KN successfully overcame the challenges of 2017

8 January 2018

In 2017, the operator of oil and liquefied natural gas (LNG) terminals KN (AB Klaipedos Nafta) reloaded 7.177 million tonnes of oil products, with 12.646 million MWh of natural gas regasified and reloaded at the LNG terminal. The company faced challenges last year but managed to overcome them due to its ability to be aware of and respond to the needs of the market, improve the processes as well as seek possibilities to expand the range of services and adapt to changing conditions.

According to the unaudited performance results of 2017, the amount of oil product and natural gas was almost the same as in 2016. December was a remarkable month for KN – the company loaded the highest volume of oil products, which significantly boosted the annual performance results of KN. As much 834,000 tonnes of oil products were reloaded in December, a growth of 46% compared with December 2016. August was especially productive for KN's LNG terminals – the company regasified and reloaded as much as 2.176 million MWh of natural gas.

CEO of KN Mindaugas Jusius says that the main challenges were related to oil product load, especially in the first half of 2017, due to the geopolitical situation, when neighbouring countries experienced a tension and stagnation in the logistics of crude oil and oil products. However, KN determined to maintain the load level of 2016 and managed to restore the load volume in the second half of 2017 by using the current infrastructure and installing new ones for different cargoes. As CEO of KN pointed out, this achievement would not have been possible without the efforts of qualified and valuable employees of KN. The company’s staff accounted for nearly 382 employees last year.

According to CEO of KN, last year the company especially concentrated on risk assessment and quality risk management.

“The port activity is characterised by specificity, especially for such companies as KN, which reloads the production of such countries as Belarus. We are not only concerned about our own business but are also aware that our operations are affected by international relations. The latter was a source of great concern for us last year, and continues to disturb us this year. So, we try to assess all risks and seek to find the most reasonable solutions. Nevertheless, all our commercial decisions are based on business interests, rather than political ones,” said Mr Jusius, speaking about the risks in the oil product business.

The operations of the LNG terminal during the last year also contributed to the high performance results of KN. In 2017, the capacity of the LNG terminal during some periods reached as much as 90%, nearly the highest level among all LNG terminals in Europe.

“Lithuania has gained a reputation on the LNG market as a country of skilful specialists and the ability of implement projects within budget and in due time. Last year the LNG terminal supplied gas to seven countries, and gas to the terminal was shipped from four continents: Europe, South and North America, and Africa. Lithuania has a possibility to purchase gas from anywhere, at the cheapest price,” explained Mr Jusius, speaking about the benefit of the LNG to the state.

Over 2017, the balanced turnover of cargoes generated a good profit for the company and its shareholders. The preliminary sale revenues of KN amounted to EUR 106.5 million in 2017, a growth of 2.6% compared with 2016. According to the preliminary data, Klaipeda and Subacius oil terminals last year earned EUR 38.3 million (EUR 4.5 million in December, 73% more than in 2016). In 2017, the LNG terminal generated EUR 68.2 million in preliminary revenues, the same as in 2016.

“The good results of last year prove once again that teamwork and cooperation may bring the tangible benefit not only to the company but also its shareholders, society and the state. We are not only proud about the financial return. We are delighted that KN is considered an attractive employer in the region and creates stable jobs. We share our profit not only with non-profit organisations but also invest it in environmental solutions, such as recycling processes and air pollution prevention. The latter has become especially important for local communities. I want to say that a company, which conducts a socially responsible business, constantly seeks to invest in processes aimed at managing the risks of pollution. According to the monitoring results, last year volatile organic compounds, or air pollution components, did not exceed the norms provided for in legal acts,” concluded Mr Jusius, speaking about the company’s activity in 2017.

KN, press release