LNG Terminal Expansion Program

LNG Terminal Expansion Program

The expansion of the President Lech Kaczyński LNG Terminal in Świnoujście is part of a larger investment plan by the GAZ-SYSTEM Capital Group, the so-called Northern Gateway, the aim of which is to prepare the Polish gas transmission system to change the east-west supply direction to the north-south direction.

The project to expand the Polish terminal is on the European list of Projects of Common Interest. This list includes investments of particular importance for the improvement of security and diversification of natural gas supply in Europe. They also contribute to achieving the EU’s energy and climate goals.

The expansion of the Świnoujście Terminal co-financed by the Infrastructure and Environment Operational Programme 2014-2020, PRIORITY: VII, MEASURE: 7.1 as part of the project titled: “Expanding the functionality of the LNG Terminal in Świnoujście”.

The LNG Terminal Expansion Program is split into two stages:

  • STAGE I - SCV project
  • STAGE II - Projekt Zbiornik i Projekt Nabrzeże
 

Stage I - SCV project

Regasification infrastructure based on SCV regasification devices. Expansion of the existing installation, including by adding two extra SCV (Submerged Combustion Vaporisers).

The equipment was ordered by Polskie LNG (currently GAZ-SYSTEM) in October and November 2019, as part of investor deliveries. The SCV Project Contractor was selected and the contract with the consortium of PORR S.A. and TGE Gas Engineering GmbH was signed in February 2020.

Starting from January 2022, the Terminal can provide regasification services, in accordance with contracts and demand, using its increased annual capacity of 6.2 bcm.

Stage II - Storage Tank Project

Construction of a new LNG storage tank featuring a gross capacity of approx. 180 thousand m3 along plus auxiliary installations and equipment and connection to the existing infrastructure.

The agreement with the consortium of PORR S.A. and TGE Gas Engineering GmbH, commissioning the work, was signed on 24 June 2020.

Stage II - Jetty Project

Construction of a new jetty for LNG unloading, loading and bunkering along with a dedicated transmission pipe rack.

  • Process Part - fitting equipment and systems for LNG unloading, loading, bunkering and transmission on the new berth and the transmission pipe rack - pipelines, valves, arms connected to ships.
  • Hydrotechnical infrastructure - Construction of the stand, offshore transmission pipe rack structure and mooring infrastructure. Investor: Zarząd Morskich Portów Szczecin i Świnoujście S.A.
 

The agreement with the consortium of PORR S.A. and TGE Gas Engineering GmbH, commissioning the work, was signed on 24 June 2020.

The Expansion Program in progress is set to assumes extend the existing and create new functionalities of the LNG Terminal in Świnoujście by:

  • increasing the regasification capacity and dispatch of gas to the transmission network,
  • increasing the in-process storage capacity of LNG by building a third tank,
  • construction of new maritime infrastructure, also for loading, unloading, and reloading of LNG and bunkering of ships.

Benefits of the Expansion Programme

The LNG Terminal Expansion Program will contribute to the improvement of Poland's energy security and will increase the level of diversification of natural gas supply sources for Poland and regional markets.

Specifically, the Expansion Program will enable:

  • increasing the volume of natural gas imported to Poland by at least 2.5 billion Nm3/year from various directions,
  • increasing the nominal transfer capacity to 856 thousand Nm3/h to the National Transmission System (the target maximum regasification capacity of the installation - 984 thousand Nm3/h),
  • improving the flexibility of LNG Terminal operations by increasing the in-process LNG storage capacity to approximately 500 thousand m3 gross,
  • increasing the level of reliability and flexibility of LNG supply receipt,
  • increasing the volume of LNG exported by land and enabling shipments by sea,
  • increasing the revenue from provision of new services: bunkering of ships, loading LNG on small, mid and large scale LNG vessels, LNG transhipment  from ship to ship,
  • developing the infrastructure to enable greater use of LNG in the Region.

