CEZ strengthens energy security. It has started bringing gas from Algeria, it will go under the sea to Europe

After two years of difficult negotiations, CEZ trading specialists concluded a contract for gas supplies from Algeria with the local company SONATRACH. The deliveries started in October and the gas is flowing from Algeria via Tunisia, then via an undersea pipeline to Italy and then to Europe and the Czech Republic. The contract was concluded for about two percent of the annual gas consumption in the Czech Republic, which corresponds to the consumption of about a hundred thousand households. CEZ negotiated the contract with the support of the Ministry of Industry and Trade of the Czech Republic, the Ministry of Foreign Affairs of the Czech Republic and the Czech Embassy in Algeria.

"We have taken another step to strengthen our energy security. In addition to gas supplies from German suppliers, from Norway and from our LNG terminal in Eemshaven, we will now also import gas from fields in North Africa. Negotiations with the Algerian state-owned company SONATRACH were constructive and were brought to a successful conclusion," said the CEO of ČEZ Daniel Benes.

This contract helps CEZ not only to expand the geographical spectrum of potential suppliers and meet the needs of the Czech Republic, but also to secure an additional route that will enable gas supplies to the country in case of a shortage on the domestic market. CEZ will purchase gas from Algeria on its own account, without financial participation of the Czech state.

"Cooperation with trustworthy partners and maximum diversification of gas supplies are essential for the Czech Republic's energy security. The more trade routes we have for the supply of this essential commodity, the less we will be affected by possible supply shortages elsewhere. Our aim is to continue to link Czech traders with alternative suppliers. Algeria is one such partner and I am very pleased that after negotiations we have managed to secure supplies capable of covering the consumption of up to 100,000 Czech households." says the Minister of Industry and Trade Lukáš Vlček.

"We are addressing the energy crisis in Europe comprehensively. We are glad that our embassy could assist CEZ in this respect and that an agreement was finally reached with the Algerian company SONATRACH. Assistance of this kind is one of the important tasks of our diplomacy," said the Minister of Foreign Affairs Jan Lipavsky.

The move comes shortly after the second anniversary of the Eemshaven LNG terminal, which saw the Czech Republic gain its first ever contracted capacity. The facility in the Netherlands is capable of handling eight billion cubic metres of gas a year, three billion of which are reserved for the Czech Republic. This volume represents more than one-third of the country's annual consumption. In its two years of operation, the terminal has received 43 ships carrying the equivalent of 3.86 billion cubic metres of gas destined for the Czech Republic. In addition to ČEZ, the terminal's capacity is also used by multinational companies Shell and Engie. No Russian gas has been transported to the terminal since it started operating, which was one of the explicit conditions of the tender.

At the end of 2023, CEZ has also secured additional LNG capacity for the Czech Republic in the volume of two billion cubic meters per year for 15 years with an option to extend it for 25 years at the newly built onshore terminal in Stade, Germany, at the mouth of the Elbe River. Construction of the terminal began this spring and is scheduled to be operational in the second half of 2027.

CEZ/ gnews - RoZ