Germany said it has signed a long-term deal with Qatar for the supply of liquefied natural gas, while Berlin is looking for alternative energy suppliers for Russia.

In Doha, as part of a tour of the Gulf, German Economy Minister Robert Habeck said on Sunday the deal would be a “door-opener” for the country’s economy as it would reduce its reliance on imported Russian gas. , which currently accounts for more than half of annual supply.

He declined to provide details of the quantities and other terms discussed. The ministry said it is up to individual German energy companies, whose bosses have accompanied Habeck on the trip to Qatar, to make agreements with the Arab state’s companies.

“We may still need Russian gas this year, but not in the future,” Habeck told DPA in Doha. “It starts like this – so whoever has ears should start listening,” he said in a thinly veiled message to Russian President Vladimir Putin.

Qatar in a statement welcomed Germany’s decision to “accelerate” the development of two LNG terminals and said the countries’ respective commercial entities would re-enter talks on long-term LNG deliveries from Qatar to Germany and continue”.

Germany’s move comes as EU leaders prepare to meet in Brussels on Thursday to discuss how to respond to the shock of rising energy prices, exacerbated by the war in Ukraine and the desire to free itself from to get off the Russian gas after Moscow’s invasion of Moscow.

The Berlin coalition government has ruled out a lifetime extension of the remaining German nuclear power plants, which are expected to close by the end of the year, and is pinning its hopes on LNG terminals to increase the amount of gas it imports from Russia through pipelines. Reduce.

In addition to efforts to find alternative energy suppliers, EU governments are trying to protect households and businesses from rising energy costs.

On Sunday, Austria announced it would spend €2 billion to subsidize energy costs for its citizens.

Italy said Friday it wanted to raise €4.4 billion by levying a 10 percent tax on higher profits reported by companies between October 2021 and March 2022 compared to the previous year, if that increase exceeds €5 million.

With the new tax, Italy aims to cut excise duties at the petrol pump by 25 cents per liter until the end of April and protect the country’s 5.2 million poorest families from further increases in their energy bills. Energy companies likely to be affected by the tax include Eni and Enel.

“We will tax some of the extraordinary profits that companies make from rising raw material costs and redistribute this money to companies and families in difficulty,” Prime Minister Mario Draghi said.

Italy has already spent €16 billion since last summer to protect poor families and small businesses from rising energy costs.

However, Italy’s business lobby, Confindustria, called Rome’s initiative “disappointing” and warned that the windfall profit tax “may have been against the Constitution”. The CISL, or Italian Confederation of Workers’ Unions, called the 10 percent excess profit tax “too low” and pushed for an increase.

Mario Draghi

Italian Prime Minister Mario Draghi said tax on energy companies’ profits will be redistributed ‘to companies and families in difficulty’ © Riccardo Antimiani/AP

Italy is not alone in turning to the unexpected profits of energy companies. The UK Labor party is pushing for a tax on North Sea oil and gas companies, which would otherwise reap huge financial benefits from the current price hikes. In September, Spain introduced a windfall tax on energy companies, but revised it under industry pressure, reducing the amount it had to raise.

Electricity prices will also be a controversial topic at the upcoming EU summit. Southern Member States are pushing for changes in the way wholesale markets work to ease the pressure on households, but are facing strong resistance from Northern Europe.

Spain and Italy both want the EU to change its electricity price rules, which have effectively linked the price of electricity to rising gas costs, and allowed renewable energy groups to charge well above the cost.

Rome and Madrid are also urging the EU to jointly negotiate energy purchases to get better deals, especially for pipeline gas from Russia, which would reduce payouts to Russian energy companies.

“I can’t say this would be the optimal moral solution, but it would have an impact,” said Roberto Cingolani, minister for ecological transition.

Engaged in intense diplomacy, the like-minded leaders of Italy, Spain, Portugal and Greece met last Friday to try to build momentum for their proposed energy market reforms.

That evening, Spanish Prime Minister Pedro Sánchez dined with German Chancellor Olaf Scholz — one of the key figures Madrid must convince — and Sánchez will travel to Paris on Monday to meet French President Emmanuel Macron.

Diplomats warn, however, that there is no consensus on these market reforms, which some say could undermine incentives for new investment in renewable energy. Some countries, such as the Netherlands, argue that the short-term focus should remain on energy savings and filling gas storage facilities.

Additional coverage by Sam Fleming in Brussels, Daniel Dombey in Madrid and Andrew England in London

This post Germany says it has signed a long-term gas supply agreement with Qatar

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