- Germany hopes to lock down a long-term LNG import deal with LNG powerhouse Qatar as Berlin looks to eliminate the need for Russian gas.
- Russia’s state-controlled Gazprom sold 45.8 Bcm of gas in Germany in 2020, and increased sales by 10.5% last year, implying a total of 50.6 Bcm in 2021.
- Smaller volumes were also delivered to Greece, Turkey, Croatia, the Netherlands, France, and Portugal.
As Berlin seeks to lessen its reliance on Russian gas, Germany aspires to secure a long-term LNG import arrangement with LNG giant Qatar as reported by S&P Global.
Gas deliveries
German economy minister Robert Habeck said on March 20 following talks with Qatar’s Emir, Sheikh Tamim bin Hamad al-Thani, and energy minister Saad al-Kaabi that Doha was also prepared to boost gas deliveries in the shorter term.
“Talks were not just about the short term either, but also on long-term energy policy.
Now companies need to finalize the relevant contracts.”
Qatar had discussed providing LNG to Germany “for years,” but agreements were not made “due to the lack of clarity on the long-term role of gas in Germany’s energy mix and requisite LNG import infrastructure,” QatarEnergy said in a statement.
There was no mention of the amount of LNG that Germany would look to contract, either in the statement or Habeck’s comments.
Russian dependence
Germany is the biggest buyer of Russian gas and is particularly dependent on imports from Russia to meet demand.
That accounted for some 60% of German gas demand last year.
The German economy ministry said on March 6 the floating terminal at Wilhelmshaven could be realized in two years, while the project at Brunsbuttel would require 3-3.5 years, which would give it a 2025 start of operations.
The earliest start of operations for the Stade terminal is estimated at the end-2026.
The TTF month-ahead gas price hit a new record high on March 8 of Eur212.15/MWh, according to Platts assessments by S&P Global Commodity Insights, an increase of 1,190% year on year.
Qatari supplies
Qatar is already a key LNG supplier to the European market, with deliveries totalling some 23 Bcm in 2021, according to data from S&P Global Commodity Insights, meeting around 5% of total European consumption.
Smaller volumes were also delivered to Greece, Turkey, Croatia, the Netherlands, France, and Portugal.
Asia is Qatar’s biggest market for LNG deliveries, with a total of 78.5 Bcm delivered in 2021, with India, South Korea, China, and Japan the biggest buyers.
Qatar is on track to expand its LNG production capacity from its current 77 million mt/year (106 Bcm/year) to 126 million mt/year by 2027.
Kaabi has also said that Qatar could even expand its production capacity further.
Its LNG trains are fed by the giant North Field, which is now undergoing further development.
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Source: S&P Global
