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Berlin welcomes 'super' 15-year LNG gas deal with Qatar

November 29, 2022 at 7:16 pm

Tanks onboard the LNGT Powership [Dwayne Senior/Bloomberg via Getty Images]

Germany’s Economics Minister on Tuesday welcomed the term of an agreement with Qatar on deliveries of liquefied natural gas to Germany, calling it “super”, Anadolu News Agency reports.

“Fifteen years is great,” said Robert Habeck, at an industry conference in Berlin, adding that the duration could also have been an even longer contract.

Referring to the 15-year term, he said Germany wants to become climate neutral by 2045.

Habeck, who was in Qatar in March, declined to comment on details of the deal, saying that it is a business matter.

According to Qatar’s Energy Minister, Saad Sharida Al-Kaabi, the energy giant, Qatar Energy, has concluded an agreement on liquid gas deliveries to Germany.

READ: Qatar awards major LNG field expansion project contract

The gas would be sold to the US company, Conoco Phillips, which would then deliver it to the north German town of Brunsbuttel, he said in the Qatari capital, Doha.

Delivery is scheduled to begin in 2026 and run for at least 15 years as up to 2 million tons are to be delivered annually.

Meanwhile, Germany’s gas industry sees the agreement on the delivery of liquefied natural gas from Qatar to Germany as a “positive signal for land-based LNG terminals”.

The long-term deliveries over 15 years from 2026 will open up good prospects for these terminals, said Timm Kehler, Chair and CEO of the industry association, Zukunft Gas, according to a statement.

According to Zukunft, the amount agreed between Qatar and Conoco Phillips corresponds to around 30 terawatt hours and thus around 3 per cent of Germany’s annual requirement.

“However, we have to replace almost 500 terawatt hours that have so far been covered by Russian gas supplies,” said Kehler.

“This means that there is still a lot of work ahead of us to secure the supply in the long term,” he added.

Germany is facing a severe energy crisis due to the ongoing Russia-Ukraine war, which led to disruptions in the gas supply and pushed energy prices to record highs.

The government is seeking to diversify natural gas supply sources, and currently work is under way to build liquefied natural gas (LNG) terminals at the northern German ports of Brunsbuttel, Wilhelmshaven, Stade, and Lubmin.

Before the start of the war in Ukraine, Russia was supplying 55 per cent of Germany’s natural gas.

READ: Purchase of Qatar LNG not off the table, says German Chancellor