UK supermajor Shell has become a first to book capacity in a planned liquefied natural gas terminal in Germany, signing a memorandum of understanding with project operator German LNG Terminal, to be built in in Brunsbuttel, close to the city of Hamburg.

Though the volume of the upcoming booking has not been disclosed, the operator said that it will take “a substantial part” of the terminal’s annual import capacity of 8 billion cubic metres of gas.

The terminal will include two intermediate storage tanks - each with capacity for 165,000 cubic metres - regasification facilities for conversion back to a gas-ready aggregate state and a a jetty in the delta of the river Elbe with two berths for LNG carriers up to QMax size.

"Both parties are currently working towards a binding agreement on the scope and duration of their partnership, and hope to complete it as soon as possible," Shell said in a statement.

German officials have stressed that planning of new LNG import facilities and its components will take into account the future import of hydrogen or hydrogen derivatives.

"The terminal will not only contribute to energy supply security in Germany, but also, in perspective, to the necessary climate-neutral energy supply," said said Dr. Michael Kleemiß, Managing Director of German LNG Terminal

Following regasification, imported gas will be pumped into the German high-pressure natural gas grid. Storage tanks will also supply LNG for loading onto tanker trucks, rail tank cars and LNG bunker ships.

The operator said that smaller LNG cargoes can be easily transported to ports of Cuxhaven, Bremen and Bremerhaven. The nearby Kiel canal offers a possibility to distribute LNG from Brunsbuttel to Scandinavia and the Baltic states by smaller vessels.

As part of the response to Russia's invasion of Ukraine, and the decision to suspend certification of the Nord Stream 2 pipeline, Germany is planning to fast-track two LNG import and regasification terminals, one at Brunsbuttel and the other at Wilhelmshaven

German Chancellor Olaf Scholz announced the decision to revive the stalled projects.

“We need to do more in order to protect the energy supply of our country… in order to overcome our import dependency on single energy suppliers,” he said.

Early in March, German bank Kreditanstalt fur Wiederaufbau (KfW) acting on behalf of the German government, the Netherlands’ Gasunie LNG Holding and German’s RWE signed a memorandum of understanding on the joint promotion of the construction and operation of the LNG terminal in Brunsbuttel.

The possibility of a third German LNG project has been aired, calling for the construction of a 12 Bcm/year terminal in the city of Stade on the left bank of the river of Elbe.

German energy company RWE has also unveiled plans to build a terminal for the import of green ammonia in Brunsbuttel

Poland is also expanding its LNG import capacity, and Lithuania and Estonia are looking to follow suit.