PM – LNG vessel to be removed once gas pipeline in place

An LNG vessel to be berthed at Marsaxlokk Bay will sail outside the harbour, once a gas pipeline connecting the Maltese island to the European mainland is in place, prime minister Joseph Muscat said in Brussels.

There is no timeframe for the completion of a gas pipeline, although Malta will soon be tapping into an electricity interconnector to Sicily.

A report on the gas pipeline is expected to be finalised by September 2014, paving the way for Malta to start working on an application for EU funds.

But the gas pipeline project could take anything between eight to 10 years, Muscat said by way of an example, insisting that the government cannot wait any longer reduce utility tariffs.

Under Labour’s plan, a new 215MW gas plant will receive natural gas from an LNG tanker berthed inside Marsaxlokk, providing gas through a fixed price-purchase agreement with the ElectroGas consortium, which includes Azerbaijani state company SOCAR. The Delimara power station’s phase II turbines will also run on LNG.

Addressing journalists in Brussels where EU heads of states and governments have just concluded their spring summit, Muscat insisted that the LNG tanker at Marsaxlokk Bay would not pose any threat to the safety of the residents.

He said that the Maltese government had “an agreement” with ElectroGas to remove the LNG tanker once the pipeline is in place.

But this will probably take several years to occur.

ElectroGas Malta is a consortium made by Germany’s Siemens, Azerbaijan’s SOCAR, UK-based Gasol and local investor group GEM Holdings.

In talks on climate and energy earlier in the morning, Muscat expressed his satisfaction that a Maltese proposal had been included in the Council conclusions: the specific mention of the Mediterranean region as one of Europe’s main sources of energy as it opens up to third countries for new energy sources.

The recent political developments in Russia have now strengthened Europe’s resolve to diversify its energy sources and reduce its dependence on Russian gas and look for interconnections with third countries.

Muscat said Malta wants to diversify its energy sources beyond Italy and move to North Africa for a gas pipeline connectivity.

He also said the EU’s position in favour of Azerbaijan as one of the bloc’s primary source of energy was an element that would benefit Malta’s position, due to SOCAR’s involvement in the island’s energy project.

The EU is considering a gas pipeline starting from Azerbaijan, passing through Albania, and into Puglia in Italy.

Muscat also announced that an EU summit on energy in the Mediterranean region will be hosted in Malta. The summit, confirmed to take place in June, will be open to member states and countries in the Mediterranean.

“This summit fits perfectly in our plans to see Malta as an energy hub: not only to source energy from Europe but also to eventually start exporting renewable energy to Europe,” Muscat said.