UK: Commissioning Cargo Arrives Today for £310 Million Expansion of National Grid*s Grain LNG Terminal

The first liquefied natural gas (LNG) cargo will be delivered today to the new jetty at National Grid’s Isle of Grain LNG importation terminal.

This begins the final stage of commissioning the £310 million Phase 3 expansion, on time and to budget, of the UK’s leading LNG terminal. It marks another major milestone for Grain LNG and brings the overall investment by National Grid to more than £800 million. A second new state-of-the-art jetty and an additional above ground LNG storage tank – the world’s largest and bigger than the Albert Hall – have increased Grain LNG’s ability to import and store liquefied natural gas, boosting the capacity of the expanded terminal to enable it to handle 20% of UK gas demand.

Grain LNG now has the largest tank capacity of any terminal in the UK with total storage availability of one million cubic metres, equivalent to more than two days worth of average UK gas demand. Iberdrola, in conjunction with E.ON Ruhrgas, the terminal’s new customers, will deliver the first cargo to the new jetty.

Centrica, an existing customer, has also taken additional capacity in Phase 3. This jetty is capable of berthing and unloading a Q-max supertanker with a capacity of 265,000 cubic metres of LNG – the largest available LNG carrier in the world. The final phase of commissioning will progress over the coming weeks.

With UK Continental Shelf gas reserves continuing to decline, and import dependency is forecast to increase to around 70% by 2020, LNG is becoming an increasingly important element of Britain’s gas supplies. National Grid is progressing discussions on a further phase of expansion at the terminal with a number of interested parties through an open season process.

Timescales and capacity will depend on final market interest, but additional capacity could be available from winter 2015/16. Peter Boreham, National Grid’s Director of UK LNG, said: “Today marks another success for Grain, which has pioneered the way as Britain’s first and largest modern LNG importation terminal.

Since it began operation five years ago, it has built a proven track record in delivering on time for its customers. “Discussions about a further phase of the terminal are continuing in a very positive way. As UK importation requirements continue to increase, Grain, now with its two jetties, represents a highly attractive opportunity for LNG shippers to secure their future position as part of the UK’s supply portfolio.

Grain LNG, as an independent operator with no gas market interests, is an ideal partner and the commissioning of a third phase of capacity demonstrates we continually deliver on our commitments.”

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Source: UK National Grid, October 29, 2010