“It is necessary to reduce our dependence on Russian gas as quickly as possible” in light of Moscow’s aggression, Economy and Climate Minister Robert Habeck said in a statement.
Germany was financing the project in Brunsbuettel, northern Germany, via the public lender KfW, together with the state-owned Dutch gas company Gasunie and German energy group RWE.
The process of liquefaction makes LNG easier to transport, allowing it to be imported by sea from producer countries that cannot be connected by pipelines, such as the United States or Qatar.
Before the outbreak of war, Germany imported 55 percent of its gas from Russia, via pipelines running through Ukraine, Poland and under the Baltic Sea.
The Russian invasion of Ukraine forced a strategic reassessment in Berlin, with Germany hoping to substitute Russian gas supplies with LNG.
Currently, Europe’s largest economy does not have any LNG terminals, having planned on expanded pipeline supply from Russia over the past two decades.
But in the immediate run-up to the invasion, the government said it would halt the approval process for the completed Nord Stream 2 pipeline under the Baltic, which would have increased direct supplies from Russia.
Gas plays an important bridging role in Germany’s planned transition to renewable energy, providing a flexible source of energy when the wind is still or the Sun does not shine.
The new terminal, at the mouth of the Elbe River on the North Sea coast, will have a regasification capacity of eight billion cubic metres per year, according to the statement, before later being “repurposed for the import of green hydrogen”.
The German government will take a 50-percent participation in the terminal, which will be operated by Gasunie.