Germany completes construction of its first floating LNG terminal

Jun 03, 2023

Liquefied natural gas facility will be central to securing energy supplies this winter, says minister

Germany has completed construction of its first floating terminal to receive liquefied natural gas (LNG), which its economy minister said would be vital to securing energy supplies to the country over the winter months.

Robert Habeck described the first of five planned floating terminals at the North Sea port of Wilhelmshaven as "a central building block for the security of our energy supplies this coming winter", as Germany races to find alternatives to Russian pipeline gas, on which it had relied for years until supplies were halted during the invasion of Ukraine.

A pier at Wilhelmshaven has been expanded to provide a mooring place for a floating storage and regasification unit (FSRU), the central component for transporting LNG via sea and transferring it to land. Before the end of this year, the first FSRU is due to be in operation to regasify LNG, arriving on special tankers from around the world. The first FSRU, the Esperanza, is expected to arrive with a full load in about a month and to be unloaded.

Olaf Lies, the economy minister of the northern state of Lower Saxony, in which Wilhelmshaven is located, said as more LNG tankers arrived the Esperanza would be moored accordingly, in order to process their supplies.

Habeck said the building of the mooring site had happened at "enormous speed" and called it proof that Germany was able to "quickly and with a high degree of decisiveness progress infrastructure projects", crediting the cooperation between central government and the state of Lower Saxony, which he said had "pulled together".

The government is working on introducing a total of five swimming LNG terminals to German ports, each with a capacity of at least 5bn m3 per year.

The terminal at Wilhelmshaven, and another at Brunsbüttel, are expected to be operational early next year.

The third and fourth FSRUs are to be opened at the ports of Stade and Lubmin, and are expected to be operational by the end of 2023. The fifth will be in Wilhelmshaven and is due to be up and running by the fourth quarter of next year.

In addition, a private special ship is planned for Lubmin with an annual capacity of 4.5bn m3 a year, to be ready from the end of 2022, according to the economics ministry.

A spokesperson said an annual total of 25bn m3 would be provided by state-run FSRUs, and together with the privately run FSRU would cover about a third of Germany's gas needs, based on 2021 levels.

In addition to LNG, Germany has gas storage facilities around the country that are full. They are capable of covering about 28% of the country's entire gas requirements.

The government and the Federal Network Agency responsible for power hopes existing supplies, the LNG, together with savings that industry and private homes are making, will be sufficient to get Europe's largest economy through the winter.

Lower Saxony's environment minister, Christian Meyer, was keen to stress that LNG was meant to cover short-term energy demands, and that the long-term goal was to considerably expand renewable energy, in particular wind power. It is planned that the new port terminals will also be able to switch to receiving future imports of climate neutral gases, such as hydrogen, as these become more readily available.

Germany used to receive nearly a third of its natural gas supplies via pipeline from Russia, before Moscow started reducing the flow after its invasion of Ukraine, in an apparent reaction to sanctions placed on it, and turned off supplies in late August.