Commercial Advantages

The Port Meridian deepwater port offers low cost and flexible access to the UK gas market. Port Meridian allows prospective capacity holders to offload standard vessels via Side-by-Side offloading into a regas vessel moored on site which is equipped to regas the LNG directly into the UK market.

With all major approvals and consents in place for Port Meridian, the project has entered its commercialisation phase. In this respect, Port Meridian Energy Limited, (a wholly owned subsidiary of Höegh LNG) has initiated an extended marketing campaign towards interested parties for long term regas capacity in Port Meridian. Part of this campaign is inviting the interested parties to reserve capacity in Port Meridian. Final Investment Decision (FID) is expected by late 2011 and first gas in October 2014.

The gas market entry point at Barrow-in-Furness in North West England is at present underutilised, so the cost of entry capacity is very competitive compared to other UK terminals.

The competitive cost structure of Port Meridian compared to UK onshore terminals, would allow prospective regas capacity holders at Port Meridian a commercial advantage in terms of attracting LNG and selling natural gas into the UK market.

The number of regas capacity holders at Port Meridian is expected to be low, which would allow for smoother operation and more commercial flexibility, which in turn will help maximiseutilisation of regas capacity.

Furthermore, the regas vessel is expected to be a tradable LNG vessel in its own right which decreases the commercial risk for prospective capacity holders, as the regas vessel can either be used elsewhere or traded as a standard LNG vessel if the UK gas market is commercially unattractive for a longer period of time.