Gaz-System signs a charter agreement for the first FSRU in Poland -
Gaz-System signs a charter agreement for the first FSRU in Poland
Date of publication: 25.04.2024

Gaz-System signed a charter agreement specifying the terms of delivery and operation of the FSRU (floating storage & regasification unit) in the Gulf of Gdańsk. The contract was concluded with White Eagle Energy Ltd., a company from the Mitsui O.S.K. Lines group.

- The FSRU terminal is a strategic investment that will meet the most urgent needs related to ensuring the diversification and security of natural gas supplies to both Poland and the region. This is expressed by the allocation of funds from the KPO under the REPowerEU program for the construction of the onshore part of the FSRU. Contracting by the LNG storage and regasification units is another important stage of this project - said Maciej Bando - Government Plenipotentiary for Strategic Energy Infrastructure.

- The signed Time Charter Party (TCP) agreement is the result of a very intensive tender process initiated last year and many months of negotiations between Gaz-System and Mitsui O.S.K. Lines. The contract specifies the detailed terms of the charter of the first floating regasification unit in Poland - noted Sławomir Hinc, President of the Management Board of Gaz-System.

- The second LNG Terminal in Poland will ensure the flexibility of natural gas supplies to Poland, which is necessary to guarantee the continuity of supply to recipients in each province and the safety of the national transmission system - added President Hinc.

- By signing the TCP agreement, we have achieved an important milestone. On this occasion, I would like to express my appreciation for the commitment and effort put into this process by both parties. Mitsui O.S.K. Lines appreciates the opportunity to contribute to increasing Poland's energy security. I believe that this agreement will allow Mitsui O.S.K. Lines to use its extensive experience and knowledge from implementing such projects around the world. We look forward to developing this project with our valued partners and Gaz-System. We are convinced that this is the beginning of a long-term relationship based on trust, mutual respect and a shared vision of the future - said Toshinobu Shinoda, Managing Director of Mitsui O.S.K. Lines, responsible for Europe and Africa.

The FSRU terminal in the Gulf of Gdansk will be of great importance not only for increasing the energy security of our country and region, but will also provide support for the ongoing process of decarbonization of the Polish economy.

The unit that will be the subject of the charter will have a capacity of approx. 170 thousand m3 of LNG and a regasification capacity of approx. 6.1 billion m3 of natural gas per year. The on-board devices for regasification of liquefied natural gas will have a nominal capacity of no less than 783.5 thousand m3/h. The contract was concluded for a period of 15 years with the possibility of further extension. On the basis of the charter agreement, Gaz-System also secured the right to buy the FSRU.

The construction of the ship will be the responsibility of the South Korean shipyard HD Hyundai Heavy Industries, with which White Eagle Energy Ltd. concluded a parallel Ship Building Contract (SBC).

Mitsui O.S.K. Lines is a group with a long tradition in the international shipping industry. It manages one of the world's largest commercial fleets consisting of almost 800 ships. The Mitsui O.S.K. Lines LNG carrier fleet consists of almost 120 ships, including 7 FSRU's, and is the largest in the world.

The FSRU terminal construction project assumes the location of one floating FSRU (Floating Storage Regasification Unit) in the Gulf of Gdańsk, which will enable LNG unloading, process storage and regasification of LNG, and will also be adapted to provide additional services. Gaz-System will be responsible for the following project components: floating FSRU terminal, hydrotechnical infrastructure, including a ship berth (shore), offshore gas pipeline and onshore gas pipelines. The Maritime Office in Gdynia is tasked with constructing a protective breakwater.

The demand for the full capacity of the FSRU unit was expressed by the Orlen group, which placed an order covering 100% of the regasification services provided by Gaz-System.

The FSRU terminal in the Gulf of Gdańsk will guarantee stability and continuity of supplies and diversification of energy sources to Poland and the CEE region. The construction of gas infrastructure that enables the receipt of liquefied gas from any direction in the world, as well as the related expansion of the national transmission network, are treated as strategic investments, key to energy security. The FSRU terminal in the Gdańsk region is part of the process of energy and economic transformation of the country, assuming a transition to less emission energy sources.

The investment is being carried out using European Union funds. In November 2023, the European Commission included the onshore gas pipelines planned for implementation under the FSRU Program in the loan part of the National Recovery and Resilience Plan (KPO) in the REPowerEU chapter on the development of infrastructure necessary to meet the most urgent needs related to security of supply (component G3.2. - Improving energy infrastructure and facilities to meet immediate security of supply needs for gas).

Under the Connecting Europe Facility (CEF), the European Commission awarded the LNG Gdańsk project funding for the action called: "Pre-investment works to obtain a building permit for the offshore part of PCI 6.27 LNG Gdańsk (PL)". The maximum amount of support granted is approximately EUR 19.6 million.

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