German state-owned gas trader Uniper on Wednesday signed a long-term agreement to import liquefied natural gas (LNG) from Canada.
Uniper, Germany's largest gas trader, said it would buy 2 million tonnes of LNG annually over a period of up to 20 years. The first deliveries are expected in 2032.
The LNG will come from Canada's Ksi Lisims project. The agreement was signed at the Canadian Embassy in Berlin in the presence of German Economy Minister Katherina Reiche.
According to Uniper, the agreement marks another important milestone in building a "resilient, diversified and long-term" LNG portfolio.
Uniper chief executive Michael Lewis said the deal was about far more than LNG. By signing the long-term offtake agreement, the Dusseldorf-based company is strengthening its portfolio with a reliable Canadian LNG supply source.
"As a trusted partner, Canada is helping to diversify Europe's energy supply and enhance its resilience to future challenges," Lewis said.
A key feature of the Ksi Lisims project is the planned use of hydropower to power the liquefaction process. By combining access to Canadian natural gas reserves with renewable electricity, the project aims to produce LNG with a 90% lower carbon intensity than conventional LNG facilities.
In 2022, Uniper came close to collapse after Russia stopped supplying pipeline gas following its invasion of Ukraine, causing gas prices to soar. The German government rescued the company with billions in state aid, effectively becoming its sole shareholder.
EU rules require the German state to cut its stake to no more than 25% plus one share by the end of 2028.