Olaf Scholz strikes energy security deal in UAE

Olaf Scholz, the chancellor of Germany has agreed to the terms of a deal with the United Arab Emirates (UAE) and the core of it is energy supplies. The agreement was reached after Scholz and his entourage met with Emirati President Sheikh Mohammed bin Zayed Al Nahyan and other UAE leaders in Abu Dhabi. The European country will now be purchasing liquified natural gas (LNG) from the Gulf state, according to UAE state news agency WAM.

“I welcome the signing of the joint declaration” on the “energy security” agreement, Scholz said.

After meeting with the Saudi crown prince on Saturday, the chancellor travelled to the UAE on Sunday. He had earlier in the day underlined the necessity for Germany to rely on a variety of energy sources, stating that dependence on a single source “will certainly not happen again.”

Later on Sunday, to round off a two-day excursion to the area, Scholz made a pit stop in Qatar, the contentious host of this year’s World Cup soccer competition.

The new LNG port in Brunsbüttel, close to Hamburg, will receive a cargo of 137,000 cubic metres of LNG in December thanks to a contract struck with the German energy giant RWE.

Approximately 0.95 billion kilowatt hours of electricity are contained in the initial delivery, according to the DPA news agency. Before the invasion of Ukraine, on February 1 of this year, the Nord Stream 1 pipeline from Russia to Germany delivered the equivalent of 1.75 billion kilowatt hours of electricity in a day, according to its operators. Additionally, the business committed to long-term deliveries beginning in 2023.

“We need to make sure that the production of LNG in the world is advanced to the point where the high demand that exists can be met without having to resort to the production capacity that exists in Russia,” the chancellor said before the deal was reached.

Scholz was accompanied on this trip by a sizable delegation of German business executives, whose companies are particularly vulnerable to gas shortages this winter. Germany is also searching for green hydrogen out of the Gulf from sustainable energy sources.

The need to secure Germany’s energy supplies and the importance of human rights were both vital points of Scholz’s speech during his visit to Saudi Arabia. The balance of both themes is expected since Saudi Crown Prince Mohammed bin Salman has been accused of orchestrating the gruesome killing of Saudi journalist Jamal Khashoggi in 2018. 

Pan Finance is a print journal and news website providing worldwide intelligence on finance, economics and global commerce. Known for our in-depth analysis and opinion pieces from esteemed academics and celebrated professionals; our readership consists of senior decision makers from across the globe.

Contact us