Ukraine (bbabo.net), - Qatar will supply Germany with LNG through an American company. The US oil giant will supply Europe's largest economy with gas from the North Sea. The reduction in Russian gas supplies forced Germany to look for new sources of fuel.
QatarEnergy announced the signing of two 15-year agreements for the supply of LNG to ConocoPhillips subsidiaries in Germany. The total volume of deliveries is up to 2 million tons (about 2.8 billion cubic meters) per year. LNG will be shipped to the future German LNG terminal in Brunsbüttel, Germany from 2026.
ConocoPhillips is a partner of the Qatari state-owned company in a project to expand LNG production from 77 million tons per year to 126 million tons. The Americans have 3.125% in the development of the eastern part of the Severnoye field (South Pars) and 6.25% in the southern part.
These contracts offer attractive solutions, said ConocoPhillips Chairman Ryan Lance.
Qatar Energy Minister and President of QatarEnergy Saad Sherida Al-Kaabi added that the agreements are noteworthy for two reasons. Firstly, this is the first long-term contract for the supply of Qatari LNG to Germany. Secondly, gas will be supplied to end consumers. The divisions of the American company will trade on the German market itself.
German companies themselves have so far avoided entering into long-term contracts for the supply of Qatari LNG, as the green transition implies a reduction in fuel consumption in the medium term. Therefore, most of the LNG companies from Germany buy at the highest price - spot.
“The American company will supply gas from Qatar to the German terminal, but only in 4-5 years. And only 2 million tons per year, which corresponds to only 3% of Germany's pre-crisis gas needs. The same volume of gas via Nord Stream was delivered to the German market within 15-16 days,” said Aleksey Grivach, Deputy Director of the National Energy Security Fund (NESF).
He notes that the message does not say anything about the terms of the agreement and related contracts.
“In order for this gas to be delivered to Germany in a stable and guaranteed manner, the contract, firstly, must be concluded on the basis of DES (the seller delivers the cargo at the point of delivery), which is now a rarity. Secondly, it should be accompanied by a contract with recipients of this gas in Germany. Until then, it's just PR. But even as a PR it has a double bottom. As you know, the Germans tried to buy gas in Qatar directly. But they received unacceptable conditions from the point of view of European energy policy - a long-term contract without the right to redirect to other markets. As a result, they will be forced to buy the same gas through the mediation of the Americans, but at a higher price. With which we congratulate them, ”adds the deputy director of the FNEB.
Qatari LNG is not the only gas ConocoPhillips will trade in Germany. This summer, regulators in the UK and Norway approved the company's plan to develop the cross-border Tommeliten A field with gas reserves of almost 13 billion cubic meters. Production is scheduled to start in 2024. And if oil is transported to the UK, then gas to Germany.