Italy gets its ambitious small-scale LNG programme underway

Ground has been broken on the project to build the HiGas small-scale LNG terminal at the Sardinian west coast port of Oristano. At the same time the Keppel Singmarine yard at Nantong in China has laid the keel of the 7,500 m³ Stolt-Nielsen LNG carrier that will service the depot.

The HiGas facility is one of 11 small-scale LNG receiving terminals that Italy plans to have in operation around its coasts by the early 2020s. All would provide LNG marine bunkering and road tanker loading services while six, including HiGas, would also regasify LNG on site and feed gas into local pipelines. To function as marine bunkering facilities, the terminals will be able to reload LNG bunker vessels (LNGBVs) as well as receive cargoes. 

The country’s new commitment to LNG is being driven by, among other things, the European Union’s directive on alternative fuels and the upcoming introduction, on 1 January 2020, of IMO’s new global sulphur cap for marine fuels. 

One notable, specific spur of Italy’s interest in small-scale LNG and LNG bunkering activities is the new generation of LNG-powered Mediterranean cruise vessels of 180,000 gt and above currently under construction. Such vessels are being provided with bunker tank capacities in the 3,000-3,500 m³ range. 
 
Sardinia is an important focus for Italy’s small-scale LNG ambitions. Subject to successful final investment decisions, the Mediterranean’s largest island will play host to five of the anticipated 11 terminals. Three are planned for Oristano, one for Porto Torres in the north and one for Cagliari in the south.

The other six proposed small-scale terminals are at Genoa and Livorno, on the Tyrrhenian Sea, Naples, Gela in southern Sicily and Porto Marghera and Ravenna in the Adriatic. Besides HiGas, only Ravenna and a second Oristano project, tabled by Edison, have received the necessary authorisations. Genoa, Naples and Gela are still at the study stage while the others are at various points in the permitting process. 

This news article will focus on the three small-scale terminals that have so far received clearance from the Italian authorities. LNG World Shipping will feature the outstanding eight terminals in a future bulletin.

The HiGas terminal, which is under construction in Oristano’s Santa Giusta industrial port zone, is poised to become the Mediterranean’s first small-scale marine LNG terminal. It will feature 9,000 m³ of LNG storage in six horizontal tanks of 1,500 m³ each. Stolt-Nielsen holds a 66.25% stake in the company while the remaining shares are split evenly between Gas & Heat (G&H) and CPL Concordia. 

The 7,500 m³ small-scale LNG carrier that Stolt-Nielsen is providing for the project will also be able to serve as an LNGBV. The ship is due for delivery in Q2 2019 and the project partners intend to have the HiGas terminal in service by the second half of 2019. 

Marine Engineering Services of Trieste, an affiliate of G&H, played a key role in the design of the Stolt-Nielsen ship. It is one of a pair of sister ships currently under construction for the owner at the Keppel Singmarine yard.

HiGas will be able to source LNG from sources in the western Mediterranean, including Italy’s La Spezia and FSRU Toscana import facilities and terminals in France, Spain and Algeria. 

Edison, part of the EDF energy group, is behind the second Oristano terminal to be authorised. The facility will have seven horizontal tanks totaling 10,000 m³ in aggregate and a jetty able to accommodate LNGCs of up to 27,500 m³. 

Edison is also involved with the Ravenna project, the third Italian small-scale LNG terminal to be approved. The company is working with Petrolifera Italo-Rumena to develop the scheme which calls for two 10,000 m³ atmospheric pressure LNG storage tanks and a jetty able to accommodate LNGCs of up to 27,500 m³. The partners plan to bring the first phase of the facility, with the initial 10,000 m³ tank, into operation in 2020.

Towards the end of 2017, Edison invited shipowners to bid on a 27,500 m³ LNG carrier newbuilding to meet the company’s LNG distribution needs.