LNG bunkering for Northern Tyrrhenian Sea:

Opportunities and Perspectives

Bruxelles, 15th May 2014

Francesco Campanale
[email protected]
Offshore LNG Toscana (OLT) shareholders

 E.ON Global Commodities (46.79%) – Company belonging to the E.ON

Group, one of the world’s largest private energy group, listed on the
Frankfurt Stock Exchange

 IREN Group (46.79% - Iren Mercato 41,71% and ASA Livorno 5,08%) –
IREN listed on the Italian Stock Exchange, and founded in July 2010 from
the merger between IRIDE and ENIA

 Golar LNG (2.69%) – Shipowner specialized in the management of LPG

carrier and LNG tanker fleets, belonging to the Fredriksen Group (owner
of the largest oil tanker fleet in the world)

OLT Energy  OLT Energy Toscana (3.73%) – the company that originally developed the
project

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The Project in few words…

 Conversion of the LNG carrier 'Golar Frost' into a Floating Storage

Regasification Terminal ‘FSRU Toscana’ moored 22 Kilometers from the
Italian coast between Livorno and Pisa, in sea depth of 120 meters

 EPCIC Contract awarded March 2008, Golar Frost purchased June 2008,
conversion started June 2009 in Dubai

 The FSRU Toscana left Dry-docks World Dubai on 2nd of June 2013. The
terminal arrived offshore Livorno on 30th of July 2013 ready to be moored
and commissioned

 After installation works and connection with the national gas grid through
a pipeline of 36.5 km, built and operated by Snam Rete Gas S.p.A., the
Terminal received the first cargo commencing the commissioning tests
and on 4th of October 2013 the first regasified LNG has been injected into
the national gas grid

 Since 20th December 2013 the terminal is fully operational and ready to
receive LNG carriers

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and in few pictures…
Turbo
generators
Wobbe
Thruster Index
Corrector Blister

Unloading arms Regasification Single point

plant mooring

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Key technical and commercial data
 Operations based on ship-to-ship transfer of LNG in open sea. Ship-to-Ship manoeuvres
approved for wave Hs up to 1.5 m while LNG transfer designed for wave Hs up to 2.5 m.
 Regasification unit on board for send-out with nominal capacity of 3.75 bm3/a and a storage
capacity of 137,500 m3 in 4 spherical Moss-type tanks more suitable for partially-filled terminal
in offshore environment (anti-sloshing).
 The terminal is completely self-sufficient and has the same operational features as typical
onshore regasification terminals.
 LNG loading occurs by direct transfer from LNG carriers moored side-by-side to the terminal via
traditional (Jetty) loading arms.
 Wobbe Index Corrector installed to produce Nitrogen can allow to receive most of the LNGs
types.
 Terminal is allowed to receive LNG carriers size in the range between 65,000 and 155,000 m3
(about 80% of the current worldwide LNGc fleet).
 High flexibility in send out flow rate (maximum capacity of 15 MSm3/d with a very low
minimum send out) allows high trading value to the users.
 Since 4th October 2013 all commercial (Access Code, Capacity Contracts, etc) and operational
(Cargo Handling Manual, Lng Carrier Approval Vetting Procedures, etc) documents have been
published on OLT web site.

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Operations & Maintenance Contract
Management and responsibility for all operations has been subcontracted to ECOS Srl – a joint
venture company founded in 2010 by EXMAR (60%) and Fratelli Cosulich SpA (40%)

 ECOS has sole responsibility as “Armatore’ for the terminal

 Fratelli Neri SpA provides all the marine support service:
 Custom-built Guardian Vessel with fast rescue boat
and emergency evacuation for 40 persons
 2 x Custom built tugs of 110 tones bollard pull
 Custom Built Crew Boat – max. speed 24 knots

Livorno

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European LNG outlook
Declining European LNG Imports
 Total consumption of Natural Gas into Europe fell by 10% between 2010 and 2011 and by 2%
between 2011 and 2012 due to continuing economic crisis and the situation in the power
sector.
 Also the European LNG import fell due to the drop in gas demand and the strong competition
for LNG in the global market, especially from Japan and South America.
 The percentage of European LNG imports compared to pipelines has been reduced from 24%
in 2011 to 18% in 2012.
Low level of utilization rates
 All European countries are affected: since 2011
European average (based on net import volumes) has
been reduced by more than half from 40% to about
20%.
 LNG is shipped/diverted to where the prices are the
highest, currently Asia and South America.
 Future: unknown (nuclear policy in Japan, Asian LNG
demand, new exports project from North America, Source: gle GAS LNG EUROPE

East Africa, Australia…).

… all European LNG Terminals are proposing/developing new services to meet market
needs, new requirements such as reloading, transhipment…
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European LNG outlook
Development of “new” LNG services
 Reloading: transfer of LNG from the terminal’s tanks into an
LNG carrier (offered in France and Spanish terminals, Zeebrugge
and Gate). For example in 2012 25 ship reloading have been
performed in Zeebrugge LNG terminal and 37 in the Spanish
market.
 Trans-shipment: direct transfer of LNG from one LNG carrier
to another (offered in France and Spain and from 2015 also in Transshipment at Montoir LNG terminal

Belgium).
 Small Scale LNG Services:
• Loading of bunkering ships: LNG is loaded on bunkering
ships which transport LNG in smaller quantities or used for
propulsion in substitution of diesel/MGO.
• Truck loading: LNG is loaded on tank trucks or used as
fuel. In 2012 316 truck loading have been performed in Loading of Small LNG carrier at Zeebrugge LNG terminal

Zeebrugge LNG terminal and 44.857 in Spanish market.

• Rail loading: LNG is loaded on rail trucks.

… or be available for Peak Shaving service for the

security of the national Gas System Truck loading at Zeebrugge LMG terminal
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Small Scale LNG Services

Why?
 Switching to LNG will result in significantly lower
emissions, immediately contributing to Europe’s efforts
to hit its climate targets imposing stricter requirements
and increasing taxation.
 Ships powered by LNG instead of the usual heavy fuel
oil reducing emissions by up to:

Main barriers to be overcome

 Infrastructure is not developed enough to supply ships, trucks and trains with appropriate
quantity and at the right geographical locations in order to have secure and efficient supply.
 Lacking of flag state regulation for bunkering operations, even because most authorities do
not have knowledge on the matter.
 Who is going to invest first?
• Ship-owners will not start ordering LNG fuelled ships before the relevant LNG supply
/ infrastructure / regulations / pricing are well defined and planned.
• Required infrastructure will not be planned/built if there is no certainty in demand for
LNG bunkering from shipping companies.

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FSRU Toscana as potential infrastructure for
LNG bunkering market in Tyrrhenian sea
LNG Supply Infrastructure LNG Bunkering options LNG received as fuel

Industry
LNG truck
loading station
Truck-to-ship

Onshore LNG LNG fuelled

tanks trucks
SLC-to-truck

Onshore LNG LNG Bunkerbarge

terminals

LNG Bunker Vessel

LNG fuelled vessels

FSRU

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FSRU Toscana: potential LNG bunkering operation
FSRU Toscana could use the existing port side facilities to unload the small quantities of LNG required
for LNG bunkering.

Feasibility studies, technical studies, authorizations and certifications (regarding, inter alia, mooring
operations, cargo transfer, terminal port manifold), have to be obtained according to the standard
requirements that are going to be finalized by EU by the end of 2014.
FSRU Toscana: strategic location

125 km

50 km

25 km

135 km

250 km
Olbia 320 km Civitavecchia
Strategies and initiatives for the supply
and logistics of LNG for transport

Thank you for your attention

for more information www.oltoffshore.it