In northern Europe, women have long dominated politics: Yesterday, four female heads of government surrounded Chancellor Olaf Scholz when he appeared before the press alongside host Jonas Gahr Støre during his visit to the Nordic Council in Oslo. The group was largely in agreement on energy policy, but not so on the issue of Schengen visas for Russian citizens. Finland’s Sanna Marin and Denmark’s Mette Frederiksen again made it clear that they would like to restrict grants because of Russia’s war of aggression – after all, many Russians support their president’s actions, Marin argued. Scholz countered that this was Putin’s war, not the war of the Russian people. In the end, however, the EU wants to agree on a position – there is consensus on that, at least.
The EU could cover a third of its LNG requirements via imports from Spain – but the pipelines to improve connections to Spain are still missing. The “MidCat” pipeline project, a pipeline to the French border, had been put on hold in 2019 due to doubts about its economic viability. Other pipelines, such as the one across the Mediterranean to Italy and one to Portugal, have also yet to be realized. Time is of the essence, but luckily the Spanish government wants to move fast, as Isabel Cuesta Camacho reports.
In addition to the enormous increase in gas prices, the industry will have to pay a gas levy of 2.419 cents per kilowatt hour from October. If Chancellor Olaf Scholz has his way, no value-added tax will have to be paid on this amount – if the EU Commission agrees. More on this in the News.
The current gas crisis is the most serious to date – not just for Christian Schubert personally but also for the BASF Group, for which he has held various positions since 2001. In today’s profile, we introduce him as the head of Corporate Government Relations and the Berlin office at BASF, where he is in direct contact with politicians and does a lot of explaining in times of crisis.
From the Spanish government’s point of view, things could move quickly: In just eight or nine months, the new pipeline through the Catalan Pyrenees to the border with France could be ready for operation, said the Minister for Ecological Transition, Teresa Ribera, in a TV interview on Friday. However, she said, the prerequisite is that the other countries involved and the EU Commission agree on the project.
German Chancellor Olaf Scholz had previously declared that he would hold talks on the pipeline with EU Commission President Ursula von der Leyen and his counterparts in Spain, Portugal, and France. The “Midi-Catalonia Pipeline” (MidCat) project had been suspended in 2019 due to doubts about its economic viability. The Spanish government has been pressing for several months to revive the project in order to be able to export gas from the peninsula as an alternative to Russian supplies.
Ribera stressed that Chancellor Scholz’s comments succeeded in highlighting something Spain has been advocating for some time: that energy interconnections are not just a bilateral issue, but are important for all countries in the Union. “So far, we have only discussed energy interconnections across the Pyrenees in bilateral talks with France,” the minister said.
The MidCat project has had a long wait, in part because France refused to build it after several delays. In March of this year, Ribera said that “it was very difficult to make progress with France on energy interconnections”.
The current twin pipeline across the Basque Country to France has an annual capacity of only seven billion cubic meters of gas (bcm). Given the time pressure created by the energy emergency this winter and fall, Ribera mentioned the possibility of installing “an additional compressor” on the existing connection through the Pyrenees to increase it to 8 to 9 bcm.
According to the head of the gas network operator Enagás, Arturo Gonzalo, the MidCat project now differs from the earlier plans in crucial ways: “The old MidCat was designed for a north-south connection and exclusively for gas. The planned new pipeline will run in a south-north direction and be designed for hydrogen, although it can also transport gas in an initial phase.”
Spain accounts for a large share of the EU’s LNG import capacity and purchases gas through pipelines from Algeria. However, Algerian gas imports have been affected by political tensions between Algiers and Madrid, making the United States the largest exporter of LNG to Spain since the beginning of this year.
However, the Iberian peninsula has so far been poorly connected to the rest of the EU. The government in Madrid wants to change that to avert the threat of gas rationing in other countries. Spain could thus make “costly, complex and sophisticated infrastructure that cannot be built in a few months accessible to all” through its LNG terminals, Ribera said. Spain’s natural gas exports have averaged two terawatt hours (TWh) per month over the past five years. The country could increase this to 6.7 TWh per month with its infrastructures.
Enagás’ strategic plan includes three new pipelines: in addition to the MidCat pipeline with France and a new connection to Portugal, above all a pipeline with Italy. Currently, LNG is delivered to Italy via a shuttle service by ship. This mechanism was introduced as an interim solution while the 700 km pipeline between Barcelona and Livorno is being built to supply Italy from 2028.
