Skangass Deal Shows Potential for Transporting LNG via Rail

The LNG enthusiasts are probably thrilled by some opportunities emerging in Europe, where the gas could be soon transported not only via road, but also via rail. 

On Thursday, Germany VTG Aktiengesellschaft and Norway’s Skangass AS signed the first hire contract with the option to order LNG rail tank wagons.  

“This cooperation with VTG is a great opportunity for us to shift a big part of our actual transports of LNG from road to rail,” Tor Morten Osmundsen, CEO of Skangass, commented in a note. 

From a financial perspective, the contract for 20 LNG rail tank wagons is probably not a game changer for Skangass - the company celebrated its LNG terminal in Finland a few weeks ago, and is working on a wide range of other LNG projects. Still, it indicates that LNG potentials are way larger than previously envisioned. 

Norwegian companies have a strong interest in keeping gas in the European energy mix. It comes as no surprise that Oslo is mulling CCS projects.

‘On May 4th Gassnova delivered its study on potential full-scale CCS projects in Norway to the Ministry of Petroleum and Energy. The pre-feasibility study shows that several industrial actors could be willing to continue studying the possibilites for CCS. Their interest in participating in a CCS project depends on the framework conditions established by the state’ the Norwegian government wrote on Friday.