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Europe needs additional volumes of liquefied natural gas (LNG) to ease the tight market and alleviate supply concerns, Michael Lewis, CEO of Germany’s energy giant Uniper, told Bloomberg Television in an interview published on Thursday.
“Until significantly more LNG volumes come onto the market, there is going to be a tight situation,” said the chief executive of the energy group, which the German government bailed out last year at the peak of the energy crisis.
Germany nationalized Uniper in September 2022 as it was looking to prevent a collapse of the German energy and gas suppliers, which had been amassing losses with the lack of contracted Russian gas supply and the high price they had to pay on the spot market to replace lost Russian volumes.
Uniper is now rebuilding itself to be in a better position to face the energy transition, CEO Lewis told Bloomberg.
Uniper now expects to book a higher profit for 2023 than previously anticipated thanks to hedging bets the company made for its power generation and natural gas distribution businesses.
In terms of gas supply to Europe and Germany, supply disruptions continue to be a risk for Germany, the chief executive of the country’s biggest utility, RWE, said early last month.
“We don't have any buffer in the gas system,” RWE’s chief executive officer Markus Krebber told German publication WirtschaftsWoche, adding that Europe’s biggest economy must accelerate the construction of gas import infrastructure to avoid future shortages.
Germany expects natural gas prices to remain high until at least 2027, the government said in an August report on the measures to mitigate high energy costs for households.
A week earlier, INES, the group of German gas storage operators, said in its August gas update that Germany would continue to be at risk of natural gas shortages until the 2026/2027 winter season unless it takes measures to add LNG terminals, additional gas storage capacity, or pipelines.
By Tsvetana Paraskova for Oilprice.com
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.