Friday, December 8, 2023

US boosts LNG supplies to the EU, aiming to reduce reliance on Russia

US authorizes LNG exports from Driftwood and Port Arthur projects

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The increased exports of American liquefied natural gas (LNG) to Europe will decrease the European Union’s reliance on Russia and boost EU energy security, former Member of the European Parliament Niki Tzavela, who served in the energy and EU-US relations committees, told New Europe in an interview on 2 May.

Commenting on the results of the EU-US Energy Council High-Level Business to Business Energy Forum held in Brussels, Tzavela said by phone, “The decision of the USA to start supplying Europe with redundant American gas is very crucial for stability in the Western World,” adding, “This for me is the ultimate solution for keeping the West free from the Russian monopoly of Gazprom.”

The LNG imports will help reduce gas prices, Tzavela said, adding that the US LNG will boost diversification of sources, especially as Gazprom plans to complete the Nord Stream-2 pipeline from Russia to Germany.

“It will keep the prices lower, first of all, and then Nord Stream-2, I don’t know how stable the relationship will be with Russia. You never know. But, in my opinion, all the gas we can get in Europe, it’s a good thing as long as we keep a good price,” the former MEP said. “This was quite a long shot back in 2010. There were many obstacles. First of all, there was not American legislation permitting exporting of the gas and oil because until then they did not have the redundant quantity of this.”

She noted that the US shale oil boom and subsequent legislation paved the way for US gas exports. The agreement to advance construction of two pipelines from Canada to the United States, supplying the American market with oil which will keep US energy prices at a good level prompted the US energy industry “not stop this deal with Europe,” Tzavela said.

She also said that the facilities that exist in the US ports are made for importing and not exporting LNG and converting them comes at a high cost. “But they started already with Louisiana and some others,” Tzavela said.

On 2 May, the US Department of Energy announced the signing of two long-term orders authorizing the export of domestically produced LNG from Tellurian’s Driftwood LNG export facility to be built in Calcasieu Parish, Louisiana, and Sempra Energy’s Port Arthur LNG export project to be built in Port Arthur, Texas.

Turning to Southeast Europe, Tzavela stressed that Greece is becoming a hub in the Eastern Mediterranean. “It has to be because it is a natural hub,” the former MEP from Greece said. She highlighted the importance of the Alexandroupolis Floating Storage Regasification Unit (FSRU) project for regional energy security.

“Alexandroupolis is the perfect port we have for the FSRU unit there because this is closest port that can supply the Balkans and some of Central Europe,” she added.

“LNG will be coming from Africa, from Australia, from all over the world. The Mediterranean is going to be quite a channel for transporting LNG,” she said.

At the EU-US Energy Council High-Level Business to Business Energy Forum held in Brussels on 2 May, EU Climate and Energy Commissioner Miguel Arias Cañete and US Secretary of Energy Rick Perry discussed broader aspects of EU-US energy relations.

“Energy security is one of the key success stories of our transatlantic cooperation and one where we both have a keen mutual interest,” Cañete said, speaking after the meeting. “It is therefore our common objective to further deepen our energy cooperation. Natural gas will remain an important component of the EU’s energy mix in the near future as we move towards cleaner sources of energy. Given our heavy dependence on imports, US liquefied natural gas, if priced competitively, could play an increasing and strategic role in EU gas supply.”

For his part, Perry reminded on 2 May, “Today’s discussion follows on last July’s joint statement by President Trump and (EU Commission) President (Jean-Claude) Juncker on strengthening our strategic energy partnership. We share a history of transatlantic cooperation, through good times and bad, and together we promote our heritage of freedom. The strength of this relationship can particularly be seen in energy. When it comes to natural gas, we each have what the other needs to derive tremendous mutual benefit from advancing our energy relationship.”

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Co-founder / Director of Energy & Climate Policy and Security at NE Global Media


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