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Outlooks diverge for German LNG projects

RWE remains bullish on Brunsbuettel while Uniper rethinks Wilhelmshaven

German utility RWE, which is signed up to take a “significant part of the capacity” of the proposed 5bn m³/yr LNG import facility in northwest Germany, remains confident of progress on the plant. But its peer Uniper is going back to the drawing board with a similar plan for a 10bn m³/yr project further along the country’s northwestern coast.

“I can confirm that we expect the EPC contracts to be submitted by year-end,” says Markus Krebber, RWE’s CFO, while cautioning that the firm is not either the current or future operator of the planned facility. The Brunsbuettel terminal is bring advanced by a consortium of German logistics firm Oiltanking and Dutch infrastructure companies Vopak and Gasunie.  “So, we have a slight delay,” admits Krebber, “but we expect to take [FID on] the terminal in the first half of next year. And we are all optimistic that we will get that terminal built, which would then be the first LNG terminal in Germany.” FID was initially due by the end of last year, with construction to begin this year ahead of startup in the fourth quarter of 2022. 

Wilhelmshaven struggles

 While the Brunsbuettel project is obviously now at least 18 months behind that schedule, it is still in better shape than Uniper’s proposed Wilhelmshaven terminal. The open interest period for third parties to sign up for capacity in the plant finished at the end of October “without a sufficient response” in terms of concrete booking commitments, despite “numerous” players having taken part in the process and having “expressed general interest”.

“We are all optimistic that we will get [the Brunsbuettel LNG terminal] built, which would then be the first LNG terminal in Germany” Krebber, RWE

“Economic uncertainties have definitely played a role in the current circumstances,” says Uniper’s project manager, Oliver Giese. “Many companies do not want to make long-term commitments at the moment. The results of the expression-of-interest procedure show that we need to revise the scope and focus of the planned terminal to ensure that it remains attractive to market players and economically predictable for [operating subsidiary] LTeW and Uniper.”

The firm will now consider using the Wilhelmshaven site as a port for importing what it calls “environmentally friendly gas”, without specifying exactly what it means by that term. It also discusses “adapting individual parameters of the terminal or adding new elements”, which may mean changes to its initial floating storage and regasification unit plan. And it will look at the possibility of importing hydrogen “in the long term”.

There is a third large-scale proposed German LNG import facility, the 5-8bn m³/yr Hanseatic Energy Hub at Stade, backed by Australian bank Macquarie and infrastructure firm China Harbour Engineering. It also promises environmentally friendly solutions, including a “zero emissions” terminal due to its collaboration with chemicals heavyweight Dow at the industrial park adjacent to the site of the project, as well as future bio-LNG and hydrogen.

But it has disclosed no details on any contracts to reserve capacity, and it is difficult to see how it is likely to be more successful than Wilhelmshaven in doing so. The plan has also come under attack in November from local politicians from both the Left and Green parties.

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