Page 4 - NorthAmOil Week 09 2022

NorthAmOil COMMENTARY NorthAmOil

Spotlight shines on US LNG as

Europe grapples with gas questions

US LNG is in the spotlight as Europe urgently considers how it can reduce dependence on

Russian gas in the wake of Moscow’s attack on Ukraine

US-EUROPE US LNG is in the spotlight once again in the Russian gas supply agreements and projects,
wake of Russia’s invasion of Ukraine last week, paving the way for other gas import plans for
WHAT: as questions over how Europe could reduce its Europe to be expedited.
US LNG is in the spotlight dependence on Russian natural gas take on a These developments have helped send Euro-
as diversification as new urgency. The notion that more US LNG pean prices to new record highs, with traders
European gas buyers could be shipped to Europe is nothing new, hav- now anticipating energy shortages to last into
urgently consider their ing been touted by the administration of former 2023.
options. US President Donald Trump in particular. Now,
though, there are compelling reasons to believe Major supplier
WHY: that European buyers would pivot more towards Against this backdrop, it has emerged that
This follows Russia’s US LNG and that additional projects in the US Europe remained the top importer of US LNG
invasion of Ukraine last could proceed to construction faster than previ- for the third consecutive month in February.
week. ously expected as a result of recent events. Preliminary data from Refinitiv, cited by Reu-
This follows two extraordinary weeks that ters, showed that Europe accounted for nearly
WHAT NEXT: saw swift and dramatic responses to the war in 75% of US LNG exports last month. And the US
More US LNG volumes Ukraine, including a range of sanctions against Energy Information Administration (EIA) said
can be expected to go to Russia and a series of announcements from last week that exports of US LNG to the EU and
Europe, at least in the various companies that they would stop doing the UK had risen from 3.4bn cubic feet (96.3mn
near term. business in or with Russia. On the natural gas cubic metres) per day in November 2021 to 6.5
side, one of the most notable developments was bcf (184.1 mcm) per day in January 2022. This is
the suspension by Germany of the certifica- the most LNG shipped to Europe from the US on
tion process for the Nord Stream 2 gas pipeline a monthly basis to date, the agency noted.
from Russia. With the pipeline now looking Recent developments could accelerate the
extremely unlikely to enter service, Germany rise of LNG shipments to Europe further still.
has pledged to back two planned LNG import And they coincide with the start-up of Venture
terminals instead. Global LNG’s 10mn tonne per year (tpy) Calca-
Meanwhile, Shell and Centrica are among sieu Pass export terminal in Louisiana – the fifth
the companies that have said they would exit LNG plant on the US Gulf Coast. The Yiannis

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