Grain LNG Man on platform

Grain LNG importation terminal to offer ~8 mpta of cost competitive capacity to the market

Grain LNG importation terminal has announced that up to 350 GWh/d (8.3 mtpa) of redelivery capacity, 390,000 m3 of associated storage and over 100 berthing slots could be made available at the Grain LNG terminal in 2025.

The capacity on offer is a combination of new build and existing capacity which comes out of contract in 2025.  The expansion will increase the size of the Grain terminal, located on the Isle of Grain in Kent, to approximately 1.2 million cubic metres. 

Nicola Duffin, Commercial Manager for Grain LNG, said: “Grain already has the largest storage tanks in Europe, which offer our customers the flexibility to store their LNG and optimise send out in response to market prices.  With the expansion of Grain we will further optimise our existing assets, which means we’ll be able to be more competitive than typical new build capacity.

We’re also ideally located in the South East of the UK, so tariffs to NBP are very favourable. Our customers benefit from the short haul tariff to the IUK and BBL interconnectors, allowing them to easily move gas to other European price hubs such as TTF.  We have two entry points to the NBP, a high-pressure entry point and a low- pressure entry point that offers our customers further savings on entry costs and a much lower minimum send out requirement compared to competitors.”

Grain could also benefit from proposed changes to the gas specification rules in the UK, which would significantly reduce variable costs for LNG shippers.  The UK’s Wobbe Limits currently require some sources of LNG to be blended with nitrogen to meet UK gas specifications.  Plans are underway to increase these limits, which could come into force by April 2020 as part of the Gas Safety Management Regulations (GSMR). Proposals call for the the Wobbe Limit to be changed to 52.85 MJ/m3 – a limit that would allow all but rich LNG to enter the grid without blending. 

Duffin said: “LNG would be subject to lower processing and variable costs. Lower costs will make the UK a more attractive destination for LNG, which ultimately benefits UK energy consumers.”

Additional services available at Grain include reloads, transshipments and a multi-bay facility for reloading road tankers, and ISO containers. A marine breakbulk facility is planned for 2021/22. The Grain terminal is the only terminal in the UK offering small-scale solutions to the market.

UK terminals have seen a considerable increase in utilisation this winter as new global supplies have come online and the economics of moving LNG from the Atlantic to the Pacific basin have failed to stack up.