Sweden: Skangass, Preem Ink LNG Deal

Skangass AS and Preem AB have signed an agreement regarding the delivery of liquefied natural gas (LNG) to Preem’s refinery in Lysekil on the west coast of Sweden.

The agreement involves building the largest LNG receiving terminal in Scandinavia next to the refinery, an investment estimated at 55 million EUR.

Skangass will deliver up to 200,000 tonnes of LNG per year to Preem’s refinery in Lysekil. Natural gas will replace butane and naphtha as feedstocks in the refinery’s steam reformer. This will reduce the CO2 emissions by up to 130,000 tonnes per year.

A truck loading facility will be built in connection to the terminal. This will enable efficient distribution of LNG within Sweden, making it possible for industries to convert to natural gas – an energy efficient and clean fuel.

The terminal will also become an important hub for distribution of LNG as fuel for ships. A shift to LNG as marine fuel is one of the most effective ways to reduce emissions and meet stricter environmental requirements in the area.

“The new LNG terminal in Lysekil is of great strategic importance for Skangass. In addition to deliveries to Preem, the terminal will open up new market segments and strengthen our position in the Swedish market” says Bjørn Torkildsen, CEO of Skangass.

LNG will be delivered to Lysekil using Skangass own LNG carrier – Coral Energy. The vessel is currently under construction at Meyer Werft in Germany and will be fitted with dual fuel engines that will run on LNG. The LNG terminal is scheduled to be in operation by the end of 2013.

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LNG World News Staff, March 14, 2012