According to three sources with knowledge of the situation, German utilities RWE and Uniper (UN01.DE) are close to finalising long-term agreements to purchase LNG from Qatar’s North Field Expansion project to help replace Russian gas.
Differences in important terms, such as contract length and price, have complicated negotiations between Germany and Qatar, but according to unnamed industry sources, the parties are soon likely to come to an agreement.
It would take a herculean effort for a nation that primarily depends on natural gas to power its industries, but the largest economy in Europe hopes to replace all Russian energy imports by as early as mid-2024.
Although supply agreements with Qatar would be advantageous for Germany, they would not provide a quick fix for Berlin’s energy need because the massive North Field Expansion project is not anticipated to be operational until 2026.
In May, Reuters reported that the negotiations had stalled because Germany was unwilling to sign contracts that would last for at least 20 years and wanted to tie costs to Dutch benchmark gas prices rather than oil.
According to one of the insiders, the discussions are currently more fruitful than they were a few months ago. A third source claimed that a deal might be made in a matter of weeks, while another source predicted that the utilities would agree to 15-year contracts.
Post Your Comments