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GERMANY AND RUSSIA

Germany’s Scholz accuses Russia of blocking gas turbine delivery

German Chancellor Olaf Scholz on Wednesday accused Russia of blocking the delivery of a turbine needed to keep gas flowing via the Nord Stream 1 pipeline to Europe.

German Chancellor Olaf Scholz (SPD) with Christian Bruch, CEO of Siemens Energy, at the turbine serviced in Canada for the Nordstream 1 natural gas pipeline in Mülheim an der Ruhr.
German Chancellor Olaf Scholz (SPD) with Christian Bruch, CEO of Siemens Energy, at the turbine serviced in Canada for the Nordstream 1 natural gas pipeline in Mülheim an der Ruhr. Photo: picture alliance/dpa | Bernd Thissen

As the continent’s biggest economy scrambled for energy sources to fill the gap left by Russia’s throttling of supplies, Scholz also opened the door to keeping Germany’s remaining nuclear plants running.

Standing next to the turbine, currently stuck with maker Siemens Energy in Germany, Scholz said the unit was “available and working”.

“There is no reason why this delivery cannot happen,” Scholz said.

The turbine had received “all the approvals” it needed for export from Germany to Russia, he said.

Pipeline operators only needed to say that “they want to have the turbine and provide the necessary customs information for transport to Russia”, Scholz said.

Transferring the missing unit to Russia was “really easy”, he added.

Russian energy giant Gazprom has blamed the delayed return of the unit from Canada, where it was being serviced, for the initial reduction in deliveries of gas via the Nord Stream 1 gas pipeline.

READ ALSO: How much extra will German households pay under new gas surcharge?

Officials in Berlin worked with their counterparts in Canada to expedite the return of the turbine but the unit has yet to reach its final destination.

Deliveries via the undersea energy link were reduced to around 20 percent of capacity in late July, after Gazprom halted the operation of one of the last two operating turbines due to the “technical condition of the engine”.

Germany, which is heavily dependent on Russian gas, has branded the decision to limit supplies as a “political” response over the West’s support for Ukraine.

Scholz said Moscow’s move to limit supplies sent a “difficult message” to the world by creating doubt over Russia’s commitment to its agreements.

Nuclear debate

Germany has been working to wean itself off Russian energy imports since the invasion of Ukraine in February.

But the reduction of gas supplies has left Europe’s largest economy facing potential shortages over the winter, leading to calls for Germany’s nuclear power plants to be kept online beyond the end of the year.

Scholz said Wednesday that it “can make sense” to keep Germany’s remaining three nuclear plants running, despite a long-planned stop at the end of the year.

The government has said it will await the outcome of a new “stress test” of the national electric grid before determining whether to stick with the phaseout.

“As far as the energy supply in Germany is concerned, the three last nuclear plants are relevant exclusively for electricity production, and only for a small part of it,” Scholz said.

The plants, scattered across the country, account for six percent of Germany’s electricity supply.

The government has said it will await the outcome of a new “stress test” of the national electric grid before determining whether to stick with the phaseout.

Extending the lifetime of the plants has set off a heated debate in Germany, where nuclear energy has long been controversial.

The question has split the governing coalition, with Scholz’s Social democrats and the greens hitherto sceptical, and the FDP favouring an
extension.

Germany has already moved to restart mothballed coal power plants to guard against an energy shortfall.

The first of these was already “supplying electricity to the network”, Scholz said Wednesday, adding that Germany had to prepare for a “difficult

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ENERGY

Qatar agrees to ‘long-term gas supply’ deal with Germany

Qatar has agreed to send Germany two million tons of liquefied natural gas a year for at least 15 years, officials said Tuesday, as Europe's biggest economy scrambles for alternative supplies after Russia's invasion of Ukraine.

Qatar agrees to 'long-term gas supply' deal with Germany

Qatar’s Energy Minister Saad Sherida al-Kaabi said up to two million tons of gas a year would be sent for at least 15 years from 2026, and that state-run QatarEnergy was discussing other possible deals for Europe’s biggest
economy.

Kaabi, who is also QatarEnergy’s chief executive, said so many European and Asian countries now want natural gas that he did not have enough negotiators to cope.

The talks for the latest deal took several months as Germany has resisted the long-term contracts that Qatar normally demands to justify its massive investment in the industry.

Russia’s invasion of Ukraine in February increased pressure on the German government to find new sources. And the latest deal will not help the country get through the looming winter.

The gas will be bought through US firm ConocoPhillips, a long-term partner with QatarEnergy, and sent to a new terminal that Germany is hurrying to finish at Brunsbuttel.

“We are committed to contribute to the energy security of Germany and Europe at large,” Kaabi told a press conference after the signing ceremony with ConocoPhillips chief executive Ryan Lance.

Lance hailed the accord as “a vital contribution to world energy security”.

READ ALSO: EXPLAINED: What are Germany’s alternatives to Russian gas?

Qatar last week announced a 27-year agreement to ship four million tons a year to China. It said this was the longest contract agreed in the industry.

Qatari officials would not discuss prices but industry analysts have said Germany will have to pay a premium for the shorter contract and the hurried start to deliveries.

Intense demand

Kaabi again stressed the “sizeable investments” that his country has made in extracting gas for deliveries around the world.
But he also said that Qatar was negotiating with German companies to further increase the “volumes” being sent.

The gas will come from the North Field East and North Field South projects that Qatar is developing with ConocoPhillips and other energy multinationals.

North Field contains the world’s biggest natural gas reserves and extends under the Gulf into Iranian territory.

Through expansion in North Field, Qatar is aiming to increase its production by 60 percent by 2027. With increases in international prices, the value of its exports has almost doubled in the past year, state media said
recently.

Asian countries led by China, Japan and South Korea have been the main market for Qatar’s gas, but it has been increasingly targeted by European countries since Russia’s war on Ukraine threw supplies into doubt.

“There is very intense discussions with European buyers and with Asian buyers,” Kaabi said, highlighting the “scarcity of gas coming in the next few years”.

“We do not have enough teams to work with everybody, to cater for the needs” of all countries making demands.

Kaabi said the deal with China’s Sinopec showed that “Asian buyers are feeling the pressure of wanting to secure long-term deals… I think we are in a good position.”

The Brunsbuttel terminal supplies customers of German energy companies Uniper and RWE, and Economy and Energy Minister Robert Habeck said the two firms “have to buy on the world market.

“It is clear that the world market has different suppliers, and it is smart from the companies to buy the most favourable offers for the consumers on the world market, and that includes Qatar.

“But this is not the only supplier on the market.”

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