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Gate LNG shatters records

Global supply glut sees Dutch facility receive more cargoes than ever before

The 12bn m³/yr Gate LNG import terminal has unloaded 111 cargoes this year up to early September, the facility's managing director Wim Groenendijk tells Petroleum Economist. That compares with 104 in all of 2018, its prior record-setting year.

"It has really taken off. So far this year, we are almost at the point where we have put more gas into the pipeline network than in the period from 2011 up to and including 2018. Of course, I would like to say that all this is because I joined Gate terminal in November," Groenendijk jokes. "But reality compels me to say that that was just a lucky coincidence."

A recent spike in new liquefaction capacity has been greater than the growth in LNG demand, prices have fallen globally and made Europe a more attractive destination, says Groenendijk. "If I look at the fact that quite a few [liquefaction] projects are coming on stream—there could be other factors of course—then I would say the period of LNG being rather plentiful may well continue for some time, maybe even a few years."

After several months of running at close to full capacity, the Gate terminal managers decided in March to test market appetite for increasing the send-out rate by 2bn m³/yr in an open season. Despite a few expressions of interest, the open season closed at its mid-April deadline with no firm agreements. "We are in discussion with customers. We will have to see where that will go," Groenendijk says.

Gate managing director Wim Groenendijk

For now, Groenendijk has his eyes set on new services. In late 2016 the terminal added a new jetty that can accommodate smaller vessels, including LNG bunkering ships. The Port of Rotterdam is expecting sales of LNG as a marine fuel in its waters to rise to 30,000t this year, a more than threefold increase from last year's sales of 9,500t. By 2025-30, the port foresees this figure reaching 1mn t.

As the port's only LNG facility, Groenendijk hopes Gate can count on booming LNG bunkering business at his small-vessel jetty, and studies into further expansion are ongoing. "[The small jetty] is something we are really studying to expand. It is a matter of 'how' rather than 'if'," he says. "We need to prepare for building some additional infrastructure. From the current jetty 3 we need to expand to more jetties, 4 and 5 maybe. And possibly even more."

Since 2014, Gate has also offered LNG loading onto trucks, now from three loading bays. As some of these vehicles also service the LNG bunkering market, Groenendijk is ready to build further bays if necessary, he says, adding that last year's record of over 2,800 fueled trucks will probably be surpassed by the end of December. "The month of August was a new monthly record of 343 trucks. Things are looking good, we see some growth there."

But competition in this niche market is already heating up, with Belgium's nearby Zeebrugge terminal offering two truck loading bays and the Dunkirk LNG terminal in northern France, only some 300km away, gearing up to open its first truck loading bay by the end of this month. "That will probably take away some of our market," Groenendijk admits. "In the past, our trucks went all over Europe, but we are seeing that market becoming more local."

Groenendijk's team is also studying the feasibility of distributing LNG by rail, which would be a first in Europe. Train connections from Rotterdam are excellent into the rest of the Netherlands but also to Germany, he says. "We are already discussing with a few prospective customers who have approached us. We are looking at how much it would cost, what could be the potential volume that could go that way, what would be the tariffs we need to charge."

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