MET ponders LNG expansion after Krk success
Switzerland-based energy company MET is monitoring LNG terminal developments in Greece and Northwest Europe with an eye to potentially expanding its portfolio, while remaining involved in Croatia’s Krk terminal, MET head of LNG Esther Ang tells Energy Intelligence.
Source: Energy Intelligence
The firm is involved in gas and power, with a focus on Central and Eastern Europe thanks to its Hungarian origins. It is also present in Spain Italy, France and Germany.
Following a successful first year at Krk, MET is keen to grow in LNG. “We are carefully monitoring what projects are coming up in Greece, and there are quite a few. … [And] the German terminals are something we are definitely also considering, but it is a bit further up for us and it is not our home area," Ang said.
The most highly touted Greek project is the 3.8 million ton per year (5.5 Bcm/yr) Alexandroupolis floating storage and regasification unit, which is expected to start up in 2023.
Ang said that although MET would like to become more involved in Northwest European LNG markets, the region already has many players and incumbents with long-established positions and booked capacity at regional terminals.
Turkey is another market that MET would like to unlock — as would other firms — Ang said. But third-party access is difficult. Right now, Turkish state Botas is the exclusive importer of LNG.
In Spain, MET is gradually increasing its pipeline and LNG import business, backed by the July 2021 acquisition of five combined heat and power plants through its purchase of Cogen Energia Espana.
But the high upfront costs associated with taking long-term positions at terminals create challenges for most companies, particularly amid changing investment attitudes to fossil fuel projects.
Ang described Krk as a strategic asset and said MET will continue to support terminal activities and import LNG into Croatia.
The 1.9 million ton/yr floating unit started up in January 2021 and received around two cargoes per month last year. Most were imported by Hungarian state-owned gas trader MVM CEEnergy. MET brought in just one cargo.
“We will fulfill our commitments to Krk, which are substantial at the terminal," Ang said in response to a question on whether MET might hike imports into Croatia.
The terminal carried out its first small-scale ship-to-ship transfer in July and is exploring the possibility of offering ship-to-truck loading services.
“The terminal is trying to innovate and offer services to the region, as well as to us. So in a situation where your terminal operator is as commercial and ambitious as the rest of the terminal users, there is an alignment in terms of where we try to go with this region," Ang said.
Outlook for 2022
Ang said European gas and LNG markets are in uncharted territory, but the volatility present for some time offers both risks and opportunities.
“2022 will be as challenging as 2021. The market structure will continue to be the way it is, I do not really see how it would change particularly.” On the LNG side, market fundamentals have not altered much, although Asian buyers have changed their patterns and tried to buy winter cargoes earlier.
She reckons rapid changes on the piped gas side have been the major price driver so far this winter. “I do not think that LNG is going to make a huge impact on winter prices," Ang said.