Decision on natural gas project for the Turku economic zone to be made by year's end

Natural gas company Gasum and local energy production company Turun Seudun Maakaasu ja Energiatuotanto (TSME) have today extended their bilateral letter of intent to the end of the year. TSME and Gasum will complete a feasibility study into the construction of a natural gas pipeline and the launch of natural gas supply and decide by the end of the year whether to go ahead with the project or put it on hold. To be feasible, the construction of the pipeline running approximately 200 km would require local annual consumption of around 450 million m3.
 
”We signed letters of intent for the delivery of natural gas with TSME and Neste Oil in January 2008. With Neste Oil now pulled out of the project, we need to look elsewhere for sufficient natural gas consumption potential. We're also hoping to find natural gas users along the pipeline route," says Gasum's CEO Antero Jännes.

”The extension to the letter of intent agreed today ensures that major energy users in the Turku economic zone get one more chance to explore the opportunities for natural gas utilisation. At the same time it's obviously good to examine the other benefits offered by the project, including employment creation during design and construction phases and the opportunities provided by natural gas for the diverse development of the local economy," says Jännes. ”We must obtain certainty of the project go-ahead by the end of the year.”

According to TSME, it is now time to study the feasibility of the construction of a combined heat and power (CHP) plant planned by the company, which would match Finland's energy policy, be justified from heat users' perspective and be financially profitable.

Detail design for pipeline construction has already been completed by Gasum. If the agreement can be signed in early 2010, Gasum will be able to launch the project next spring. In practice this will mean obtaining the right to use the land areas needed under expropriation procedures. Actual pipeline construction will take place under subprojects, with the launch of the first one, the Mäntsälä-Riihimäki section, planned for 2011. This would enable natural gas supply to the Turku region to start in 2013 at the earliest, with the final schedule ultimately depending on customer needs.

Gasum will send landowners affected by the project a letter with information about current project situation and further measures after the holiday season in August.