LONDON: The government of Gibraltar has announced it has signed a Heads of Agreement with Shell Gas and Power that heralds a new era of LNG energy in the UK overseas territory.
Last month, Shell said it planned to create an LNG bunkering hub in Gibraltar to serve all ship operators bunkering in the Straits.
“Royal Dutch Shell’s proposals surpassed the [two] competing bids in meeting the Gibraltar government’s expectations…as assessed by international experts,” the government said in a statement made available to IHS Maritime, adding that it would be releasing finalised safety reports prepared by the territory’s health and safety body and Lloyd’s Register in their evaluation of Shell’s proposal.
Initially, the agreement will authorise Shell to supply gas for a new power station for the whole territory, to be located on reclaimed land on the North Mole. LNG is regarded as one of the most environmentally-friendly fossil fuels and has been adopted by the government to improve air quality in this crowded territory that is also host to large-scale commercial and military maritime traffic.
Earlier this month, Shell’s business development manager for Europe, Arjan Stavast, announced that the energy company was in negotiations with both Gibraltar and Malta to create strategic LNG bunkering hubs for the Mediterranean in the next decade.
“Shell is in negotiations with the Gibraltar government about supplying LNG to the territory and also to make Gibraltar into an LNG bunkering hub. Gibraltar is already among the top five global bunkering locations and it makes sense to site LNG bunkering in the same location,” he told delegates at an LNG conference in Barcelona in September.
Stavast told IHS Maritime that the proposal to operate a ship-to-ship LNG bunkering vessel in the Bay of Gibraltar would offer greater flexibility: “Having an LNG bunkering vessel means that you are not restricted to one port and the Gibraltar hub could serve neighbouring Algeciras as well.”
