November 24, 2023 [Offshore Energy]- Energy conglomerate ČEZ Group has contracted a long-term annual capacity of 2 billion cubic meters at the LNG Stade terminal in Germany, strengthening the energy security of the Czech Republic.
The capacity at the terminal has been leased for 15 years, with an option to extend this to 25 years in connection with the future use of green hydrogen.
At the same time, the Czech Republic Ministry of Industry and Trade supported the transaction by concluding a hedging agreement with ČEZ Group.
The Stade terminal, one of the onshore LNG terminals in Germany, will be located near Hamburg at the mouth of the Elbe River on the North Sea and will be commissioned by its operator, Hanseatic Energy Hub (HEH), in mid-2027.
The terminal’s total capacity is 13.3 billion cubic meters of gas per year, of which 1.3 billion is intended for short-term contracts.
The Stade terminal is currently under construction and will replace the floating one at the same location. According to ČEZ Group, the advantages of onshore terminals over floating ones include higher capacity and faster LNG unloading and regasification.
It is said that from 2027, the terminal will enable the importing and regasification of LNG, while later it will be possible to convert the terminal to import and process climate-neutral ammonia, from which green hydrogen can be produced.
Commenting on the deal, Czech Prime Minister Petr Fiala said: “We promised to our citizens that we would strengthen the energy security of our country. We promised this as a government, and I defined it as one of the fundamental prerequisites for restarting Czechia. We have already taken several concrete steps, now we are adding another important piece of the mosaic.”
“After acquiring the capacity of the LNG terminal in the Netherlands, we managed to secure capacity in the German terminal Stade as well. Together with the purchase of gas storage tanks and pipelines, we are fundamentally increasing the possibilities of transportation and storage of natural gas from reliable suppliers, and at the same time we are fulfilling the policy statement of the government and my personal vision of Restart Czechia.”
ČEZ CEO Daniel Beneš noted: “Onshore terminals will gradually replace the temporary floating ones, so from the outset, we sought to acquire long-term capacity in one of them. Until recently, we had not been in the LNG market at all, and over the last year and a half, we have gained a lot of experience that we will now build on.”
“We have leased capacity at the floating terminal in Eemshaven until the end of 2027, and thanks to Stade we will be able to smoothly continue supplying LNG after this date. Another advantage is that we will only have to cross one international border when transporting gas to the Czech Republic.”
Johann Killinger, HEH Managing Director and Shareholder, stated: “Our goal is to build the best possible infrastructure at Stade to ensure the long-term energy security of supplies to Germany and Central Europe. Hence we looked for stable strategic partners to join us in this project.”
“The terminal is based on a future flexible modular system for the transition to green energy in Europe. In 2027, we will launch an emissions-free terminal for LNG, bio-LNG and synthetic natural gas, while we are also preparing for the later expansion of the market in ammonia as a way to obtain green hydrogen.”
To remind, other lessees at the Stade terminal are the German companies EnBW and SEFE.
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