UAE in 15-Year Germany Gas Deal in Boost to Energy Security

The United Arab Emirates agreed to sell liquefied natural gas to Germany for 15 years starting 2028, in a deal that further cements Europe’s fossil fuel use and underpins the Middle Eastern country’s plan to become a key supplier.

Abu Dhabi National Oil Co. signed a preliminary accord to send 1 million tons of LNG a year to German state-owned energy group SEFE, the companies said in separate statements. Adnoc will supply the fuel from an LNG export facility it plans to build in Ruwais near Abu Dhabi, according to the statements.

The UAE is scouring the globe for deals that will allow it to ramp up exports of the fuel. Germany, meanwhile, has fast-tracked imports of LNG and is snapping up seaborne cargoes after Russia curbed pipeline gas deliveries following its invasion of Ukraine.

Europe’s largest economy has acknowledged that gas will play a key role in the medium term as it hopes to exit coal by the end of this decade. Eventually it aims to shift to cleaner forms of energy and is trying to incentivize the build-out of hydrogen infrastructure. Germany wants to be climate neutral by 2045.

“Gas accounts for almost a quarter of Germany’s primary energy use, and we look forward to supporting its efforts to diversify its energy sources and enhance its energy security,” Fatema Al Nuaimi, Adnoc’s executive vice president for downstream business management, said in a statement.

Adnoc’s deal with SEFE depends on a final investment decision for the Ruwais LNG project — which the UAE firm expects this year — and a definitive sales and purchase agreement between the two companies. Adnoc moved closer to a call of the facility when it awarded initial engineering and construction contracts earlier this month.

The company had also signed a 15-year agreement with China’s ENN for at least 1 million tons a year of LNG from Ruwais last year. The project’s total annual export capacity will be 9.6 million tons. Adnoc already has a 6 million-ton facility at Das Island that began operations in 1977.

SEFE has been adding supply since the former unit of Gazprom PJSC was nationalized by the German government in 2022. The company has signed deals with Norway’s Equinor ASA and Venture Global LNG Inc. to keep gas flowing to Germany’s industry and homes.