Other benefits:

  • strengthening regional security of supply through diversification of supply (access to new sources of gas supply),
  • increasing the possibility of importing LNG on spot terms at times of seasonal price reductions,
  • increasing competitiveness on regional gas markets and facilitating price convergence between markets, opening the market to new entrants and potentially increasing the demand for gas in the regions covered by the expanded LNG Terminal,
  • increasing technical reliability of gas supplies to customers by diversifying import imported gas supply routes,
  • securing gas supplies in crisis and emergency situations,
  • increasing the negotiating position vis-à-vis the current gas suppliers,
  • significantly increasing the reliability of Terminal operations by implementing an independent connection between the new berth and the Terminal's onshore infrastructure, reduction of harmful emissions to the environment by providing and increasing access to clean fuel,
  • developing the infrastructure associated with bunkering of vessels on the Baltic Sea and Polish inland waters,
  • developing the infrastructure supporting LNG supply logistics in the region,
  • starting point for the development of local gas distribution networks in the part of the country previously lacking gas infrastructure,
  • avoiding the costs of gas supply interruptions for users,
  • opening the market of LNG re-export in the Baltic Sea basin for businesses from Poland,
  • attracting and educating qualified personnel to enable effective implementation of future investments in the development of the LNG market in Poland.

Calendar of key events in the Expansion Programme

 2017

  • 02/2017: GAZ-SYSTEM's recommendation for the SCV Project
  • 02/2017: launch of preparatory work for the SCV project
  • 04/2017: contract for the Jetty Project Feasibility Study
  • 09/2017: GAZ-SYSTEM's recommendation for the Jetty Project
  • 10/2017: completion of the technical part of the Railway Project Feasibility Study
  • 10/2017: completion of the technical part of the Storage Tank Project Feasibility Study
  • 11/2017: environmental decision for the SCV Project
  • 11/2017: cooperation agreement with Zarząd Morskich Portów Szczecin i Świnoujście S.A.
  • 12/2017: GAZ-SYSTEM’s recommendation for the Railway Project
 

2018

  • 01/2018: GAZ-SYSTEM’s recommendation for the Storage Tank Project
  • 01/2018: Programme financing application under OPI&E
  • 05/2018: completion of the Feasibility Study: "Technical Concept for the LNG Terminal Expansion"
  • 05/2018: approval of the Preliminary Definition of the Terminal Expansion Program - launch of the Expansion Programme
  • 06/2018: building permit decisions for the SCV Project
  • 11/2018: approval of Strategic Investment Directions of Polskie LNG (currently GAZ-SYSTEM)
  • 12/2018: launch of the tender procedure for the award of SCV, Rail and Storage Tank Project contracts - onshore part of the expansion (RZ/91/ZP/2018/PLNG)
  • 12/2018: conclusion of the agreement with Zarząd Morskich Portów Szczecin i Świnoujście S.A. on joint implementation of an investment (Jetty Project), signing a preliminary conditional lease agreement and appointment of a joint Tender Committee
  • 12/2018: environmental decisions for the Jetty, Rail and Storage Tank Projects

2019

  • 01/2019: launch of the tender procedure for the award of the Jetty Project contract - offshore part of the expansion (RZ/102/ZP/2018/PLNG)
  • 01/2019: signing of the contract with the Technical Advisor (Tractebel)
  • 01/2019: location decisions for the Rail, Storage Tank and Jetty Projects
  • 02/2019: submission of 9 applications for participation in the tender procedure for the award of a contract in the onshore part of the Expansion Program
  • 03/2019: submission of 6 applications for participation in the tender procedure for the award of a contract in the offshore part of the Expansion Program
  • 03/2019: update of the Feasibility Study developed for the purpose of applying for OPI&E funding
  • 03/2019: approval of the Terminal Expansion Consolidated Schedule
  • 03/2019: location decision granted to Zarząd Morskich Portów Szczecin i Świnoujście S.A. for the Jetty Project in the part belonging to Zarząd Morskich Portów Szczecin i Świnoujście S.A.
  • 03/2019: EC positive decision on the financial support for the Expansion Program.
  • 04/2019: Signing the Agreement with Zarząd Morskich Portów Szczecin i Świnoujście S.A. on connecting Polskie LNG (currently GAZ-SYSTEM) railway siding to the Port's track layout
  • 04/2019: signing of a grant agreement under the Operational Programme Infrastructure and Environment 2014-2020 for the project: Expansion of the functionalities of the LNG terminal in Świnoujście
  • 04/2019: 4 applicants qualified to the 2nd stage of the tender procedure for the award of a contract in the onshore part of the Expansion Program
  • 06/2019: 5 applicants qualified to the 2nd stage of the tender procedure for the award of a contract in the offshore part of the Expansion Program (Jetty)
  • 07/2019: change of the technical scope of the Program - new route of the pipe rack
  • 07/2019: launch of the process of amending environmental decisions for the Railway and Storage Tank projects plus the Jetty project
  • 10/2019: launch of the tender procedure for the award of the SCV Project contract
  • 10/2019: signing the agreement for the delivery of 2 SCVs
  • 10/2019: launch of negotiations with potential contractors in the onshore part of the Expansion Program
  • 12/2019: launch of negotiations with potential contractors in the offshore part of the Expansion Program (Jetty)
  • 11/2019: signing the contract for the purchase and delivery of LP and HP pumps for the SCV Project
  • 12/2019: negotiations for the execution of construction works in the SCV Project
  • 12/2019: completion of geological survey documentation

