Snam buys 5 bcm Golar Tundra FSRU for $350 million

Italian energy firm Snam is to acquire a floating storage and regasification unit (FSRU) Golar Tundra for $350 million from Bermuda-based LNG shipper Golar.

Specifically, Snam and Golar LNG signed an agreement for the Snam Group to acquire 100 per cent of the share capital of Golar LNG NB 13 Corporation, whose sole asset is the Golar Tundra FSRU. The Golar board of directors approved the transaction on 30 May 2022.

The Golar Tundra can operate both as an LNG carrier and as an FSRU. Built in 2015, the vessel has a storage capacity of around 170,000 cubic metres of LNG. It also has a continuous regasification capacity of five billion cubic meters per year.

In order to maximise its regasification capacity, it will be located in central-northern Italy. This is close to the areas with the greatest gas consumption.

The Golar Tundra FSRU is to start operations as a floating LNG regasification terminal during the spring of 2023. Before that, it is subject to completion of authorisation, regulatory processes and the construction of the necessary infrastructure.

Snam CEO Stefano Venier said: “The role of the new FSRU for the benefit of our country will be essential; alone it will contribute to about 6.5 per cent of domestic needs thus bringing the country’s regasification capacity to over 25 per cent of the demand. Snam completed the transaction quickly and effectively in a highly competitive market due to the scarcity of supply and is continuing its efforts to acquire a second FSRU of a similar size, for which exclusive negotiations are currently underway and expected to be finalised by end of June.”

Golar CEO Karl Fredrik Staubo commented: “Today’s announced sale marks the second transaction between Golar and Snam for two independent FSRU projects in Italy in a short period of time. We are pleased to work with Snam for the successful start-up of the LNG terminals, and to contribute to Europe’s drive towards energy security.”

As part of the transaction, Golar will lease Golar Tundra from Snam as an LNG carrier for a limited period of time after closing. In addition, the company will assist Snam in the preparatory work for the installation of the vessel in the selected port.

In the coming months, Snam will begin activities to contract LNG regasification capacity, which will gradually become available from start-up of Golar Tundra as an FSRU expected during the spring of 2023.