Norwegian oil and gas company Equinor has signed a long-term gas supply deal with Germany’s Securing Energy for Europe (SEFE).
Under the terms of the agreement, Equinor will supply state-owned SEFE with approximately 111TWh of natural gas annually from 1 January 2024 until 2034.
This volume is said to be equal to around one-third of Germany’s industrial gas requirements.
There is also an option for an extension of the deal for five years, which would include a total of roughly 319TWh of natural gas.
Additionally, the two companies have signed a non-binding letter of intent that outlines SEFE’s potential role as a long-term and industrial-scale customer for Equinor’s low-carbon hydrogen.
Hydrogen deliveries from Equinor’s planned projects in Norway and around the continent are anticipated to start in 2029 and last until 2060.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below formBy GlobalData
The supply will begin at 5TWh of low-carbon hydrogen annually in 2029 and increase gradually to 40TWh annually in the years 2050–60.
Gas will be delivered by Equinor to key European trading sites, including as the National Balancing Point in the UK, Title Transfer Facility in the Netherlands and Trading Hub Europe in Germany.
Equinor CEO Anders Opedal said: “The total volumes we have agreed make this one of the largest agreements we have made as a company, and the supplies will contribute to energy security for Germany and Europe.
“I am also pleased to sign the letter of intent to explore opportunities to supply SEFE with low-carbon hydrogen at industrial scale for decades to come, enabling European industries and flexible gas power plants to accelerate decarbonisation.”
SEFE CEO Egbert Laege said: “By signing the agreements for gas and hydrogen supply, we have teamed up with a strong European supplier that brings us a big step closer to our common goal of decarbonising the energy sector while at the same time providing energy security.
“The procurement of natural gas from the Norwegian Continental Shelf [NCS] ensures the sustainable and future-proof supply for European and, in particular, German customers in the household and industrial sectors.”
Last week, Equinor increased its stake in Linnorm discovery, which is said to be the biggest undeveloped gas discovery on the NCS.