Equinor and Germany’s state-owned energy company, SEFE (Securing Energy for Europe), have entered into long-term gas sales agreements, signaling not only a strategic energy partnership but also a significant step toward large-scale hydrogen supplies.
Under the agreements, Equinor is set to supply SEFE with a colossal 111 terrawatt hours (approximately 10 billion cubic meters) of natural gas annually from January 1, 2024, until 2034, with an additional option for another 5 years. This substantial volume accounts for a third of German industrial demand, emphasizing the magnitude of the partnership.
The 5-year option, spanning 319 TWh (roughly 29 bcm), solidifies the long-term commitment between the companies. Furthermore, a non-binding letter of intent has been signed, envisioning SEFE as a long-term off-taker of giga-scale, low-carbon hydrogen from Equinor, a transformative initiative set to commence in 2029 and extend until 2060.
The agreement positions Equinor as a major supplier, contributing significantly to Germany and Europe’s energy security. The gas will be delivered to key trading hubs in Germany, the Netherlands, and the UK.
The collaboration’s focus extends to low-carbon hydrogen, with SEFE potentially becoming a key off-taker of hydrogen from Equinor’s planned projects across the continent and in Norway. The ambition is to supply low-carbon hydrogen at an industrial scale, starting with 5 TWh per year from 2029 and ramping up to an impressive 40 TWh per year by 2060.
The collaboration not only outlines a decade of gas supply but also lays the groundwork for a future dominated by hydrogen. SEFE and Equinor share ambitious goals for accelerating the hydrogen economy, with potential joint ventures related to hydrogen transport and storage. Dr. Laege hints at SEFE Group’s storage company, Astora, playing a pivotal role in these future endeavors.