The German idea for energy in Europe was based on cheap gas from Russia. Germany itself would become a dealer of this gas and distribute it over the rest of the continent. The Nord Stream 1 and 2 gas pipelines were laid for this purpose. As early as 2021, Germany imported a total of 142 billion m3, of which only 100 billion m3 for internal use, the rest was destined for re-export. After the possible launch of Nord Stream 2, Germany could potentially use an additional 55 billion m3 for the resale of blue fuel at a profit.
Plans to build liquefied natural gas (LNG) terminals came back from the afterlife when it turned out that Russia is not a reliable partner and is manipulating the gas market and attacking neighboring countries.
Germany has leased four storage and regasification vessels (FSRU) and has chosen Wilhelmshaven as its first LNG reloading hub, ahead of other sites that will also arrange the delivery of low-emission gases and clean hydrogen.
Like mushrooms after the rain
Uniper will provide two Dynagas managed FSRUs for the charter. The plan is to connect the first unit to existing infrastructure in Wilhelmshaven, which will be modified to be anchored on board and which in turn will travel approximately 27 miles from the port to connect to the existing pipeline network and the Etzel warehouse. With throughput of up to 7.5 billion cubic meters per year, Uniper says that approximately 8.5 percent of Germany’s natural gas needs will be unloaded in Wilhelmshaven in the future.
In total, four FSRU units will supply Germany with at least 20 billion cubic meters of LNG per year once they are commissioned.
The first FSRU is expected to be ready at the end of this year or early 2023 in this Lower Saxon port. The cabinet has earmarked 2.94 billion euros (USD 3.07 billion) for projects carried out by RWE and Uniper respectively. The latter stated on 4 July that he had been given permission to start immediately with the construction of the FSRU reception facilities.
Later, he plans to import ammonia, conduct electrolysis to convert it into pure hydrogen, and also create a pure hydrogen storage facility in Krummhoern, although hydrogen is only the future of energy.
As part of a separate Tree Energy Solutions project, Uniper will discuss plans to build an AvantHy LNG terminal in Wilhelmshaven in collaboration with E.ON in July with more than 25 stakeholders. These plans have recently been postponed to 2025.
The project company Hanseatic Energy Hub (HEH) invites market players to reserve 12 billion m3, or 90% of the regasification capacity of the planned hub, which could be realized in 2026, supported by the Belgian Fluxys group, the Swiss investment company Partners Group, the German logistics group Buss and the chemical company Dow. The final investment decision is expected next year.
The state of Schleswig-Holstein also wants to have the FSRU soon as a precursor to a fixed LNG installation with a capacity of 8 billion m3 with the possibility of expanding to 10 billion m3 at Brunsbuettel.
The project could start in 2026 or earlier and would be carried out by the state bank KfW with a 50% stake, while RWE will have 10% and the Dutch operator Gasunie 40%. Shell would reserve a large part of the LNG transported via this route. The port city of Hamburg and Rostock on the Baltic Sea have been suggested as possible sites for FSRU.
I have to admit that Germany reacted quite quickly, because at the beginning of May the decision was taken to charter four FSRUs. On the other hand, they had no choice, because lowering, and certainly withholding gas supplies to Russia, would cause a catastrophe for the German economy. Well, it’s better to diversify your gas supply late than never, as the saying goes.