When governments make decisions, often times businesses have to react to change and often it takes time to find alternatives. The alternatives are both short term which all large companies have plans for and long-term which everyone says they want to do but it is difficult to do quickly because of logistics and the resources required. Two years ago, Russia invaded the Ukraine and the western governments put sanctions on Russian goods and services including oil and gas.

In an article by Riham Alkousaa and Christoph Steitz of Reuters, Germany state-owned energy firm Sefe secured a $73 billion gas deal with Norway’s Equinor that will cover 1/3 of the industrial gas needs of Europe’s largest economy.

The deal strengthens Norway’s position as Germany’s top supplier of natural gas. Before the sanctions, Gazprom was the leading supplier of gas, now Norway accounts for 40-50% of Germany’s gas imports.

The supply deal covers about 10 billion cubic meters of natural gas per year from Jan 1, 2024 until 2034 and carries an option for another 5 billion cubic meters.

About 90% of the gas Sefe will get through existing pipelines are indexed on the TTF and THE gas-trading hubs to be available for the German and Dutch markets.

Linking to dividend paying stocks, all large companies have plans or alternatives if something goes wrong or situations change for the worse. In the case of the gas supply, it has taken 2 years to get another long-term supplier. It is always possible, but it takes time to change, however large companies typically have plans and ideas where to begin that many smaller companies would be flying by their seats, which allow the larger companies to retain their margins and stay profitable.

There are more questions than answers, till the next time – to raising questions.