Grain LNG has invited market participants to express their interest in low cost capacity at the facility from 2029.
Applicants can submit a non-binding declaration of their interest in capacity at the importation terminal until 15th August 2022, providing an opportunity for the market to indicate the quantities and duration of the contracts they would like.
This will enable Grain LNG – the largest LNG terminal in Europe – to determine the best way to proceed and the capacity products to offer participants.
As a completely independent operator, Grain provides around 40% of the UK’s LNG capacity, offering two entry points to the NBP (National Balancing Point) and “cost-effective” access to Northwest Europe.
Grain LNG currently has a series of capacity contracts that are coming to an end over the course of 2029.
It, therefore, expects to be able to offer at least 360,000m3 of storage and 300GWh per day of re-gasification capacity for start-up in 2029.
This will enable Grain LNG to offer short term contracts of five years or more, which is suggests will result in “significantly lower” cost capacity in comparison to new build terminals.
Nicola Duffin, Commercial Director at Grain LNG said: “LNG represents a vital component in the UK and global energy mix, supporting our security of supply. This looks set to continue in the context of the wider market. LNG is also an important balancing tool for intermittent renewables.
“The EOI provides a great opportunity to gauge market needs and help us to develop the packages and product offerings that meet those requirements.”
Following the assessment of responses, an auction will be determined which must be granted approval by regulator Ofgem.