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Ukraine to build new LNG terminal

13th August 2012

Billion-dollar LNG project could see Kiev reduce the cost of gas imports from Russia by 15-20 per cent.

Ukraine to build new LNG terminal
The terminal is expected to reach a final capacity of 10 billion cubic meters of liquefied gas per year, just over half the amount of gas the country imported in the first half of 2012, 19 billion cubic meters

Ukraine in 2013 will begin construction of a new LNG terminal as part of multi-billion plans to reduce the cost of gas imported from energy rich Russia, it emerged on Friday.

Kiev has approved afeasibility study for the construction of a new terminal, Ukrainian energy and coal industry minister Yuriy Boyko said. The facility will be built in the Odesa oblast, Black Sea in southern Ukraine.

The terminal is expected to reach a final capacity of 10 billion cubic meters of liquefied gas per year, just over half the amount of gas the country imported in the first half of 2012, 19bn cubic meters.

The project is set to decrease the price of imported gas by some 15-20 per cent, according to estimates from the State Agency for Investment and National Projects of Ukraine.

It will also allow Ukraine to import gas from North African and Middle Eastern countries, Naftogaz said. In addition, Ukrainian officials are holding negotiations with Algerian, US and Qatari firms for potential gas supplies once the LNG terminal becomes operational.

Construction of the terminal will begin in 2013, and by 2015 the facility will be able to process 5bn cubic meters of gas per year.

The country currently pays USD 426 for every million cubic meter of Russian gas and is responsible for the transportation of 70 per cent of Russian gas to Europe, equivalent to 178.5bn cubic meters per year, the country’s national oil and gas company Naftogaz said.

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