2020

  • 01/2020: signing the Inspection Agency service agreement
  • 02/2020: signing the contract with the SCV Project contractor
  • 02/2020: final bid submission request to the contractors of the onshore and offshore part of the Expansion Program
  • 02/2020: amending environmental decision (issued by RDEP in Szczecin) of the environmental decision 65/2018 for the Storage Tank and Railway Projects
  • 03/2020: submission of 9 applications for participation in the procedure for the selection of the Contract Engineer
  • 03/2020: amending environmental decision (issued by RDEP in Szczecin) of the environmental decision 62/2018 for the Jetty Project
  • 04/2020: amended location decision 2/2020 for the Jetty Project
  • 05/2020: competitive dialogue with applicants qualified in the procedure for the selection of the Contract Engineer
  • 05/2020: conclusion of a regasification agreement under the Open Season procedure
  • 06/2020: final bid submission request in the procedure for the selection of the Contract Engineer
  • 06/2020: pre-emptive audit of the Public Procurement Office in the procedure for expansion of the Terminal, onshore and offshore part
  • 06/2020: signing contracts with the contractor for the expansion of the LNG Terminal in the onshore and offshore part
  • 07/2020: handover of the construction site to the contractor for Stage I of the Expansion Program
  • 08/2020: signing the agreement with the Contract Engineer
  • 11/2020: first investor deliveries (regasification components) for Stage I of the Terminal expansion

2021

  • 02/2020: Decision of the Zachodniopomorskie Province Governor on the Building Permit for the Storage Tank Project.

European Funds Infrastructure and Environment

Extending the functionality of the LNG terminal in Świnoujście - Signing the co-financing agreement

On April 24, 2019, Polskie LNG (currently GAZ-SYSTEM) signed with the Oil and Gas Institute - Polish Research Institute a co-financing contract for the project titled "Extending the functionality of the LNG terminal in Świnoujście" with the grant amount of PLN 460 999 999, 99 from the European Regional Development Fund under the Operational Program Infrastructure and Environment 2014-2020.

The estimated total value of the project is over PLN 1 billion. The project consists of the following elements:

  • Additional regasification installation - increasing the nominal regasification capacity of the LNG Terminal up to 7.5 billion Nm3/year.
  • Third LNG process storage tank - increasing the LNG terminal's operational flexibility and optimizing fuel storage process capacity.
  • LNG-to-rail transshipment installation - extending the scope of services with the possibility of loading LNG on ISO containers and rail tankers and thus providing new potential customers with access to the fuel.
  • Additional jetty for handling the loading and unloading operations - LNG transshipment, loading LNG on bunker vessels, and bunkering service.
 

Pursuant to Project objectives and assumptions, the project is to deliver output indicator defined under OPI&E 2014-2020, priority axis VII Improvement of energy security, activity 7.1 Development of intelligent storage, transmission and distribution systems as "additional annual capacity of the receiving terminal for LNG arriving by sea freight."

The completion of the co-financed project is scheduled in December 2023.