Page 5 - GLNG Week 12 2022

GLNG COMMENTARY GLNG

US LNG projects
working their way
towards FID could
benefit from recent
developments.

Cheniere welcomed the additional opera- approach to the siting of natural gas projects”.
tional flexibility the authorisation gives it, While the new guidelines may yet be brought
there is only so much more LNG it can export in once the comment period is complete, the
from its existing trains. That said, the company FERC faces growing pressure not to take steps
does appear increasingly closer to taking FID that could hamper efforts to send more US LNG
on the Stage 3 expansion of its Corpus Christi to Europe. The question is whether the regulator
LNG terminal. will be able to strike a balance between allow-
ing the US to keep ramping up exports through
Standing to benefit new capacity additions while providing new
Indeed, it is those projects that have yet to reach certainty on the environmental impact of pro-
FID that could benefit the most from the latest jects is assessed.
efforts to send additional US LNG supplies to
Europe. Cheniere, Venture Global and Tellurian What next?
are all thought to be close to proceeding to con- Either way, US efforts to ramp up LNG exports to
struction on proposed projects, plus a handful of Europe will not bear fruit overnight. This has led
other developers are also trying to advance plans analysts to speculate that the additional volumes
for new capacity, but have a longer way to go to the country wants to send to Europe this year
reach FID. If supply deals with European buyers will involve the redirection of existing supply. The FERC faces
are expedited, though, this would significantly But redirection of LNG under contract is
speed up progress. complicated – though it can be done, as demon- growing pressure
On the regulatory side, meanwhile, it also strated by China’s Sinopec recently reselling not to take
looks like efforts to send more gas to Europe are some of the cargoes it is due to load from the
being taken into consideration. Calcasieu Pass terminal over the summer. steps that could
The US Federal Energy Regulatory Commis- Nonetheless, it is thought that already high
sion’s (FERC) chairman, Richard Glick, said on European gas prices would need to rise further hamper efforts
March 24 that two guidelines the regulator had still in order for more redirection to Europe to
approved last month to consider greenhouse gas happen. to send more US
(GHG), environmental justice and landowner Additionally, 15 bcm is still a small volume LNG to Europe.
issues before authorising LNG terminals and compared with how much gas Europe imports
other gas projects would now be considered from Russia. Even if the amount is achievable,
“drafts”. These draft guidelines will not apply “it still falls well short of replacing Russian gas
to pending projects until FERC issues any imports, which amounted to around 155 bcm
final guidance. A comment period on the new in 2021”, Reuters quoted analysts at ING Bank
guidelines is now underway until April 25, with as saying.
a reply due on May 25. An Oxford Institute for Energy Studies
Glick said the regulator had decided to gather (OIES) research fellow, Jonathan Stern, agreed
comments from all interested stakeholders “in in comments cited by Bloomberg. “All contri-
light of concerns that the policy statements cre- butions will be welcome but the task is huge,”
ated further confusion about the commission’s Stern said.™

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