American firm takes on €500m scheme to land gas in Co Kerry

A LONG-delayed €500m terminal to import gas through the Shannon estuary is back on after US-based New Fortress Energy struck a deal to buy the company behind the scheme.

Backers say it will allow Ireland to bypass UK and Russian pipelines and import gas direct from the Middle East and the US.

Taoiseach Leo Varadkar welcomed the sale yesterday.

New Fortress has agreed to buy the Shannon LNG project at Ballylongford, close to Tarbert in Co Kerry.

The project has full planning in place for a deep water jetty, storage facilities for liquefied natural gas (LNG) and connections to the Irish national gas network.

There will be around 400 jobs at peak construction, and 100 jobs once it is operational.

The scheme ran aground three years ago when the original owner, US investor Hesse, pulled out in part because Irish regulators insisted they would have to contribute as much as €50m a year to support the cost of interconnectors linking the Irish gas network to supplies from the UK, even though they would never use them.

However, since then a European Union push to slash dependence on gas piped from Russia, and fears over the implications of Brexit, mean those charges are no longer likely to be applied.

About €70m had been invested in the project by Hesse.

The Shannon LNG scheme will see gas landed via the Shannon estuary by ship from suppliers in the US and the Middle East, bypassing UK pipes.

Hesse sold Shannon LNG to Sambolo Resources, a private Irish company controlled by Paddy Power and John Power, in November 2015, and the new owners have been seeking a buyer or backer to take on the project.

Developing the terminal is expected to cost at least €500m, but investors are likely to be able to tap matching funds from public sources.

EU authorities have designated the Ballylongford scheme a European Project of Common Interest, putting it in line for funds from the Ireland Strategic Investment Fund and the European Investment Bank.

Shannon LNG is designed to import gas through a three million tonne a year terminal, with four LNG storage tanks, each with capacity for 200,000m, and a jetty big enough to handle massive 266,000m Q-max LNG carriers – named because they are the biggest ships that can dock at Qatar’s gas terminal. There is also planning to build an associated 500MW combined heat and power plant.

“There will be around 400 jobs in construction and 100 once operational