposed €510 million to Gazprom in order to acquire the 25% stake and take the entire control of Gasum.

On December 2014, Gazprom board is due to approve the transaction.

Despite the high cost of these equities, Finland is willing to take advantage of the declining prices of natural gas out of the western countries and to diversify its sources of supply.

Anyway the Finngulf LNG Import Terminal, the Estonia LNG Import Terminal and their inter connecting pipeline should be supported by EU financing.

Balticconnector to link Finland – Estonia LNG terminals 

From the total costs of the project estimated to $500 million capital expenditure, the interconnecting pipeline is evaluated to $200 million out of which 75% should be covered by the EU financing as a typical cross borders project in favor the European energy policy.

In this Finland – Estonia common project, Finngulf LNG project should be the main LNG Import Terminal, while Estonia LNG project should be much smaller.

Finland_Inkoo_Gasum_Finngulf-LNG-Import-Terminal_&_Balticonnector_ProjectThen the two Baltic LNG import terminals would be connected by the Balticconnector project, a subsea pipeline across the Gulf of Finland shallow water.

In Estonia the location selection of the LNG terminal is at feasibility study between Muuga Harbour and Paldiski South Harbour.

In Finland, Finngulf LNG Import Terminal project should be built near Inkoo (Inga)50 kilometers southwest if Helsinki.

Finland LNG terminal should have a capacity to import 10 to 20 TWh of natural gas equivalent representing from 25% to 50% of a year consumption.

Gasum is planning to build the Finngulf LNG Import Terminal project and the Balticconnector in different phases so that it could start receiving LNG carrier on early 2016 and reach the full completion by 2019.

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1 Comment to “Finland and Estonia agree on LNG Import Terminals projects”

  1. Does the above project call for bid openly for globe company or not?We are interest in this.

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