The gas pipeline across the Mediterranean requires an investment of €2.5 to €3 billion. The Spanish government, for one, insists that the money for the construction of this project must come from the EU budget or from Italy and the countries in the center and north of the European Union – “those that will really benefit from the pipeline”.
Spain owes its new importance as a gas hub primarily to the six regasification plants currently in operation, which process LNG, particularly from the United States, Qatar, and Nigeria. These account for one-third of the capacity of the entire EU and 44 percent of the EU’s liquefied natural gas storage potential.
In addition, a seventh facility is to be commissioned to supply the EU partners: The government had only recently given the green light for the El Musel terminal in Gijón on the Cantabrian coast, which was already being built in 2021. According to Enagás, the facility has a storage capacity of 300,000 cubic meters of LNG. It also has berthing and unloading facilities for the world’s largest LNG tankers, which can hold up to 266,000 cubic meters.
According to Enagás CEO Gonzalo, the El Musel facility could be in use within six to eight months. “The terminal in Gijón will be able to unload and load more than 100 LNG vessels per year, contributing up to eight billion cubic meters of gas.”
In addition, Madrid is also prepared to save energy itself to avoid shortages. At the end of July, member states adopted a regulation requiring them to reduce their gas consumption by 15 percent between August 1, 2022, and March 31, 2023, to be able to survive a winter without Russian gas. Under the new regulation, countries with low interconnection capacity with the rest of Europe that are not dependent on Russian gas, such as Spain and Portugal, will benefit from a smaller gas cut – only seven percent in the case of Spain.
In application of the Spanish government’s new energy-saving plan, several measures came into force on August 10, including the regulation of air conditioning systems to a minimum of 27 degrees Celsius – in winter, heaters must not exceed 19 degrees Celsius. Shop windows and lights in public buildings that are not occupied after 10 p.m. must be turned off. Street lights remain on.
The measures apply to all buildings and premises used for administrative purposes (public administrations), commercial facilities (department stores, supermarkets, shopping centers), and cultural facilities such as cinemas or conference centers. The same applies to train stations and airports. The energy saving measures are only valid as a recommendation for Spanish households.
Christian Schubert is quick to answer the question of whether the current gas crisis and war is the most difficult phase BASF has experienced. “Yes!” says the chief lobbyist of the Ludwigshafen-based chemical company. Both for the company, he says, the crises were difficult, but also for him personally. “I was born in 1963. There have been many crises since then, but none have been so fundamental.”
Schubert, who studied industrial engineering, started at the Federal Foreign Office in the economics department. However, there were different views on how to proceed, he says. Instead of diplomacy, he went into business: He first headed corporate strategy at Debis, a former services subsidiary of Daimler-Benz, and later became its press spokesman. In 2001, he joined BASF and has headed the Berlin office for seven years.
For him, as a lobbyist, the current crisis means explaining even more. “That’s also my job in corporate communications. I’m a kind of translator between politics and business – in both directions.” He and his team have already had one success. The chemical industry, and therefore BASF, is seen by politicians as what they perceive themselves to be: the starting point of almost all industrial value chains because it produces many basic materials. If a cogwheel breaks down here, the entire chain comes to a standstill.
That’s why the gas shortage is so dangerous, he said, and not just for the chemical company. “It’s about more than BASF. It affects Germany as a whole as a business location.” The second danger is that the price of gas will continue to rise because that will also make production in Germany more expensive – another competitive disadvantage for the country.
The crisis is catching the chemical group at an inopportune time. After all, Martin Brudermüller has been in charge of BASF’s business since 2018 – he wanted to free the company from fossil raw materials in the medium term, switch production to green hydrogen or electrification, for example. Last year, it was announced that BASF, together with Vattenfall, plans to build the world’s largest offshore wind farm with a total capacity of 1.5 gigawatts off the coast of the Netherlands.
These are all important steps toward climate neutrality, but one important factor was gas as a transition technology. That was also what the politicians had promised. “Phasing out fossil fuels is possible in the medium term, but the crisis is catching us in the short term,” says Schubert. Thus, the transformation will also become “significantly more challenging”.
