ByCharles Kennedy– Mar 18, 2025, 10:30 AM CDT
Despite high natural gas prices and increased LNG demand in Europe after the end of Russian pipeline gas, floating LNG import terminals in France and Germany have sat idle for months as the high cost of operating the floating units undermines their competitiveness compared to onshore facilities.
One example of this situation is the Le Havre floating terminal, commissioned by France’s TotalEnergies in 2023 as part of emergency measures in response to the energy crisis following the Russian invasion of Ukraine.
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The Cape Ann, the floating storage and regasification unit (FSRU) for liquefied natural gas was located in the port of Le Havre two years ago. TotalEnergies has contracted 50% of the terminal’s annual capacity of around 5 billion cubic meters, to supply it with LNG from its global portfolio. The remaining capacity will be marketed according to rules approved by the regulator, the French supermajor said in 2023.
However, this floating terminal at Le Havre handled only 2% of all French LNG imports in 2024, although it has the capacity to import as much as 10% of the total French gas consumption, vessel-tracking and port data compiled by Bloomberg showed on Tuesday.
Even the company that commissioned the floating terminal, TotalEnergies, didn’t use Le Havre much. The last LNG cargo to arrive at the floating terminal was one shipment in June 2024, according to the data compiled by Bloomberg.
The key reason for the low utilization rate has been the high operational and regasification costs for floating units—higher than those for the onshore LNG terminals elsewhere in France, including Dunkerque, Fos Cavaou, Fos Tonkin, and Montoir-de-Bretagne.
Germany’s floating LNG import terminals have also suffered from low utilization rates compared to onshore import facilities, according to Bloomberg.
Germany has installed several floating LNG import terminals since 2022—to make Europe’s biggest economy “independent of Russian gas”.
In a sign of the struggles with floating LNG import units, German LNG import terminal firm Deutsche ReGas is said to have canceled a floating storage regasification unit used for a year, saying it was losing money on the investment.
By Charles Kennedy for Oilprice.com
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