Lithuanian KN has new long-term strategy focused on energy transformation and climate neutrality
Lithuanian LNG terminal operator Klaipedos Nafta (KN) has introduced its new corporate strategy for the period 2023-2050 which is centred around the efficiency of current activities, preparation for the energy transformation and transition towards activities in the new energy field.
The strategy, which has been approved by the Supervisory Council of KN, takes effect on 14 June.
With this strategy, KN aims to achieve complete climate neutrality for its operations by 2050, with a target of reducing emissions by over 30% by 2030 and approximately 70% by 2040.
In light of these goals, KN said the strategy emphasizes improving current businesses and efficiency to retain competitive advantage and enhance profitability. It outlines the aim of achieving profitable growth by developing existing core business areas while investing a share of profit into the infrastructure and competence of the new energies.
Specifically, it is based on medium-term growth and long-term portfolio diversification, divided into three phases until 2050:
- 2023-2030: Increasing profitability in existing activities and securing financing for investments in new and more sustainable energy sources.
- 2031-2040: Focusing on the development of the LNG business and diversifying the transhipment of liquid energy products.
- 2041-2050: Expanding activities in the market of new energies, including investments in new energy sources like synthetic fuels, hydrogen and hydrogen carriers, other alternative energy carriers, and carbon capture and storage (CCS).
In the short term, the company aims to establish a strong foundation for new and more sustainable energy activities and plans to achieve a 50% revenue growth by 2030.
KN also set operational targets in three key segments: liquid terminals, LNG and new energy.
In the liquid terminals segment, the emphasis is placed on product and customer portfolio diversification which includes expanding the handling of biofuels and entering the storage and handling market for chemical products such as methanol.
The LNG segment focuses on continued value creation in the regional and global LNG market. By 2030, decisions will be made regarding the expansion of the capacities of the Klaipėda LNG terminal, considering market demand. Additionally, decisions regarding the strategy of the LNG reloading station will be determined. Gradual expansion of LNG business development activities in growth markets is also planned.
In the new energy segment, KN aims to develop at least three business opportunities in the hydrogen carrier handling and storage market by 2030. It also seeks to establish a CO2 storage and handling business to contribute to controlling and reducing carbon emissions. Additionally, a pilot battery project and a sustainable business model for participating in the energy storage/balancing market will be developed.
KN added it plans to invest approximately €300 million by 2030, with over 45% of capital investments dedicated to building new infrastructure and competencies for the handling and storage of new energies, as well as enhancing sustainability and reducing emissions across all of its activities.
Finally, the company pointed out that the updated strategy corresponds with the Letter of Expectations from the Ministry of Energy of the Republic of Lithuania, received on 8 March.
As the majority shareholder holding 72.47% of KN’s shares, the Ministry outlines the company’s objectives and financial expectations concerning Lithuania’s energy independence, transformation, and international development.