Poland receives LNG terminal bids

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Feb. 11 -- Poland’s state-owned Polskie LNG received bids from three consortia to build a LNG terminal at Swinoujscie in the northwest part of the country.

Members of the consortia include Italy's Saipem SPA with Poland's PBG; Italy's Tecnimont SPA with Poland's Polimex-Mostostal SA and France's Sofregaz SA; and South Korea's Daewoo Engineering & Construction Co. with Korea Gas Corp.

Polskie LNG will negotiate with each of the consortia until April. In May, the terminal operator plans to finalize the engineering, procurement, and construction contract, enabling building to begin in this year’s second half.

The Swinoujscie terminal, estimated to cost €600-700 million, will have a capacity of 5 billion cu m/year of gas, which may be expanded to 7.5 billion cu m/year, depending on demand growth in Poland.

If utilized at full capacity in 2014, the terminal would supply 30% of Poland's total gas demand, which is forecast to rise to 16.4 billion cu m by 2014, according to analyst BMI.

Polskie LNG Pres. Zbigniew Rapciak said the proposed LNG terminal will begin operations on June 30, 2014, an adjustment of previous forecasts that had put the start of operations at yearend 2013 or early 2014.

The delayed start date would not be a problem for Poland's state-owned PGNiG, according to a Polskie LNG spokesperson, who added that the first carrier from Qatar is not due to moor at Swinoujscie until July 2014.

Last April, PGNiG signed a 20-year agreement with Qatargas to receive 1.5 billion cu m/year of LNG, and the Swinoujscie terminal will have a 315-m dock capable of berthing Q-Flex LNG tankers, Qatar’s largest (OGJ Online, Apr. 16, 2009).

A total of six Q-flex LNG carriers are expected to make 11-12 deliveries of up to 217,000 cu m each year to Swinoujscie, but the Poles still plan to diversify their suppliers so that the Qatari contract can be supplemented with medium-term or spot LNG contracts.

Meanwhile, according to state media, Poland’s Council of Ministers is thought likely to approve a conditional agreement reached by PGNiG and OAO Gazprom. The biggest concern involves extension of the import contract by 15 years to 2037 and increasing the gas supply by 2.3 billion cu m.

However, industry experts say Poland will need extra gas from Russia this year and in the near future, at least until the opening of the Swinoujscie LNG terminal.

Contact Eric Watkins at hippalus@yahoo.com.

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