August 09, 2024 [Storage Terminals Magazine]- VTTI, a leader in energy infrastructure, has successfully completed the acquisition of a 50 percent stake in Dragon LNG Group Limited, also known as Dragon LNG. The remaining 50 percent of the terminal is owned by Shell. This acquisition follows the announcement made on May 8, 2024, regarding VTTI’s intention to acquire the stake from Ancala, a prominent infrastructure manager.
As part of its Strategy 2028, VTTI aims to enhance its role as an energy storage and service terminal operator at key ports worldwide. The company is focusing on investing in and developing additional energy infrastructure necessary for the energy transition. This includes liquefied natural gas regasification terminals, renewable natural gas and waste-to-value production facilities, as well as biofuel storage and ammonia and hydrogen infrastructure.
VTTI aims for 50 percent of its earnings to derive from transitional and sustainable energy sources by 2028, underscoring its commitment to accelerating growth.
The acquisition of Dragon LNG marks VTTI’s second investment in LNG regasification terminals, following the announcement in April 2024 of its intention to acquire a 70 percent equity stake in Adriatic LNG in Italy, which is expected to close by the end of 2024.
Guy Moeyens, CEO of VTTI, stated, “Facilitating the import and distribution of LNG aligns with VTTI’s strategy to support the global energy transition and ensure security of supply. As an energy infrastructure company with extensive storage industry experience, we are well-positioned to develop, operate, and manage LNG terminals worldwide. We look forward to working with Shell to ensure that Dragon LNG continues to operate safely and reliably while advancing its decarbonisation and growth initiatives.”
Dragon LNG’s regasification terminal is one of three LNG terminals in the UK, situated near Milford Haven in Wales. The facility includes LNG receiving, storage, reliquefaction, regasification, and send-out capabilities, with a maximum gas send-out capacity of up to 9 billion cubic metres, which supplies approximately 10 percent of the UK’s annual gas demand.
Dragon Energy Limited, a wholly-owned subsidiary of Dragon LNG Group Limited, has also developed a solar farm at the facility and is pursuing additional renewable power projects to support the decarbonisation of scope 2 emissions at the LNG terminal. Recently, the company announced the Milford Haven CO2 project, which will be executed in collaboration with RWE Pembroke Net Zero Centre. This initiative will explore carbon capture, pipeline transfer, liquefaction, temporary storage, and ship loading to facilitate CO2 shipping from a new Dragon jetty to sequestration sites across the UK.
Simon Ames, managing director of Dragon LNG, expressed enthusiasm about VTTI joining as a key shareholder alongside Shell, stating, “This partnership will strongly support our ongoing commitment to operational excellence and sustainable growth. By integrating VTTI’s expertise in energy infrastructure, we can further enhance the safety, reliability, and environmental performance of our terminal, ensuring our customers continue to provide secure and flexible energy supply into the UK. I am tremendously excited for our future through the energy transition as we look to further decarbonise and build a brighter future for our employees, business partners, and the community here in Milford Haven and throughout Wales.”
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