Accessing Secondary Capacity

Access to Secondary Terminal Capacity

Where TAC (Terminal Access Code) or SHB (South Hook Bundle) are referenced, refer to detail provided in the Guidance Document.

Terminal Capacity

South Hook Gas, as the Base User, has acquired all firm primary capacity rights at the Terminal.

The Base User's Terminal Capacity rights comprise:

  • Firm  rights  to  berth  LNG  tankers  with  loaded  capacities  between 125,000m3  and 267,000m3 within identified arrival windows (Berthing Slots), and to unload an agreed quantity and quality of LNG
  • Firm temporary LNG storage space within the Terminal that initially matches the firm LNG quantity to be unloaded (LNG Space); and
  • Firm rights on any given day to have regasified LNG redelivered at the tailgate of the Terminal immediately prior to the entry flange to the NTS (Redelivery Capacity).

Access to Secondary Terminal Capacity

Secondary Terminal Capacity rights can be accessed (in the form of an SHB) either by agreement with the Base User, by bidding for them in a capacity auction or by way of capacity transfers with other Additional Users.

The Base User can transfer Terminal Capacity to an Additional User only as an SHB comprising a specified Berthing Slot and an amount of firm Redelivery Capacity and LNG Space for a defined SHB Period.  The Base User can also transfer firm Redelivery Capacity to Additional Users that already hold an SHB, for any Gas Day(s) in the SHB Period. The additional firm Redelivery Capacity will be added to the existing SHB.

An Additional User which holds an SHB may only transfer the whole of the SHB to another Additional User.  An Additional User cannot transfer part of the Terminal Capacity in an SHB.

In addition, all Users may on any particular Gas Day have access to purchase additional Interruptible Redelivery Capacity made available by the Terminal Operator.

Where an Additional User wishes to purchase Terminal Capacity from the Base User (or another Additional User) as a bilateral transfer, both parties to the capacity transfer must jointly notify the Terminal Operator of such transfer. The Terminal Access Code and the electronic Terminal Access and Planning System (TAPS) set out the detailed mechanism for such transfer and notification. A fee is payable by the transferee Additional User.

The Terminal Operator has set up a system which enables Users to give and receive communications to and from the Terminal Operator. The TAPS is an online access system and is the primary means of communication with the Terminal Operator.

The Base User is always liable to pay capacity charges to the Terminal Operator for its primary Terminal Capacity rights.  The Additional User is liable to pay secondary Terminal Capacity charges directly to the Base User.  All Users pay to the Terminal Operator a redelivery charge (which covers variable operating costs including emissions allowances costs) and charges for any Interruptible Redelivery Capacity acquired.

For the procedure on how to participate in a capacity auction

LNG Quality

As on the Our Terminal Facilities page, the firm daily Redelivery Capacity rate is achieved when the LNG specification is that of lean LNG production from Qatar or similar.

For each scheduled LNG unloading (and so, each SHB), an LNG composition (as to components affecting CV and Wobbe Index) must be nominated by the relevant User.  The nominated LNG composition is one of the parameters of an SHB, to be agreed with the Base User when the SHB is established. Where an SHB has a nominated LNG composition with a higher CV/Wobbe Index than lean LNG production from Qatar, the effective redelivery rate of the Terminal is reduced (this reduction is applied to the Base User's remaining Redelivery Capacity net of the transferred capacity in the SHB).

Use of Secondary Terminal Capacity

An Additional User must comply with all of the requirements of the TAC in relation to the SHBs it holds. Some of these requirements operate as preconditions to the use of Terminal Capacity under an SHB.  Such requirements include the following:

  1. Credit Requirements

    An Additional User must comply with the Terminal Operator's credit policy (set out in the South Hook Manual).  The credit requirements relate to the redelivery charge (and potentially any other amounts which the Additional User may owe the Terminal Operator).

    For each SHB, credit requirements must be satisfied no later than 15 days before the start of the SHB Period.

  2. Approved Tankers
    A User may only use an LNG Tanker which is approved by the Terminal Operator.  Vetting and approval procedures are covered in the SHM.

    Additional Users are also encouraged to submit a list of the LNG tankers they propose to use for deliveries of LNG to the Terminal and to make this submission well ahead of the arrival window for the relevant tanker. The Terminal Operator will make a charge for the vetting procedure and details of this and other terms and conditions applicable to the vetting of LNG tankers are set out in the relevant section in the SHM.

  3. NBP Deliveries
    In certain circumstances the Terminal Operator may comply with its obligation to redeliver regasified LNG on any particular day to an Additional User by delivering gas at the NBP to that Additional User (or its nominee).

    Arrangements for NBP delivery are set out in the TAC.  Additional Users must put in place standing arrangements to facilitate NBP delivery.  Under the TAC these arrangements are required to be put in place before (and as a pre- condition to) the first occasion on which an Additional User acquires an SHB.    

  4. User Requirements

    The Additional User will be responsible for arrangements for delivery of its regasified LNG into the NTS from the Terminal. These arrangements will include holding a Shipper Licence, being a party to National Grid's Network Code, acquiring the necessary NTS entry capacity, and Claims Validation arrangements.  The Additional User may itself be a shipper or make its own independent arrangements with third parties in respect of the shipping of the regasified LNG through the NTS.   Under certain circumstances the Base User may transfer NTS entry capacity to an Additional User.

 

This is produced as a guide only. The full terms and conditions for Secondary terminal capacity in the South Hook LNG Terminal are not set out in this document but will be accessible to Additional Users as set out herein. South Hook LNG Terminal Company Ltd expressly excludes any liability on its part arising from reliance upon statements in this guidance document by Additional Users. This guidance document is subject to change from time to time.