Lithuania’s KN declares option to buy FSRU from Hoegh LNG

Lithuania’s KN, the state-owned operator of the country’s first LNG import facility in Klaipeda, has exercised its option to buy Hoegh LNG’s 170,000-cbm FSRU Independence.

KN revealed earlier this year it had decided to buy the unit for $153.5 million, excluding VAT, from Hoegh LNG at the end of its current lease deal in 2024.

After that, KN’s shareholder approved the deal. The company’s largest shareholder is the government of Lithuania with a 72.5 percent stake, followed by Achema with a 10.4 percent stake.

KN had a deadline by December 2022 to exercise its option to buy the FSRU under its current lease deal with Hoegh LNG.

Hoegh LNG confirmed in a statement on Wednesday that KN had exercised this option.

“The transfer of ownership is expected to occur in December 2024. Until then, the existing FSRU contract between a subsidiary of Hoegh LNG and KN continues unchanged,” Hoegh LNG said.

The FSRU has a regas capacity of 3.75 bcm but there are plans to boost the capacity up to 6.25 bcm due to very high demand as European and the Baltic countries look to reduce reliance on Russian gas and boost energy security.

Poland’s PGNiG and Latvia’s Latvenergo recently secured regasification capacity for a period of ten years at the FSRU-based facility in Klaipeda.

KN awarded four LNG terminal users from Lithuania, Latvia, and Poland capacity packages of 6 TWh per year, or over 0.5 billion cubic meters of gas after regasification, for a total of 24 TWh.

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