Europe: LNG Terminal Developers Face Mounting Costs

Import terminals in northern Europe and the Mediterranean have provided a fresh round of industry cost markers, with the news being far from good for either project developers or capacity holders. Terminals in the latest construction wave are showing capital costs per unit of sendout capacity that are double the levels seen just a few years ago, leaving new market entrants facing significantly higher throughput tariffs. Costs on the engineering, rocurement and construction side as well as developer’s own expenditures have risen sharply. This could undermine efforts to attract LNG supply away from alternative markets not only in Asia and North America but also from existing terminals in Europe that are already fully depreciated and have lower cost structures. Download here