Germany opens first private floating LNG terminal

Struggling to keep the wheels of industry turning in the power crisis, Germany’s first private floating liquefied natural gas (LNG) terminal has officially started commercial operations. Converting 5 billion cubic meters of liquefied natural gas per year into gas…

The first privately funded floating LNG Storage and Gasification Unit (FSRU) in the Lubmin region on the Baltic Sea coast of Germany, with the participation of German Chancellor Olaf Scholz and Chancellor of the State of Mecklenburg-Vorpommern Manuela Schwesig and Parliamentary Secretary of the German Ministry of Economy and Climate Defense Michael Kellner was put into service.

“We are getting through this winter,” Scholz said at the opening.

Pointing to the heavy efforts of the German government to secure the power supply and the decrease in natural gas prices in global markets, Scholz said, “An economic crisis did not occur in Germany either.”

Gas supply security is one of the key political priorities

As concerns about the Russo-Ukrainian War continue to weigh on power supplies in the region, the German government is scrambling to keep the wheels of industry turning, the lights on, and the dwellings warm this winter.

While the German government is dealing with the power crisis triggered by Moscow’s decision to stop the flow of gas through the Nord Stream 1 natural gas pipeline, Scholz announced that after the war in question, the German government decided to quickly build the first LNG terminals in the country.

Germany’s efforts to build a series of LNG import terminals took a hit after Russia reduced gas supplies to Europe.

Gas supply security has become one of Germany’s top political priorities, as the German government hastened to fill gas storage facilities and set up LNG import infrastructure despite record high gas prices.

The facility will convert 5 billion cubic meters of LNG annually into gas

The opening of the first private branch LNG terminal was considered a milestone in Germany’s plans to find alternative natural gas sources.

Lubmin floating LNG terminal, whose approval from local administrations was delayed by 3 weeks, includes a specially equipped ship called “NEPTUNE” called “floating storage and gasification unit”.

The new facility, which will serve as an LNG import terminal, has the capacity to convert 5 billion cubic meters of liquefied natural gas into gas per year.

The floating terminal is intended to help close the gap in Germany’s gas supply caused by the lack of supplies from Russia.

It will be able to meet one-third of Germany’s natural gas needs.

Operated by Deutsche ReGas, the Lubmin facility is the second operational FSRU-based terminal in Germany.

Germany’s first FSRU-based LNG facility by German power company Uniper and its partners in Wilhelmshaven was put into service on 17 December 2022.

The 2 FSRU ships are scheduled to be operational this year at Wilhelmshaven in Lower Saxony and at Brunsbüttel in Schleswig-Holstein. An FSRU will also be placed in the city of Stade by the end of 2023.

According to the German Ministry of Economy and Climate Protection, the LNG terminals in question will be able to meet one-third of Germany’s natural gas needs.

Germany turns to coal after Russia restricts gas shipments

Germany’s attempt to mitigate power shortages simultaneously involves re-enabling coal-fired power plants as well as extending the life of Germany’s three remaining nuclear power plants.

Germany, which aims to be carbon neutral by 2045, previously announced that it aimed to close coal-fired thermal power plants in 2038, and in 2021, it reached an agreement with some power plant operators and pushed this date to 2030.

Pushing the target date for the end of coal-fired electricity generation from 2038 to 2030 was one of the key election promises of the German coalition government last year.

After the Russia-Ukraine War triggered a power crisis in Europe, it became difficult to achieve this goal, and Germany, which stopped buying natural gas from Russia, decided to turn to the domestic coal industry in order to secure an alternative power supply.

Decided to keep nuclear power plants open

In this process, in order to reduce dependency on Russia, the German government decided to keep the nuclear power plants open, which it had previously announced to close.

Last year, the German government took action to reconnect a number of coal-fired power plants to the grid, prolonging the life of a few that needed to be shut down.

Before the Russia-Ukraine War, Germany imported more than half of the natural gas and coal it needed, and 34 percent of the crude oil from Russia.