Schubert heads a team of 25 people, eight of them in Berlin, including himself. He explains BASF to politicians, but also brings a lot of politics into the company. To do that, for example, the company organizes townhall meetings with employees. Schubert spends many lunch breaks with representatives of associations or from politics. “On a normal lobbying day, it lends itself to that because you have to eat at some point anyway and so you can talk on the side.” Tom Schmidtgen
In northern Europe, women have long dominated politics: Yesterday, four female heads of government surrounded Chancellor Olaf Scholz when he appeared before the press alongside host Jonas Gahr Støre during his visit to the Nordic Council in Oslo. The group was largely in agreement on energy policy, but not so on the issue of Schengen visas for Russian citizens. Finland’s Sanna Marin and Denmark’s Mette Frederiksen again made it clear that they would like to restrict grants because of Russia’s war of aggression – after all, many Russians support their president’s actions, Marin argued. Scholz countered that this was Putin’s war, not the war of the Russian people. In the end, however, the EU wants to agree on a position – there is consensus on that, at least.
The EU could cover a third of its LNG requirements via imports from Spain – but the pipelines to improve connections to Spain are still missing. The “MidCat” pipeline project, a pipeline to the French border, had been put on hold in 2019 due to doubts about its economic viability. Other pipelines, such as the one across the Mediterranean to Italy and one to Portugal, have also yet to be realized. Time is of the essence, but luckily the Spanish government wants to move fast, as Isabel Cuesta Camacho reports.
In addition to the enormous increase in gas prices, the industry will have to pay a gas levy of 2.419 cents per kilowatt hour from October. If Chancellor Olaf Scholz has his way, no value-added tax will have to be paid on this amount – if the EU Commission agrees. More on this in the News.
The current gas crisis is the most serious to date – not just for Christian Schubert personally but also for the BASF Group, for which he has held various positions since 2001. In today’s profile, we introduce him as the head of Corporate Government Relations and the Berlin office at BASF, where he is in direct contact with politicians and does a lot of explaining in times of crisis.
From the Spanish government’s point of view, things could move quickly: In just eight or nine months, the new pipeline through the Catalan Pyrenees to the border with France could be ready for operation, said the Minister for Ecological Transition, Teresa Ribera, in a TV interview on Friday. However, she said, the prerequisite is that the other countries involved and the EU Commission agree on the project.
German Chancellor Olaf Scholz had previously declared that he would hold talks on the pipeline with EU Commission President Ursula von der Leyen and his counterparts in Spain, Portugal, and France. The “Midi-Catalonia Pipeline” (MidCat) project had been suspended in 2019 due to doubts about its economic viability. The Spanish government has been pressing for several months to revive the project in order to be able to export gas from the peninsula as an alternative to Russian supplies.
Ribera stressed that Chancellor Scholz’s comments succeeded in highlighting something Spain has been advocating for some time: that energy interconnections are not just a bilateral issue, but are important for all countries in the Union. “So far, we have only discussed energy interconnections across the Pyrenees in bilateral talks with France,” the minister said.
The MidCat project has had a long wait, in part because France refused to build it after several delays. In March of this year, Ribera said that “it was very difficult to make progress with France on energy interconnections”.
The current twin pipeline across the Basque Country to France has an annual capacity of only seven billion cubic meters of gas (bcm). Given the time pressure created by the energy emergency this winter and fall, Ribera mentioned the possibility of installing “an additional compressor” on the existing connection through the Pyrenees to increase it to 8 to 9 bcm.
According to the head of the gas network operator Enagás, Arturo Gonzalo, the MidCat project now differs from the earlier plans in crucial ways: “The old MidCat was designed for a north-south connection and exclusively for gas. The planned new pipeline will run in a south-north direction and be designed for hydrogen, although it can also transport gas in an initial phase.”
Spain accounts for a large share of the EU’s LNG import capacity and purchases gas through pipelines from Algeria. However, Algerian gas imports have been affected by political tensions between Algiers and Madrid, making the United States the largest exporter of LNG to Spain since the beginning of this year.
However, the Iberian peninsula has so far been poorly connected to the rest of the EU. The government in Madrid wants to change that to avert the threat of gas rationing in other countries. Spain could thus make “costly, complex and sophisticated infrastructure that cannot be built in a few months accessible to all” through its LNG terminals, Ribera said. Spain’s natural gas exports have averaged two terawatt hours (TWh) per month over the past five years. The country could increase this to 6.7 TWh per month with its infrastructures.
Enagás’ strategic plan includes three new pipelines: in addition to the MidCat pipeline with France and a new connection to Portugal, above all a pipeline with Italy. Currently, LNG is delivered to Italy via a shuttle service by ship. This mechanism was introduced as an interim solution while the 700 km pipeline between Barcelona and Livorno is being built to supply Italy from 2028.
