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Germany's RWE widens global search for LNG supplies

Published 11/08/2022, 12:13
Updated 11/08/2022, 12:37
© Reuters. FILE PHOTO: Markus Krebber, CEO of the German power supplier RWE, attends a news conference during the company's capital markets day at the RWE headquarters in Essen, Germany, November 15, 2021. REUTERS/Thilo Schmuelgen

By Christoph Steitz and Matthias Inverardi

FRANKFURT (Reuters) -RWE is holding talks with a larger number of suppliers of liquefied natural gas (LNG), not just Qatar and North America, CEO Markus Krebber said, as Germany's largest power producer continues its efforts to replace Russian gas volumes.

RWE earlier this year said it was in discussions with potential LNG suppliers in the United States and Qatar, as Germany tries to diversify away from Russia, its largest supplier of natural gas.

Sources told Reuters in May that talks with Qatar have proven difficult over disagreement regarding key contract clauses, most notably differences over how long supply agreements would run.

German Economy Minister Robert Habeck said last month Qatar had decided not to make a good offer and that potential importers had procured gas elsewhere for now, Bild am Sonntag reported.

"We are talking to all kinds of suppliers, and there are certainly other countries that have significant LNG export capacity," RWE's Krebber told journalist after presenting final first-half results. "The talks are ongoing."

Apart from Qatar and the United States, Australia is also among the world's top LNG exporters.

RWE, which is less affected by the reduction of Russian gas supplies than rival Uniper, said it shipped 40 LNG cargoes to Europe in the first six months of 2022, four times the amount of the same period last year.

Krebber said expanding LNG terminals was the key to improving gas supply in Europe, adding RWE would fill terminals once they have been built, including a planned floating unit in Bruensbuettel that aims to start operations in December.

© Reuters. FILE PHOTO: Markus Krebber, CEO of the German power supplier RWE, attends a news conference during the company's capital markets day at the RWE headquarters in Essen, Germany, November 15, 2021. REUTERS/Thilo Schmuelgen

"Infrastructure in Europe is at a breaking point," he said.

RWE in May unveiled plans to buy around 3 billion cubic metres of LNG per year from U.S.-based Sempra Energy (NYSE:SRE) from 2027, which Krebber said would cover RWE's share in the planned Brunsbuettel LNG terminal.

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