Trafigura secures $3bn loan facility to provide Germany with natural gas

Commodity trading house Trafigura has signed a $3bn loan facility partly backstopped by the German government to help supply natural gas to Sefe, the quasi-nationalised entity that was formerly Gazprom Germania.

The $3bn loan facility will last for four years and was led by Deutsche Bank and another arranger that has asked not to be named, and syndicated among more than 25 other banks, the company said.

The loan deal illustrates the latest move by commodity traders to try and help Germany secure commodities following Russia’s invasion of Ukraine.

Trafigura will supply Sefe, which rebranded as Securing Energy For Europe after being effectively nationalised by Germany, with natural gas largely from existing supplies, trading pipeline gas and utilising its global portfolio of LNG supply deals.

The loan is backstopped by the German government’s Untied Financial Loan programme, which is designed to help secure strategic commodities for Germany through the Export Credit Agency’s Euler Hermes Aktiengesellschaft scheme.

The scheme has existed for years but has become more prominent following Russia’s invasion of Ukraine, which left Germany scrambling to replace natural gas supplies after Gazprom slashed exports to the EU.

“The loan will support a new commitment by Trafigura to deliver substantial volumes of gas into the European gas grid, and ultimately into Germany, over the next four years,” the company said.

Trafigura said the first delivery under the new loan had already taken place on November 1.

Richard Holtum, head of gas and power trading at Trafigura, said the arrangement would involve the company supplying a “significant volume of gas to Germany backed by our extensive portfolio and long-term US LNG contracts”.

Before Russia’s invasion of Ukraine Germany was unique among Europe’s major economies in never having built an LNG import terminal, preferring instead to rely solely on gas shipped by pipeline, primarily from Russia and Norway.

But the country has already established one terminal that will be supplied by a floating storage and regasification unit tanker, with at least three more expected to follow in the coming months.

Germany has expressed some hesitation over long-term LNG deals given its commitments to cut emissions, but did sign a 15-year agreement to take supplies from Qatar last month.

Analysts said Germany appeared to be taking a portfolio approach, establishing a mixture of long-term deals alongside shorter-term arrangements with trading houses.

In October Trafigura signed a similar $800mn deal to help provide Germany with non-Russian metals over the next five years.

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