The gas pipeline across the Mediterranean requires an investment of €2.5 to €3 billion. The Spanish government, for one, insists that the money for the construction of this project must come from the EU budget or from Italy and the countries in the center and north of the European Union – “those that will really benefit from the pipeline”.
Spain owes its new importance as a gas hub primarily to the six regasification plants currently in operation, which process LNG, particularly from the United States, Qatar, and Nigeria. These account for one-third of the capacity of the entire EU and 44 percent of the EU’s liquefied natural gas storage potential.
In addition, a seventh facility is to be commissioned to supply the EU partners: The government had only recently given the green light for the El Musel terminal in Gijón on the Cantabrian coast, which was already being built in 2021. According to Enagás, the facility has a storage capacity of 300,000 cubic meters of LNG. It also has berthing and unloading facilities for the world’s largest LNG tankers, which can hold up to 266,000 cubic meters.
According to Enagás CEO Gonzalo, the El Musel facility could be in use within six to eight months. “The terminal in Gijón will be able to unload and load more than 100 LNG vessels per year, contributing up to eight billion cubic meters of gas.”
In addition, Madrid is also prepared to save energy itself to avoid shortages. At the end of July, member states adopted a regulation requiring them to reduce their gas consumption by 15 percent between August 1, 2022, and March 31, 2023, to be able to survive a winter without Russian gas. Under the new regulation, countries with low interconnection capacity with the rest of Europe that are not dependent on Russian gas, such as Spain and Portugal, will benefit from a smaller gas cut – only seven percent in the case of Spain.
In application of the Spanish government’s new energy-saving plan, several measures came into force on August 10, including the regulation of air conditioning systems to a minimum of 27 degrees Celsius – in winter, heaters must not exceed 19 degrees Celsius. Shop windows and lights in public buildings that are not occupied after 10 p.m. must be turned off. Street lights remain on.
The measures apply to all buildings and premises used for administrative purposes (public administrations), commercial facilities (department stores, supermarkets, shopping centers), and cultural facilities such as cinemas or conference centers. The same applies to train stations and airports. The energy saving measures are only valid as a recommendation for Spanish households.
Christian Schubert is quick to answer the question of whether the current gas crisis and war is the most difficult phase BASF has experienced. “Yes!” says the chief lobbyist of the Ludwigshafen-based chemical company. Both for the company, he says, the crises were difficult, but also for him personally. “I was born in 1963. There have been many crises since then, but none have been so fundamental.”
Schubert, who studied industrial engineering, started at the Federal Foreign Office in the economics department. However, there were different views on how to proceed, he says. Instead of diplomacy, he went into business: He first headed corporate strategy at Debis, a former services subsidiary of Daimler-Benz, and later became its press spokesman. In 2001, he joined BASF and has headed the Berlin office for seven years.
For him, as a lobbyist, the current crisis means explaining even more. “That’s also my job in corporate communications. I’m a kind of translator between politics and business – in both directions.” He and his team have already had one success. The chemical industry, and therefore BASF, is seen by politicians as what they perceive themselves to be: the starting point of almost all industrial value chains because it produces many basic materials. If a cogwheel breaks down here, the entire chain comes to a standstill.
That’s why the gas shortage is so dangerous, he said, and not just for the chemical company. “It’s about more than BASF. It affects Germany as a whole as a business location.” The second danger is that the price of gas will continue to rise because that will also make production in Germany more expensive – another competitive disadvantage for the country.
The crisis is catching the chemical group at an inopportune time. After all, Martin Brudermüller has been in charge of BASF’s business since 2018 – he wanted to free the company from fossil raw materials in the medium term, switch production to green hydrogen or electrification, for example. Last year, it was announced that BASF, together with Vattenfall, plans to build the world’s largest offshore wind farm with a total capacity of 1.5 gigawatts off the coast of the Netherlands.
These are all important steps toward climate neutrality, but one important factor was gas as a transition technology. That was also what the politicians had promised. “Phasing out fossil fuels is possible in the medium term, but the crisis is catching us in the short term,” says Schubert. Thus, the transformation will also become “significantly more challenging”.
Schubert heads a team of 25 people, eight of them in Berlin, including himself. He explains BASF to politicians, but also brings a lot of politics into the company. To do that, for example, the company organizes townhall meetings with employees. Schubert spends many lunch breaks with representatives of associations or from politics. “On a normal lobbying day, it lends itself to that because you have to eat at some point anyway and so you can talk on the side.” Tom Schmidtgen
