Rotterdam-based storage terminal owner VTTI, co-owned by Vitol, IFM, and Adnoc, has entered into a deal with infrastructure manager, Ancala, to buy its 50 percent shareholding in the Dragon LNG terminal in the UK.
Besides Ancala, UK-based LNG giant Shell has a 50 percent stake in Dragon LNG.
VTTI did not provide the financial details of the deal in a statement issued on Wendesday.
Also, the transaction is subject to customary conditions and is expected to close in the third quarter of 2024, it said.
Dragon LNG’s regasification terminal is one of the three LNG terminals in the UK.
The facility can achieve maximum sendout to the UK national transmission system of up to 9 billion cubic meters, supplying about 10 percent of the UK’s annual gas demand, according to Dragon LNG.
The terminal’s infrastructure includes a jetty and two 160,000-cbm storage tanks.
Dragon LNG received its first cargo in July 2009.
Shell and Petronas have 50 percent capacity rights at the facility, each. The Malaysian company sold its 50 percent share in the facility to Ancala in 2019, but it kept a long-term throughput agreement with the terminal.
Dragon Energy, a unit of Dragon LNG Group Limited, has also developed a solar farm at the facility and is developing additional renewable power projects at the site.
VTTI’s LNG expansion
Prior to this move, VTTI joined forces with German asset manager IKAV to buy a majority stake in Italy’s Adriatic LNG terminal.
Upon closing of the transaction, the corporate capital of Adriatic LNG will be held by VTTI at 70 percent and Italy’s Snam at 30 percent.
“As part of VTTI’s strategy 2028, we are committed to expanding and enhancing LNG regasification infrastructure globally,” Guy Moeyens, CEO of VTTI, said.
“Our aim is that half of our portfolio will be in transitional and sustainable energy sources by 2028,” he said.
Following the recent agreement in Italy and the ongoing development of a new LNG import facility in Vlissingen in the Netherlands, this acquisition “reflects our commitment to diversify into LNG as a transitional energy source,” Moeyens said.