KN & Orlen Lietuva Start Diesel Loading Operation at Marijampole Oil Terminal

Source: 6/5/2023, Location: Not categorized

The developer and operator of petrochemical and liquefied natural gas (LNG) terminals KN (AB Klaipedos Nafta) and AB ORLEN Lietuva have entered into a collaborative agreement for diesel loading operations at KN's leased Marijampole Oil Terminal, which infrastructure consists of 2 tanks with a total capacity of almost 7, 000 cubic meters.

Darius Šilenskis, the CEO of KN, says that the need for additional capacity at the Marijampole Oil Terminal was dictated by the increased volumes of oil products transported towards western destinations.

"The supply chain for oil products has changed completely since Russia started the war in Ukraine. Some products are transported from Lithuania to Ukraine, but due to the different track gauges, conventional rail transport cannot be used. We provide our customers with fuel loading services for rail wagons and ISO containers. However, this method of fuel delivery is limited due to the different track gauges and the busy nature of the entire logistics chain," notes D. Šilenskis.

For these reasons a significant part of the fuel from Lithuania to Ukraine is transported by tanker trucks. The Klaipeda Oil Terminal's tanker yard is not able to offer such a service due to its high occupancy rate and contractual obligations with existing customers.

As a result, customers find it more attractive to import fuel to Ukraine by tanker truck. However, due to high occupancy rates and contractual obligations with existing customers, the KN Klaipeda Oil Terminal tanker yard cannot offer this service.

Considering these circumstances and needs of ORLEN Lietuva, it was decided to offer oil product handling services at the Marijampole Oil Terminal, from which tanker cargoes will be able to reach Ukraine more efficiently, not only because of the decreased congestion in the logistics chain, but also due to the Marijampole terminal's strategic location, resulting in shorter distances to be covered.

As part of the cooperation agreement, KN has assumed the role of commercial operator at the Marijampole Oil Terminal, setting up an excise warehouse at the terminal. The main user of the terminal will be ORLEN Lietuva, which will handle the loading of diesel from rail to tankers.

“AB ORLEN Lietuva's product exports to Ukraine are recovering rapidly. In Q1 2023, 93% more products were sold to the Ukrainian market than in Q1 2022, after the outbreak of the war," said Michal Rudnicki, CEO of ORLEN Lietuva. - "We aim to increase sales volumes in this direction and create more favorable loading conditions for our Ukrainian customers. To this end, we have concluded a cooperation agreement with KN on the use of the Marijampole Oil Terminal. The availability of an alternative loading point will help to meet the diesel demand of Ukrainian customers more efficiently. This product is needed not only for diesel-powered light and heavy transport, but also for generators used in the event of power cuts”.

KN, which has become a tenant of the Marijampole Oil Terminal, currently operates two oil terminals in Klaipeda and Subacius, and is the operator of LNG terminals in Lithuania and Brazil. In addition, KN has been appointed as the commercial operator of the floating LNG terminal in Wilhelmshaven, Germany, and has been selected by the Italian energy company Snam FSRU Italia to collaborate on a project for a greenfield FSRU-based LNG terminal in the port of Piombino.

Gulf Oil and Gas
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