Status: 10/18/2022 3:29 p.m
Dozens of ships with liquefied natural gas can apparently not be handled at the moment. Experts warn that LNG carriers could soon be looking for alternative ports outside of Europe.
More than 35 ships loaded with LNG are currently waiting for clearance off Spain and in the Mediterranean. That’s what traders, analysts and LNG terminal employees familiar with the situation said to the news agency Reuters. However, Spain is only offering six of the coveted slots at its terminals this week. The country has a total of six terminals.
Spain may have to reject LNG cargoes
The liquid gas can be pumped out of the transport ships at the plants, turned into a gas again by heating and then fed into the gas network.
In a statement on an “extraordinary operational situation” released late Monday evening, Spanish gas network operator Enagas stressed that it may have to reject LNG cargoes due to overcapacity. The high utilization is expected to last at least until the first week of November.
Speculation on even higher prices?
However, LNG ships are anchored not only off Spain, but also in the vicinity of other European countries. “We have seen large numbers of cargoes waiting off the coast of southern Spain or circling in the Mediterranean Sea,” said Alex Froley, LNG analyst at data analysis firm ICIS.
“Also some charges are holding out in front of the UK.” This may also be due to the fact that some ships are waiting to sell their cargo at a higher price before the start of the heating season.
Spain leads in LNG capacities
Spain is the number one LNG country in the European Union, as it has the largest regasification capacities: they account for a third of all LNG and 44 percent of the LNG storage capacity in the EU.
Germany, on the other hand, does not yet have its own LNG terminals. In the coming winter, two floating LNG plants in Wilhelmshaven and Brunsbüttel should be ready for use to import liquid gas into the German gas network.
Pipeline for LNG terminal Wilhelmshaven is on schedule
The pipeline for the import terminal for liquefied natural gas (LNG) in Wilhelmshaven is now half complete. The construction work for the Wilhelmshaven connection line (WAL), which is around 26 kilometers long, is on schedule, as the gas network operator Open Grid Europe (OGE) announced to the German Press Agency yesterday.
“We are on course with the construction of the WAL,” said project manager Franz-Josef Kissig. “Everyone involved in the project continues to work with concentration and motivation without interruption so that we can put the line into operation on December 20th.” According to earlier information from the state government, LNG is to be landed via the terminal from December 21st.
Together, the LNG terminals in Wilhelmshaven and Brunsbüttel have an annual capacity of up to 12.5 billion cubic meters. Two more of these systems could be used in Stade and Lubmin. The floating terminals could later be replaced by fixed ones.
Will France still agree to the MidCat pipeline?
The heads of state from France, Germany, Spain and Portugal plan to meet later this week to decide on Germany and Spain’s revived plans to build a gas pipeline called MidCat across the French Pyrenees.
The basic idea: Germany needs gas, Spain has more of it than it needs itself. The MidCat pipeline could help Europe further reduce its dependence on Russian gas, supporters say. Only France would still have to agree as a transit country. But the French have so far resisted it.