Equinor signs new supply agreement for natural gas with Germany’s major energy company RWE
Agreement is signed for 5 years starting in October this year with volumes of between 10 to 15 TWh per year.
RWE and Equinor have signed a new supply contract for between 10 and 15 terrawatt hours (equivalent to ca. 1 – 1.5 billion cubic metrers – bcm) of natural gas per year from now until 2028.
This new bilateral agreement builds upon the long-standing relationship between RWE and Equinor. The contract is priced at market terms and the gas will be delivered at Germany’s virtual trading hub THE (Trading Hub Europe).
“Germany and Norway have been energy partners ever since Norwegian gas exports first started more than 45 years ago. I am very pleased that we continue to develop this partnership and that we can announce another bilateral agreement between Equinor and RWE, which is one of many companies that see Norwegian gas as an enabler for energy security as well as of the energy transition,” says Helge Haugane, Equinor’s senior vice president Gas & Power.
Andree Stracke, CEO of RWE Supply & Trading:
“We are delighted to have signed a long-term gas supply agreement with our partner Equinor. For us as a global energy trader gas plays an important role in the energy transition. The newly concluded gas supply agreement adds a further important building block to our Pan-European natural gas portfolio contributing to security of supply.”
Earlier this year RWE and Equinor announced their plan to develop large-scale value chains to ensure security of supply and reduce emissions in response to the German-Norwegian Partnership on Climate, Renewable Energy and Green Industry.
The first step is to invest in and develop gas fired power plants in Germany that are ready to use hydrogen as feedstock as soon as it becomes available on an industrial scale in the country. These plants are also subject to the power plant strategy announced by the German government, which aims to create a suitable regulatory framework for new gas-fired power plants.
Key elements in the value chain will be exports of low carbon hydrogen from Norway to Germany which could help speed up the development of a hydrogen economy. Gradually, green hydrogen will also be produced using power from wind farms along the pipeline route.