Klaipėda Oil to look for financial adviser to help raise 174 million euros for LNG project

The adviser’s services would be related with the prospective terminal’s funding deals, draft technical specifications published by Klaipėdos Nafta on Tuesday said.

According to the draft, funding might take various forms, including short- and long-term loans, guarantees and other financial instruments. The adviser will consult the company when choosing the most efficient instruments and sources of funding, including local and international banks, and will provide other services.

Total investments in the LNG terminal are estimated to amount to about 604 million litas over three years, of which Klaipėdos Nafta is to invest 293 million litas and the Klaipėda port is to contribute 311 million litas. According to the business plan, Klaipėdos Nafta could raise a total of 510 million litas in its own and borrowed funds in 2012 through 2014, an amount sufficient to finance the project.

Meanwhile, Eugenijus Gentvilas, CEO of Klaipėda port authority, said that the port‘s investments in the LNG terminal‘s quays could reach some 200 million litas.

Klaipėdos Nafta will soon issue a call for tenders for the design of the terminal’s quay with equipment, procurement of materials and construction. Early in July, it invited bids to design and build a pipeline linking the floating storage and regasification unit (FSRU) to the country's natural gas supply system. Moreover, the company will also call for tenders to supply gas to the facility,

Lithuania expects to build the terminal in Klaipėda by the end of 2014 to obtain an alternative to Gazprom's gas supplies and bring down prices for natural gas, which is widely used for heating purposes in the country.

About a billion cubic meters of gas is expected to be pumped via the facility in its first year of operation. In the future, its annual capacity would be 2 billion to 3 billion cubic meters.