VNG CEO says LNG can supplant Russian gas: press
The CEO of VNG, a gas supplier active in east Germany, expects Russian gas deliveries to be impacted as Berlin applies more pressure to Moscow over the Ukraine war, but believes more LNG purchases can help fill the gap, Reuters reported on April 5.
VNG's Ulf Heitmueller envisages an LNG purchasing "boom" driven by German energy firms searching for a resolution to "security of supply difficulties", with Russia currently accounting for 40% of national gas consumption.
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He thinks the shock to the market will prompt VNG to seek more renewable sources of electricity, accelerating the energy transition. VNG, headquartered in the East German city of Leipzig, is majority owned by Germany utility EnBW, which revealed early plans to buy an additional 3bn m3/year of LNG on March 31.
"Russian gas will lose in importance for VNG and the much-discussed bridging period for gas to usher in a carbon-free energy future will become shorter," he said.
The Ukraine war is now into its second month, and Moscow's atrocities in the war have aggravated the damage to Russia's energy trade with Germany. On April 3, the German defence minister called for an effective EU ban on Russian gas imports to punish Vladimir Putin for "his crimes".
Berlin's stance has stiffened. It had previously argued several European economies were too dependent on Russian gas to impose an embargo, according to Reuters.
A German utility industry association said on April 1 that Germany could replace around 50% of its Russian gas quantities by the end of this year. It has three LNG terminal projects in early development that could help in the medium term. But Germany's need for gas may also increase in coming years, as the country shuts down its baseload nuclear and coal power plants. The country's three remaining nuclear stations, with a total 9,500 MW capacity, will close later this year and Berlin aims to gradually phase out coal-fired electricity by 2038.