Uniper has signed a two-year agreement with Vermilion Energy’s local subsidiary to procure all of its natural gas production from the company’s German operations.
Under the agreement, Vermilion will supply both low- and high-calorific natural gas, which Uniper will distribute across its customer network throughout Germany.
The deal is designed to bolster portfolio diversification and maintain a stable supply of locally produced gas at competitive prices.
Uniper chief commercial officer Carsten Poppinga said: “Extending this collaboration sends a clear signal of security and stability for the German energy market.
“In times of geopolitical uncertainty and the ongoing transformation of the energy system, it is crucial to rely on competitively priced supplies of locally produced natural gas and further strengthen the diversification of our portfolio.
“This agreement underscores our role as a reliable partner for industry, municipalities and households across Germany.
“It demonstrates how we take responsibility for a secure, sustainable and affordable energy supply.
“Our cooperation with Vermilion is an important building block in this strategy.”
Uniper, majority-owned by the German government since late 2022 following the European gas crisis, remains one of the country’s key players in natural gas trading and power generation.
The company has been reconfiguring its gas sourcing portfolio following the decline of Russian gas imports, investing in liquefied natural gas (LNG) infrastructure and exploring renewable and hydrogen-based energy systems.
Calgary-based Vermilion Energy has steadily expanded its German presence since entering the market in 2014, acquiring acreage and assets primarily in Lower Saxony, a region known for its significant natural gas reserves.
The company holds the largest exploration acreage position in the region and focuses on producing lower-carbon-intensity domestic gas that meets high environmental and safety standards.
This year, Vermilion expects to produce around 2.4 billion kilowatt-hours (kWh) of natural gas in Germany, equivalent to the annual consumption of roughly 220,000 households, according to company data.
Vermilion Energy Germany managing director Jefferey Lawrance Davies said: “We are proud to contribute to Germany’s energy supply with responsibly produced domestic resources.
“As long as natural gas remains part of the energy mix, local production should be the preferred option.
“Supplying German-produced gas to Uniper not only helps reduce CO₂ emissions compared with natural gas imports but also strengthens the resilience of the German energy system during the transition period.
“Our operations meet extremely robust safety and environmental standards, deliver a significantly lower carbon footprint than imported natural gas, and create regional value through continuous economic and social investment and our Community Investment Programme.”
The latest deal follows Uniper’s growing efforts to secure stable long-term natural gas supply contracts.
In July 2024, Uniper signed an eight-year agreement with Canada’s Tourmaline Oil Corp, expected to commence in November 2028, under which Tourmaline will deliver 80 billion British thermal units per day of natural gas — about 234 billion cubic feet over the full term of the contract.
