Long-term Qatar LNG deal “good message for Germany's energy security” – chancellor Scholz

Chancellor Olaf Scholz has welcomed two contracts that are set to supply Germany with liquefied natural gas (LNG) for a duration of at least 15 years. “They are long-term agreements; that is also the good message for Germany's energy security,” Scholz said at a press conference. QatarEnergy and ConocoPhillips signed two sales and purchase agreements to export 2 million tonnes of LNG annually to Germany from 2026, Reuters reported. The deliveries would arrive at the planned import terminal in Brunsbüttel in northern Germany. Scholz called the deals “another important building block” in efforts to ensure supply as the country seeks alternatives to pipeline gas from Russia. Economy minister Robert Habeck also welcomed the long-term deal. “Fifteen years is great,” Habeck told reporters at a business conference in Berlin. “I wouldn't have had anything against 20 (years) or longer contracts.” However, the companies involved must be aware that demand in Germany will go down as it aims to become climate neutral by 2045, so that volumes might have to be sold “elsewhere in the world” at that time.

ICIS energy analyst Andreas Schröder told Tagesspiegel Background that the starting date is too late for the current crisis. “The contract is not relevant to our immediate energy crisis now and next year,” he said. Opposition CDU party leader Friedrich Merz criticised what he saw as too little too late, dpa reported. “We would now have needed supply contracts with a much higher volume,” he said. Meanwhile, Niklas Höhne of NewClimate Institute told Tagesspiegel Background that Germany should save gas and that such efforts should mean the country does not need LNG imports about five years from now. “Concluding a contract now for 15 years until 2041 stands in the way of the energy transition,” he said.  

Germany is quickly building up its own LNG import infrastructure as a reaction to the energy crisis resulting from Russia’s war against Ukraine, and halted gas deliveries from its former main supplier. The first of six planned floating terminals (FSRU) could go online before the year is over, but the onshore terminal in Brunsbüttel will take years to construct and is set to start operations in 2026. NGOs have criticised that such terminals would do little to help in the current supply crisis, could present “gigantic overcapacities” and lock Germany into fossil gas use for a long time.