Gasunie Talking with Germany Over Floating Terminals at New LNG Facility

VIENNA (Reuters) — Dutch network operator Gasunie is in talks with Germany to use floating storage and regasification units (FSRUs) in the port town of Brunsbuettel to help accelerate LNG imports as part of a plan to phase out dependence on Russian gas.

Earlier this month, German state lender KfW signed a memorandum of understanding with Gasunie and the country's top power producer RWE to build the terminal in Brunsbuettel.

"We are in discussions with the government to see the feasibility of this. We don't exclude connecting in FSRUs first," Marcel Tijhuis, senior business developer at Gasunie & German LNG, said at a European gas and LNG conference in Vienna.

"They (German authorities) are in a hurry, they are pushing to have the terminal built as soon as possible," Tijhuis said, without giving further details.

Germany, which heavily relies on Russian gas and oil, has no LNG import terminals. The Brunsbuettel terminal would have an annual capacity of 8 billion cubic meters (Bcm).

The European Commission last week published a blueprint to cut European Union dependency on Russian gas by two-thirds this year and end all Russian fossil fuel imports well before 2030.

It proposes importing around 50 Bcm of LNG, equivalent to around 10% of annual global LNG supply or the combined volumes of Egypt, Algeria and Nigeria.

But there is limited regasification capacity in northwest Europe, making the use of FSRUs a possible quick way to secure more LNG cargoes.

"The addition of new regasification terminals would incur additional infrastructure capex (capital expenditure). FSRUs work out to be the cheaper option for leases of up to six years, and so are well suited to Europe’s current situation, given the long-term focus remains to shift away from fossil fuels," Kaushal Ramesh, senior LNG analyst at Rystad Energy, said.

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