Ownership of FSRU deployed in Europe changes hands

Lithuanian liquefied natural gas (LNG) terminal operator KN Energies (KN), former Klaipedos Nafta, has taken possession of a floating storage and regasification unit (FSRU) working at its LNG terminal on Lithuania’s Kiaulės Nugara Island.

The Klaipėda LNG terminal, which has been active since 2014, with commercial activities starting a year later, is located on Lithuania’s Kiaulės Nugara Island and consists of a permanently moored FSRU Independence, a 450-meter-long berth, a connecting nearly 18-kilometer-long gas pipeline, and a gas metering station.

The technical operator of the FSRU was Hoegh LNG Klaipėda while KN Energies was expected to become the owner of the FSRU in December 2024. According to the Lithuanian LNG terminal operator, the ownership of the FSRU Independence has now passed into its hands.

Erik Nyheim, President & CEO of Höegh Evi, highlighted: “A decade ago, Lithuania’s vision to leverage marine infrastructure for energy security set a powerful example. The Independence is now a cornerstone of the region’s critical energy infrastructure. Höegh Evi is honoured to continue working with KN Energiés to provide Lithuania and its neighbours with a reliable supply of natural gas.”

With the transaction registered in the Lithuanian Seagoing Register, the event is expected to be marked by the raising of the tricolor and the unveiling of the home port name, Klaipėda, during the official handover ceremony.

Darius Šilenskis, CEO of KN Energies, underlined: “Hoegh LNG Klaipėda, part of the Höegh Evi group, will continue to provide technical operation and maintenance of the FSRU for the next five years, with an option to extend this cooperation for an additional five years. Over the years, the company has proven to be a reliable and trusted partner.”

The acquisition price was €138.04 million (about $153.50 million). KN Energies explains that the obligation to acquire and own the FSRU by the end of 2024 and ensure its operation until December 31, 2044, is dictated by the country’s law related to the LNG terminal.

“The takeover of the vessel on this date is the result of the decision of the General Meeting of Shareholders in 2022 and the FSRU Independence sale and purchase agreement concluded in spring 2024,” elaborated the company.

The Klaipėda terminal, which secured full occupancy until 2033, witnessed the transfer of 105,000 cubic meters of LNG a few months ago from the FSRU to the Amur River LNG vessel. Recently, the EU’s Modernisation fund program decided to allocate €6 million to support the Klaipėda LNG terminal electrification project.

Once a final investment decision is made by the firm’s management, which is expected in the first quarter of 2025, the implementation of the electrification project is planned to take three years. As KN Energies has extended a contract with Poland’s ORLEN, the latter can use the small-scale reloading station in the Baltic country for five more years.

Gitanas Nausėda, President of the Republic of Lithuania, commented: “Klaipėda’s LNG terminal stands as a powerful symbol of Lithuania’s political resolve, determination, and commitment to achieving energy independence.

“It has played a pivotal role in reshaping the country’s energy landscape and enhancing regional energy security, opening up new opportunities for diversification.“