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Danish energy company says it will cut ties with Gazprom in 2030

Danish energy company Ørsted has said that it cannot withdraw from an agreement to buy gas from Russian supplier Gazprom but will not extend its current contract when it expires in 2030.

Danish energy company Ørsted
Danish energy company Ørsted will not renew its current contract with Russian state-owned supplier Gazprom, scheduled to expire in 2030. Photo: Mads Claus Rasmussen/Ritzau Scanpix

The company confirmed in a statement on Monday it would remain tied to Gazprom until 2030, prior to reports that Russia had threatened to cut natural gas supplies to Europe via the Nord Stream 1 pipeline in response to sanctions imposed over its invasion of Ukraine.

Ørsted had come under pressure to extricate itself from its contract with Gazprom, which supplies Russian gas to the Danish company.

The company said on Monday that this was not possible but that it had chosen not to extend the current deal when it expires in 2030.

“Ørsted has a long-term gas purchasing contract with minimum delivery obligations, a so-called ‘take or pay’ deal for buying gas with Gazprom Export,” the company said in the statement.

“The contract was entered into in 2006 and expires under its terms in 2030. The contract cannot be cancelled at the current time,” it said.

“The contract will not be renewed,” it added.

Ørsted also said in the statement that the company condemns the invasion of Ukraine by Russia and that it had made other moves to reduce partnerships with Russian companies.

This includes no longer purchasing Russian biomass or coal for Ørsted power plants and not signing any new contracts with Russian companies.

At a press briefing on Sunday, Prime Minister Mette Frederiksen expressed a wish to make Denmark “independent of Russian gas as soon as possible”, but did not specify a time frame.

The PM also said that Denmark would work with the EU on further sanctions against Russia, including a possible block on gas imports.

In its statement, Ørsted said it supported all political initiatives relating to independence from Russian gas, including political import sanctions if any were to be imposed.

The company also said it would donate profits from its own sales of Russian gas to humanitarian help in Ukraine.

“We have made the decision that we do not wish to profit from business with a state-owned company from an aggressive, war-waging nation,” Ørsted CEO Mads Nipper told news wire Ritzau.

The decision must be approved at the company’s AGM in April.

READ ALSO: Denmark to hold referendum on scrapping EU defence opt-out

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ENERGY

Denmark and three other EU nations want to increase North Sea wind power tenfold by 2050

EU members Germany, Denmark, the Netherlands and Belgium on Wednesday said they wanted to increase their North Sea wind power capacity tenfold by 2050 to help the bloc achieve its climate goals and avoid Russian hydrocarbons.

Denmark and three other EU nations want to increase North Sea wind power tenfold by 2050

Danish Prime Minister Mette Frederiksen said the plan would mean the four countries would “deliver more than half of all offshore wind needed to reach climate neutrality in the European Union”.

The increase would make the North Sea “the green power plant of Europe”, she told a news conference in the port of Esbjerg in western Denmark.

“Setting a vision is not enough, we will make it happen,” Frederiksen added, flanked by German Chancellor Olaf Scholz, EU chief Ursula von der Leyen, Dutch premier Mark Rutte and Belgian leader Alexander De Croo.

The countries’ goal is to raise wind power capacity fourfold to 65 gigawatts by 2030 and then tenfold to almost 150 gigawatts by 2050.

They said 150 gigawatts of offshore wind power would supply 230 million homes with electricity.

Such a capacity would amount to 15,000-20,000 wind turbines, based on the most powerful ones currently on the market.

The announcement comes as the European Commission presented a plan to accelerate the development of renewable energy worth 210 billion euros ($220 billion) to reduce the bloc’s dependence on Russian gas as quickly as possible.

The European Union has already said it will end imports of Russian coal by August.

An embargo on Russian oil as part of a sixth sanctions package against Moscow for its invasion of Ukraine is proving more contentious after Hungary raised objections.

The commission has said it wants to reduce purchases of Russian gas by two-thirds this year and completely before 2030.

On Wednesday it proposed to increase the proportion of renewable energies in the bloc’s energy mix from 40 percent to 45 percent by 2030.

The 27-nation EU aims to reduce greenhouse gas emissions by at least 55 percent by 2030 and achieve carbon neutrality by 2050.

READ ALSO: Danish offshore wind could help Europe ditch fossil fuels

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