The United States will work to supply at least 15 billion cubic meters (bcm) of LNG to European Union markets this year, as the EU looks to slash dependence on Russian gas.
European Commission President Ursula von der Leyen and US President Joe Biden announced this on Friday, as the two sides agreed on several measures aimed at boosting European energy security.
However, the new document did not provide any information on how the US would secure these additional LNG supplies of 15 bcm or about 11 million tonnes. It did say that the US would work with international partners on the supplies.
This could also mean that US producers, which are already producing at maximum capacity, would reroute some of the Asian and other supplies to the EU, meaning that the EU would pay a hefty price.
One of the seven large US facilities which could add a significant amount to these exports is Venture Global’s Calcasieu Pass LNG plant. The newest US facility already sent three cargoes to Europe and should ramp up its production to 10 mtpa later this year once Venture Global commissions all modular units.
Data from the European Commission shows that in 2021 US LNG exports to the EU recorded the highest volume, reaching more than 22 bcm, with an estimated value of 12 billion euros ($13.2 billion).
In January 2022 imports reached the highest monthly, amounting to 4.4 bcm.
By January 2022, the EU imported more than 64 bcm of LNG from the US since April 2016, the data shows.
More supplies to come
The EU plans to significantly slash Russian pipeline gas supplies this year by boosting imports of LNG, filling up gas storages, and increasing renewables.
Russia supplied 155 bcm of gas, including LNG, to the EU last year, according to the IEA.
By diversifying gas supplies, Europe could replace 100 bcm of Russian gas imports or some two-thirds by the end of 2022, the Commission said earlier this month.
Besides the additional 15 Bcm of LNG this year, the EC will work with EU member states toward “ensuring stable demand for additional US LNG until at least 2030 of approximately 50 bcm/annum,” the document released on Friday shows.
Also, the US and the Commission would undertake efforts to reduce the greenhouse gas intensity of all new LNG infrastructure and associated pipelines.
This includes the use of “clean energy to power onsite operations, the reduction of methane leakage, and the construction of clean and renewable hydrogen ready infrastructure,” the document said.
The EC would also work with the governments of EU states to accelerate their regulatory procedures to review and determine approvals for LNG import infrastructure, to include onshore facilities and related pipelines to support imports using FSRUs, and fixed LNG import terminals.
In addition, the US also committed to maintaining an “enabling regulatory environment with procedures to review and expeditiously act upon applications to permit any additional export LNG capacities.”
These capacities would be needed to “meet this emergency energy security objective and support the RePowerEU goals, affirming the joint resolve to terminate EU dependence on Russian fossil fuels by 2027,” the document said.