Saturday, May 25, 2024
HomeLNGEstonia and Finland sign cooperation agreement for floating LNG terminal

Estonia and Finland sign cooperation agreement for floating LNG terminal

Estonian Minister of Economic Affairs and Infrastructure Taavi Aas his Finnish counterpart Mika Lintilä signed a memorandum of mutual understanding establishing the framework for cooperation between the two countries to ensure reception capacity for liquid natural gas (LNG).

“It makes sense for good neighbours to launch major energy projects across borders,” Minister Aas remarked. “Estonia operates on the same gas market as Finland and a new source of natural gas is something we both need to secure right now in order to bolster energy security throughout our region and put an end to our use of Russian gas.”

The memorandum of understanding signed by the Ministers states that the joint project aimed at ensuring gas supply security will be implemented as quickly as possible, but no later than by the end of 2022. The plan is to lease a floating terminal whose annual regasification capacity is at least 30 terawatt-hours (TWh). Estonia and Finland will share the cost of the terminal proportionally to how much gas each country uses.

Minister Aas emphasised that bringing the LNG terminal to the area is a temporary measure to ensure the security of supply.

“What we are working to achieve is for us to be able to get by without Russian gas as early as next winter,” he explained. “The situation on the European gas market is becoming more unpredictable: things are changing in a matter of days, not weeks or months. That is why it makes sense to entrust the establishment of the short-term reception capacity that is needed – and to do so as quickly as possible – to the gas system administrators in our two countries, since they are already responsible for ensuring the security of the gas supply. How long this solution remains in place depends on how soon longer-term, market-based solutions take root in our region.”

The next step in this process is the signing of a cooperation agreement between the Estonian system administrator Elering and the Finnish company Gasgrid.

Sign up for our newsletters

    Monthly newsletter – Delivering the most important energy stories of the month selected by our Editor-in-chief
    Weekly Oil&Gas roundup - All major news about the oil and gas industry, LNG developments, the upscaling of new gases and related EU regulations arriving in your mailbox every Monday.
    Weekly Renewables&Climate roundup - All major news about investments in renewable energy sources, environment protection, green hydrogen and new innovative ways to tackle the climate crisis arriving in your mailbox every Tuesday.

    Most Popular