A floating terminal for LNG should start operation by the end of this year, the CEO of utility Uniper, said on Nov. 30, as Germany seeks to find supplies to replace Russian fuel.
“The only thing that could stop it would be [adverse] weather,” CEO Klaus-Dieter Maubach told a conference organized by the Institute of Energy Economics of Cologne University (EWI).
Germany has been racing to secure new supplies following the disruption of Russian gas that has followed the Ukraine war begun in February.
A long-term LNG supply deal from 2026, struck on Nov. 29 for Germany, was made possible by the sheer size of ConocoPhilips’ market cap, Maubach said.
Its capitalization is around $155 billion, Refinitiv Eikon data shows.
Maubach said Germany, which lacks hydrocarbon giants of ConocoPhillips’ scale, needed to learn to maneuver in the international LNG market.
RELATED:
ConocoPhillips, QatarEnergy to Supply Germany with LNG Starting in 2026
The market has different contract and pricing rules from those of the one on which Germany previously relied when Russia supplied 50% of its gas via pipelines.
The international LNG market will mean accepting higher prices, and making choices about long-term commitments, or risking exposure to possibly expensive spot market supplies, he said.
Unlike financially strong global oil majors, Uniper’s finances have been shattered by the impact of the Ukraine war.
It is subject to a state bailout after its imports from Russia stopped, requiring spot purchases at elevated prices to cover its contractual obligations.
A week ago, Uniper asked for more money from the state, raising the tally for Uniper’s nationalization to more than 51 billion euros (US$53 billion).
“If the state had not helped Uniper, and [sector peer] Sefe, it would have caused a domino effect, a Lehman crisis moment for the German, if not European gas supply,” Maubach said.
Lehman Brothers collapsed in 2008 in the sub-prime mortgage crisis, ushering in a global finance crisis.
Uniper investors will vote on the proposed deals to support it at an extraordinary general meeting on Dec. 19.
(US$1 = 0.9661 euros)
Recommended Reading
Apache CEO: Longer Laterals Expected as Permian Enters New Era
2024-05-17 - With more than a decade of development in the Midland and Delaware basins, there are more limitations that operators will have to work around, said Apache Corp. CEO John Christmann at Hart Energy's SUPER DUG Conference & Expo.
Enverus: Permian Gains Will Sustain US Oil Production Through 2030
2024-05-09 - Crude output gains from the Permian Basin will keep U.S. oil production relatively flat entering the 2030s, offsetting declines from mature oily basins, according to Enverus Intelligence Research.
Gulfport Plans Liquids-rich Program After ‘Strong’ Ohio Oil Tests
2024-05-01 - Appalachia gas producer Gulfport Energy continues to report “strong oil production” from a two-well Hendershot pad drilled in eastern Ohio last year. Gulfport plans to develop additional liquids-rich opportunities this year as natural gas prices hover near record lows.
Decoding the Delaware: How E&Ps Are Unlocking the Future
2024-05-01 - The basin is deeper, gassier, more geologically complex and more remote than the Midland Basin to the east. But the Delaware is too sweet of a prize to pass up for many of the nation’s top oil and gas producers.
Chevron CEO: Permian, D-J Basin Production Fuels US Output Growth
2024-04-29 - Chevron continues to prioritize Permian Basin investment for new production and is seeing D-J Basin growth after closing its $6.3 billion acquisition of PDC Energy last year, CEO Mike Wirth said.