ConocoPhillips and QatarEnergy ink an LNG agreement for Germany

Beginning in 2026, the arrangement will supply Germany with two million tonnes of LNG per year for at least 15 years.

The first such supply agreement for Europe from Qatar's North Field expansion project, two sales and purchase agreements have been signed by QatarEnergy and ConocoPhillips to export liquefied natural gas to Germany for at least 15 years beginning in 2026.

According to QatarEnergy's CEO, the arrangement will provide Germany with two million tonnes of LNG a year, arriving from Ras Laffan in Qatar to Germany's northern LNG port at Brunsbuettel.

In a joint press conference with ConocoPhillips CEO Ryan Lance, CEO Saad Al Kaabi stated that "[the agreements] mark the first ever long-term LNG supply agreements to Germany, with a supply period that extends for at least 15 years, thus contributing to Germany's long-term energy security."

The agreement is reached as the economic juggernaut of Europe struggles to replenish Russian gas supplies that have been interrupted due to the ongoing conflict in Ukraine. The deal's amount was not disclosed by the officials.

Moscow cut off supplies of natural gas used to heat homes, produce electricity, and power industry as European nations backed Ukraine following Russia's invasion in February. This led to an energy crisis that is causing inflation and putting pressure on businesses as prices rose.

Since the end of August, Germany has not received any LNG from Russia, despite receiving more than half of its gas from that country before the war.

The agreed-upon volumes will be purchased by a ConocoPhillips wholly-owned subsidiary and shipped by ship to the German receiving

Following the deal, German Economy Minister Robert Habeck said at a business conference in Berlin, "Fifteen years is excellent." I wouldn't have objected to contracts lasting 20 years or more.

He cited Germany's goal of becoming carbon-neutral by 2045, which would set constraints on the amount of gas the nation might import in the future.

If Germany wants to achieve its ambitious objective to combat climate change, it would have to start cutting its gas usage around the middle of the 2030s, the minister said.

In addition to temporarily restarting outdated oil and coal-fired power facilities, Germany is also extending the life of its final three nuclear power reactors, which were scheduled to be shut down at the end of this year, until mid-April.

The agreement was reached just a few days after QatarEnergy and Sinopec in China signed a 27-year sales and purchase agreement.

The North Field is a portion of the largest gas field in the world, South Pars, which Qatar and Iran jointly own.

The first and larger of the two phases of the North Field expansion plan, North Field East (NFE), includes six LNG trains that will increase Qatar's liquefaction capacity to 126 million tonnes per year by 2027 from 77 million. QatarEnergy signed five deals for NFE earlier this year.

Since Russia's invasion of Ukraine in February, there has been fierce competition for LNG, and Europe in particular needs a lot of it to help replace Russian pipeline gas, which accounted for almost 40% of the continent's imports before.

Al Kaabi stated on Tuesday that talks for additional supplies were still going on with other German businesses.