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Terminal – Dick Meurs, Managing Director – Netherlands

28.01.2015 / Energyboardroom

The managing director of Gate terminal discusses the European energy mix, the evolving role of LNG, and the future of the Netherlands as the gas roundabout for the continent.


Gate terminal has just secured EUR 76 million in financing for its new LNG break bulk project. What is the scope and ambition of the project?

We were very proud to reach FID for the project in July 2014 and secure the project financing by October this year. On top of this, Shell has shown their firm commitment to the project by agreeing to be its first major customer. We were also very happy that the original financial backers of Gate terminal in terms of additional financing for the project, including EIB providing 50 percent of the additional loan. This shows us that we are going in the right direction with this new project, and its planned activities.

These activities, in reality, have already begun: we have transformed the terminal slowly from a pure import regasification terminal into a hub terminal, and we are already reloading LNG to Scandinavia. We also implemented a truck-loading bay in early 2014, and are now loading trucks for the European market. However, a dedicated break bulk facility for barges and coastal feeders is a brand new type of infrastructure, not just for the Netherlands but for the world.

The first construction has started—the Port of Rotterdam has invested and is now preparing the basin and the quay wall. So some construction work has already begun, and alongside this there are a lot of preparations on the engineering side ongoing; procurement for the key elements. The plan for the terminal to be ready at the end of Q2 2016, according to latest estimations.

Is the infrastructure in place in Europe for this move into LNG as fuel?

It’s something of a chicken and egg situation, which is why we have slowly started rolling out our offer before the break bulk terminal is completed—to gradually bring in customers and encourage the development of the necessary infrastructure.

It’s also worth considering that there are several different markets, that have different motivations for using LNG, and that will develop at different rates: road transport, the short sea market, off-grid power generation, bunkering for the shipping sector, and long-haul shipping. All of these markets have different motivations for adopting LNG, and will move at different speeds. However, the one thing they all have in common is the need to improve emissions—as long as it’s a good potential investment, and there is the drive to reduce emissions, then the market will grow.

We expect the type of contracts signed with these various segments will be a mixed bag: it all depends on what kind of infrastructure is developed, and when. Shell, for example, has already announced that it has started construction on a bunker ship to be used both in the port of Rotterdam and for coastal transports to Scandinavia. Other companies are planning to build smaller barges for LNG supply to ships in port; these could all lead to long-term contracts. I am sure as infrastructure grows, we will start to see long-term agreements.

How much of your annual throughput will be dedicated to break bulk activity?

That is difficult to predict, because we envision is a gradual buildup of volume. We have planned for different scenarios, and can be flexible. We have already seen that the truck loading bay is growing all the time: there is already a lot of demand in the continental market for LNG supplied by truck. We also see more ship activities – we are loading more coastal ships. Also, the bunker market in Rotterdam is 12 million tons– we want to try and get 10 percent of that market as a first target.

What are your perspectives on the current supply and demand situation for LNG offtake in continental Europe?

Security of supply is a hot topic in continental Europe today: this will come through diversification, increased production, the growth of unconventionals, and LNG. This was why Gate terminal was established in the first place: at the time, we brought on board five customers who committed to long-term offtake. Today, only 1 Bcm of our 12 Bcm is not allocated to long-term contracts.

Since 2011, the global LNG market has been dominated by demand in Asia, but in recent months, supply has come more into balance, and prices have leveled as a result – we believe that this will have a major impact on the future for us because currently, our regasification capacity is below 10 percent, but we expect that to increase going forward, as the price of LNG drops to closer to that of pipeline gas. 

How do you see Gate terminal’s role in the gas roundabout evolving over time?

As I just mentioned, we have not played a major role in regasification to date, but it is important for customers to have LNG as an option: this will have more of an influence if and when pipeline gas delivery to Europe slows. A new mix must emerge: as well as securing pipe gas supply, Europe must also look at increasing its storage capacity for gas, increasing connectivity, and boosting the share of LNG in the energy mix. In the end, countries need flexibility in order to react to market changes.

Which shift in policy or market dynamics would make your life easier as managing director of Gate terminal?

In Holland, we have a ‘green deal’ for LNG: an assurance (perhaps better ambition or target?) from the government that by 2015, the country will have a certain number of ships, barges and trucks running on LNG. I would like to see policies like this implemented across Europe, to boost the pace of LNG implementation, which has been recognized by many governments as a key fuel for the future. We would also like to see regulations standardized across the continent for the fuel, from excise duty to emissions standards.

Where do you expect Gate terminal to be four years from now?

Our first priority will be to successfully deliver the break bulk project on time and within budget. I would also like to see the market for break bulk evolving, and development of the market happening: in four years, a lot can happen in this regard. It would be great if in that time, LNG has been adopted as a clean alternative by the heavy transport sector. I believe that the Netherlands can be the country leading the way in this segment. The country will have an important role to play.

It is also interesting to think about the role LNG will play in the gas market in four years’ time. The consensus is that the share of LNG in the market will grow over the next few years, but the big question for all of us is by how much.


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