PGNiG and LOTOS: first LNG bunkering in Szczecin

On November 5th 2020, the first bunkering of a ship with liquefied natural gas (LNG) took place at a port supervised by the Maritime Authority of Szczecin. With the bunkering operation, PGNiG Obrót Detaliczny and LOTOS Asfalt have expanded the scope of their cooperation, which helps to strengthen the role of Polish ports and promotes LNG fuel in the Baltic Sea.

'We have carried out tens of LNG bunkering, or refuelling, operations with Grupa LOTOS so far. We are pleased that the service is gaining popularity and that it can now be provided in other Polish ports besides Gdańsk and Gdynia. We believe that LNG fuel is the future of maritime transport in the Baltic Sea. Our business relationship with Grupa LOTOS in this area is a good example justifying the existence of the multi-utility group we will soon be a part of,'said Jarosław Wróbel, acting President of the PGNiG Management Board.

'Energy transition motivates us to step up our efforts in the field of alternative fuels. One of our development directions is LNG, a green and safe fuel. In order to promote this market segment, we need to develop logistics and LNG bunkering infrastructure. Grupa LOTOS is analysing various projects in this area. The company has recently completed a feasibility study for a project to build a small-scale LNG transshipment terminal in Gdańsk, which has already entered the internal corporate decision-making stage,'explains Paweł Jan Majewski, President of the Grupa LOTOS Management Board.

The LNG bunkering operation was performed at the wharf of the Port of Szczecin with the use of cryogenic LNG tankers. The LNG fuel was pumped into the tanks of the ship Scheldt River, which is working to deepen the Świnoujście-Szczecin waterway to enable Szczecin to accommodate vessels twice the size of the ships that currently call at the port. Worth over PLN 1.44bn, this strategic project is funded from the Cohesion Fund and the state budget.

Grupa LOTOS and PGNiG have worked together on LNG projects for several years now. Also, PGNiG supplies Grupa LOTOS with natural gas, which is used in petroleum refining processes.

'We can see demand for bunkering services from shipowners at Polish ports grow, driven by a rising awareness that LNG, as an alternative marine fuel, is the sole mature solution that is capable of meeting the existing and future emission standards while being economically viable,' noted Henryk Mucha, President of the PGNiG Obrót Detaliczny Management Board.

'LNG bunkering services naturally complement the range of low-sulphur marine fuels offered by LOTOS Asfalt to its customers. Shipowners are increasingly adding dual-fuel vessels to their fleets, and our goal as a supplier is to provide them with a complete range of bunkering services. Our collaboration with PGNiG in the field of LNG is beneficial to both companies. We believe it has potential for further development considering the emission reduction regulations implemented globally,'added Cezary Godziuk, President of the LOTOS Asfalt Management Board.

PGNiG Obrót Detaliczny is a PGNiG Group company providing LNG bunkering services at five ports in Poland (Szczecin, Świnoujście, Police, Gdynia, and Gdańsk). The company has performed bunkering operations for 12 different vessels so far, which means it has one of the best track records in this part of Europe.

'I would like to strongly emphasise the exemplary cooperation with the Maritime Authority of Szczecin, Zarząd Morskich Portów Szczecin i Świnoujście, and Zakłady Azotowe Police. This marks a very important step towards advancing the LNG market at Polish seaports that will help to significantly increase their competitiveness in the coming years,'said Marcin Szczudło, Vice President of the PGNiG Obrót Detaliczny Management Board.

The increasingly widespread use of LNG in the coming years will be driven by a number of factors, including the Sulphur Directive, which means that standards applied in Central and Eastern Europe are more stringent than in other parts of the world. The Sulphur Directive requires shipowners whose vessels sail in Sulphur Emission Control Areas ('SECAs'), e.g. the Baltic Sea and the North Sea, to use fuels with a sulphur content of less than 0.1%.