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Endesa to invest up to €34.5 million in Spanish LNG supply centre

Published by , Editorial Assistant
Tanks and Terminals,

As part of its energy transition and decarbonisation strategy, Endesa has presented a project to adapt its port terminal in Los Barrios, in Algeciras, Spain, to supply liquefied natural gas (LNG) for maritime transport. To do this, it has allocated an initial investment of around €15.6 million.

After a detailed analysis, and incorporating the latest technology on the market, Ensesa will spend a total of around €34.5 million euros to adapt the facilities before 2023. After receiving authorisation from the Port of Algeciras Bay Authority (APBA) to extend the term of the concession for the current facility, the new terminal will reach a storage capacity of around 4080 m3 and an annual volume of energy managed of 1100 GWh. With this capacity, the Cádiz terminal will become the main LNG bunkering port station in Spain.

Endesa's General Director of Energy Management, Juan María Moreno, said: “The strategic location of our terminal offers opportunities for growth and diversification into new lines of business, such as LNG bunkering, which are a good fit and will enable us to make progress with our decarbonisation strategy by focusing on activities that lead to a reduction in emissions.”

The President of the APBA, Gerardo Landaluce, also highlighted the importance of this significant investment by Endesa in the region as “a commitment to sustainability and alternative energies that will allow the port of Algeciras to help reduce the carbon footprint of maritime transport and meet the objectives of the Agenda 2030.”

Each year, approximately 120 000 ships cross the Strait of Gibraltar, 30 000 of which make a stopover or anchor in Algeciras Bay. The location of the Endesa terminal has therefore become crucial since the entry into force of the new maritime transport regulations in 2020, which have changed the environmental paradigm in terms of fuel consumption. The new framework requires a reduction of the percentage of sulphur in fuel oil for maritime transport of 0.5%, making LNG the best alternative for shipowners from an environmental point of view, compared to others such as fuel oil or diesel, which were previously their main fuels. At present, LNG is the fuel that allows the greatest reduction of greenhouse gases and eliminates local pollution almost entirely. It is also foreseeable that environmental restrictions will become even stricter in the coming decades, making LNG bunkering a growth activity.

Parallel to the LNG bunkering activity, the possibility of new business lines in the terminal will extend to other sectors. The docks at Endesa's current port terminal are suitable for all types of ships of any draft, which gives the Endesa facility in Los Barrios great flexibility and versatility.

So far, Endesa has used this facility mainly to unload coal and store optical fibre and electrical connection cable. This expansion and modification will open the door to new business lines associated with LNG. In 2019, the company had a distributed energy volume of 116 611 Gwh, of which 79 784 GWh corresponded to gas sales of 79 784 GWh.

The Los Barrios terminal has additional space for possible future expansion depending on the evolution of demand (two additional docks). The facility will be able to progressively increase its storage capacity as demand and supply for LNG bunkering grows from the initial 4080 m3 to 10000 m3 during the decade, with two additional docks. It is also planned to open a gas station to supply LNG by road.

The project has already been approved in the environmental authorisation phase and has just received a ten-year extension of the port terminal concession from the APBA to get the ball rolling. The work to adapt the facility, consisting mainly of installing tanks and the pipe network, will create up to 125 jobs in the construction phase until the end of 2022.

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