Italian gas group Snam has signed a contract with Golar LNG under which Golar will deliver the existing LNG Carrier "Golar Arctic" as a floating storage and regasification unit (FSRU).
Snam will install the FSRU in the port area of Portovesme, in Sardinia, as part of a project to supply the island with energy.
The contract, worth 269 million euros (~$283 million), includes the vessel and the capex for Golar to convert the Golar Arctic into an FSRU with storage capacity for up to 140,000 cubic meters. Further to the full conversion of the vessel, the FSRU will be sold to the Snam Group.
Golar said that the start of activities for the conversion of the ship into an FSRU and related fulfillments are subject to Snam's issuance of a Notice-to-Proceed (NTP) and further to that the conversion is expected to take about two years for the Golar Arctic to be delivered.
Demand for FSRUs has been growing in Europe, as they are seen as a way to quickly reduce reliance on Russian gas. FSRUs are used to regasify the liquefied natural gas imported LNG tankers, and feed that gas into the local gas grid.