You're reading: Azarov: LNG terminal is big step in securing Ukraine’s energy independence

The construction of the LNG (liquefied natural gas) terminal is a real step in securing Ukraine's energy independence, according to Ukrainian Premier Mykola Azarov.

“I hail a really historic moment today, as we’ve taken the first really big step in securing Ukraine’s energy independence,” he told reporters in Kyiv on Monday, after his participation in a video conference on the start of the realization of the LNG terminal national project.

Azarov said that the terminal would be able to accept enough gas to make Ukraine an independent player on the energy market.

The total cost of the project is UAH 1.151 billion.

According to the project, a gas pipeline of 1,000-millimeter diameter and length of 65 kilometers (42 kilometers during the first stage and 23 kilometers during the second stage) will be built.

The project will be financed using funds foreseen in the tariff of Ukrtransgaz. The construction of the terminal is to be finished by 2015.

As reported, the construction of the LNG terminal in Ukraine is to be divided in two stages. The first stage (set to launch in 2016) will include a marine vessel terminal with capacity of 5 bcm of gas a year. The second stage (to launch in 2018) covers the construction of an onshore terminal able to handle 10 bcm of gas a year.

The first stage includes dredging operations (with funds raised by state-run LNG Terminal against state guarantees, at a cost of EUR 121 million). In addition, the terminal will be connected with a high-pressure gas pipeline (using Ukrtransgaz company’s funds, at a cost of under EUR 113 million) along with a vessel terminal.

The second stage will be implemented using funds from an investor consortium (EUR 735 million).

The project foresees the construction of a LNG terminal close to the town of Yuzhne near to PJSC Ukrtransnafta’s oil terminal and Yuzhny port.