Germany signs LNG deal as Chancellor visits Gulf to secure energy

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ABU DHABI, Sept 25 (Reuters) – German utility RWE has signed a deal with Abu Dhabi National Oil Company (ADNOC) to supply liquefied natural gas to Europe’s biggest economy by the end of December , RWE announced on Sunday.

Although the initial amount to be delivered is relatively small, it is a politically important deal to shore up gas supplies from outside Russia as Chancellor Olaf Scholz seeks to deepen ties with the Gulf and find alternative energy sources.

The deal, which includes a memorandum of understanding for multi-year LNG supplies, came on the second day of a two-day trip to the Gulf region by Scholz.

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“We need to make sure that LNG production around the world is advanced to the point where the strong demand that exists can be met without having to rely on the production capacity that exists in Russia,” Scholz told reporters ahead of the announcement. of the agreement. .

The cargo to be delivered this year by ADNOC will be 137,000 cubic meters of LNG and will be the first LNG to be supplied to the German gas market via the floating LNG import terminal in Brunsbüttel near Hamburg, RWE said.

ADNOC has also reserved an undetermined number of LNG shipments for Germany in 2023.

The two new floating LNG terminals planned in Germany will eventually be able to receive up to 12.5 billion cubic meters of LNG per year, or about 13% of the country’s gas consumption in 2021, according to data from the research company. Enerdata.

“This marks an important step in building an LNG supply infrastructure in Germany and establishing a more diversified gas supply,” RWE said in a statement.

German officials hope a series of deals, like the one struck with Abu Dhabi for LNG, will help mitigate soaring energy prices.

Meanwhile, frustrated Germans protested on Sunday, calling for the commissioning of the Nord Stream 2 pipeline project, which was designed to transport fuel from Russia to Germany but was frozen after the outbreak of war in Ukraine. .

“Open Nord Stream 2 immediately,” reads one sign. “Nord Stream 2 opening = Prevention,” reads another. Organizers were expecting some 5,000 protesters in the town of Lubmin, where the pipeline lands in Germany.

In addition to supplying RWE, ADNOC has also agreed to sell ammonia to German companies, including Steag and Aurubis (NAFG.DE). It will also supply 250,000 tons of diesel per month to the German company Hoyer.

Earlier on Sunday, UAE President Sheikh Mohammed bin Zayed al-Nahyan signed an agreement with Scholz that covers accelerating energy security and industrial growth.

Separately, UAE-based renewable energy company Masdar will explore the development of wind power off the German coast.

Scholz traveled to Qatar after his meetings in Abu Dhabi. On Saturday, he spoke in Jeddah with Saudi Crown Prince Mohammed bin Salman.

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Reporting by Andreas Rinke and Moataz Mohamed; Written by Tom Sims; Editing by David Evans, Emelia Sithole-Matarise and Toby Chopra

Our standards: The Thomson Reuters Trust Principles.

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