Page 4 - FSUOGM Week 19 2022

FSUOGM COMMENTARY FSUOGM

European LNG rundown

We take an indepth look at the spate of LNG import projects that Europe is working on

RUSSIA IN the wake of Russia’s invasion of Ukraine, a raft Donbas region of east Ukraine on February 21,
of new LNG import projects have been proposed three days before all-out war began.
WHAT: across Europe, while a number of pre-invasion Germany does not currently buy any LNG,
Europe sees LNG as the projects that once were considered to have a relying instead on mostly gas from the Nether-
main means of phasing questionable economic case are now moving lands and Norway, as well as limited domestic
out Russian gas in the forward swiftly. supply, to supplement its Russian imports. But
near term. Once considered a backwater in terms of there are now four LNG import projects in play
LNG market growth prospects, Europe is now in the country, and while three were pre-war
WHY: embracing the supercooled gas like never before proposals, in recent months they have made
Projects are planned in its push to end all use of Russian gas. Indeed, rapid progress.
across the continent, data published by Gas Infrastructure Europe The largest of the planned terminals is in
even if there are (GIE) in late April indicates that Europe’s regas- Stade, and will have a capacity of 12 bcm per year.
questions about where ification capacity will rise by 102.5bn cubic It is backed by Hanseatic Energy Hub, whose
the needed gas will come metres per year to 361.8 bcm per year by 2026. shareholders include Belgium’s Fluzys, Swit-
from. It is therefore worth looking at what projects are zerland’s Partners Group and Hamburg-based
taking shape across the continent on a case-by- Buss Group. Planning approval is currently
WHAT NEXT: case basis. being sought for the €800mn ($880mn) project.
If all the projects are A non-binding round for its capacity took place
developed, by 2026, EU Germany’s U-turn in February last year and indicated sufficient
will be able to replace The European country that has made the most interest. A final investment decision (FID) is
over 100 bcm of Russian drastic U-turn in its energy policy is undoubt- officially targeted for next year, but given Ger-
gas purchases. edly Germany. For years, Germany has been many’s renewed commitment in LNG, the mile-
comfortable with its significant reliance on Rus- stone may be reached sooner. Operations are due
sian gas, which at times is used to cover as much to start in 2026.
as two thirds of its gas demand. The current Uniper, meanwhile, is pursuing a 7.5 bcm
government led by Chancellor Olaf Scholz fol- per year project in Wilhelmshaven, which failed
lowed the policy of its predecessor in maintain- to secure sufficient capacity booking interest
ing support for Russia’s Nord Stream 2 right up in the past, but is now back on the table. Uni-
until Russian troops moved into the rebel-held per announced on May 5 it had chartered two

P4 www. NEWSBASE .com Week 19 11•May•2022