Tenerife LNG Terminal

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Tenerife LNG Terminal, also known as the Granadilla LNG Terminal, is a liquefied natural gas (LNG) terminal under construction in Santa Cruz de Tenerife, Spain. The project is presumed to be cancelled following negative rulings from Spain's Supreme Court in 2015 and 2018.

Location

The LNG terminal is located in the Canary Islands at the port of Granadilla in Tenerife, Spain.

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Project details

• Owner: Enagás
• Parent company: Enagás
• Location: Granadilla de Abona, Santa Cruz de Tenerife, Spain
• Coordinates: 28.116667, -16.566667 (approximate)
• Capacity: 1.3 bcm/y, 1 mtpa
• Cost: €300 million
• Status: Cancelled
• Type: Import
• Start Year:

Note: mtpa = million tonnes per year; bcfd = billion cubic feet per day; bcm/y = billion cubic meters per year

Background

Tenerife LNG Terminal is a LNG regasification terminal under construction in Santa Cruz de Tenerife, Spain. It was designed with a nominal capacity of 1.3 bcm/ year, to be increased to 2 bcm/year in the future.

In December 2008, Gascan awarded a consortium formed by Tecnicas Reunidas and Acciona a contract on a "lump sum turnkey" basis for the construction of the Tenerife LNG terminal and the Gran Canaria LNG Terminal.

The Tenerife LNG terminal is technically identical to the Gran Canaria LNG Terminal. It is planned to include a storage tank with a capacity of 150,000 m³, three low pressure pumps, three high pressure pumps, two lines of Open Rack Vaporizers and a back-up submerged combustion vaporizer, a flare for emergency discharges, buildings, and a jetty capable to receive LNG carriers with a capacity up to 145,000 m³. The project was expected to cost approximately €300 million. A second, similarly-sized storage tank is planned to be added in a second phase of development.

After development stalled, it was relaunched in 2012 with an expected completion date by the start of 2015 after intervention by Spanish energy minister José Manuel Soria.

In November 2014, the port of Tenerife was awarded a €400,000 grant from the European Union to conduct a year-long feasibility study on constructing an LNG bunkering hub.

In 2015 Spain's natural gas grid owner and operator Enagás acquired a 100% stake in Gascan, the terminal's original developer. Previously, Gascan had been jointly owned by Endesa (47.18%), Enagas (41.94%), and Sodecan, a public company owned by the Canary government (10.88%).

In April 2015, the Supreme Court of Spain issued judgment No. 154, resulting in the project construction being halted. The decision upheld an application by local ecologists that argued that the project developers failed to complete a full environmental assessment prior to securing planning permission. The court's decision required Enagás to reinitiate the permitting process for the Tenerife terminal. In July 2016 the project was granted a new favorable Declaration of Economic Impact.

In February 2017, Enagás announced that it still planned to invest €260 million in the Tenerife LNG Terminal. However, in October 2017, Spain's National Commission of Markets and Competition issued a report urging that the plant not be built without further evaluation of its long-term economic viability. In March 2018 Spain's Supreme Court dealt a further blow to the project, ruling against an appeal from Enagás and upholding its previous decision that the original 2012 authorization for the plant's construction granted to Gascan by the Ministry of Industry was invalid. Based on statements in subsequent company reports, Enagás appears to have shelved the project.

Opposition

Opposition groups have cited the low utilization rates among Spain's LNG terminals to call into question the necessity of such extensive LNG infrastructure. According to Food and Water Europe in 2019 (prior to the re-opening of El Musel LNG Terminal), "Since 2008, all LNG terminals (except for Mugardos) have been expanded and the total regasification capacity has increased by 8%, despite a decline in gas demand...even though the utilisation rate of Spain’s LNG regasification capacity was at only ~23% on average between January 2012 and March 2019, same as the low EU average during the same time period! The need to have so much LNG regasification capacity is questionable and best illustrated with the El Musel LNG Terminal (7bcm/y and a 300,000m³ storage capacity) which was completed in 2012 and then directly put into 'hibernation', 'until demand picks up'. The terminal has not been used since then. Despite large underutilization, Spain was the 5th biggest LNG importer with the 5th biggest liquefaction capacities worldwide in 2018, and for both cases number 1 in Europe (followed by France). Since at least 2016, Spain repeatedly imported cargoes of fracked US gas through its LNG terminals."