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Uniper boosts its LNG trading footprint

The German gas wholesaler has expanded its reach far beyond its traditional European pipeline market

The European gas business of Uniper—spun off from German utility Eon in 2016—is to some degree reminiscent of the old German gas giant Ruhrgas. But the firm’s push into becoming an active portfolio player in the global LNG market could hardly be further removed from the famous conservatism of its forebear.

The core business remains gas marketing and gas-fired power plants. But the firm’s LNG strategy serves two important purposes, Uniper’s chief commercial officer Keith Martin tells Petroleum Economist at the Gastech conference in Houston.

Firstly, Uniper “wants to be able to source LNG for our customers at the most competitive price”, says Martin. “It is good to have balance in our portfolio between very reliable pipeline gas, complemented with global gas brought in as LNG, to allow us to give our customers, ultimately, the best possible mix.”

But there is a second string to the business. “We have such a big portfolio—it is natural for us to acquire, and then to optimise, LNG,” says Martin. And that takes Uniper firmly out of its European sphere.

“We see Asia as a target market and a growth market,” continues Martin. Last year Uniper traded around 140 cargoes and a quarter of these deals were in the Asia-Pacific region. “The growth in the amount of cargoes we have bought and sold has been prolific—it has quadrupled in just the last couple of years,” says Martin.

Growing liquidity in the global LNG market has been a key factor in enabling the growth of Uniper’s LNG trading business. “It allows someone like us, with such a big gas position in Europe, with such large flexibility [in the portfolio] and with a reputation as a reliable supplier, to take advantage of price signals and to position ourselves according,” says Martin.

 

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