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U.S. to Increase Gas Exports to Europe

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Oil drums with Russian flag | Image by rawf8 / Shutterstock

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President Joe Biden and President of the European Commission Ursula von der Leyen announced in Brussels Friday that the U.S. and European Union will be launching a joint task force. The task force will be focused on weaning Europe off of its reliance on Russian gas, as Russia currently supplies around 40% of Europe’s gas imports.

According to a White House statement, the task force will “work to ensure energy security for Ukraine and the European Union (EU) in preparation for next winter and the following one while supporting the EU’s goal to end its dependence on Russian fossil fuels.”

One task force plan will be for the U.S. and other nations to increase their liquefied natural gas (LNG) exports to Europe by 15 billion cubic meters this year (BCM). Last year, the European Union bought a record 22 BCM of U.S. LNG. The plan also sets a goal for the U.S. to send 50 BCM of LNG to Europe annually by 2030.

Senior U.S. administration officials have not specified what amount or percentage of the extra LNG supply would come from the United States.

“It’s going to take some time to adjust gas supply chains and infrastructure that (were) built for the last decade, so we’re going to have to make sure the families in Europe can get through this winter and the next while we’re building an infrastructure for a diversified, resilient and clean energy future,” Biden said.

The EU aims to reduce its reliance on Russian gas by two-thirds this year and ultimately end all Russian gas imports by 2027 due to Russia’s invasion of Ukraine. The U.S. has already banned Russian oil and gas imports in response to the war.

Biden said that Russian President Vladimir Putin uses energy to “coerce and manipulate his neighbors” and uses the profits from its sale to “drive his war machine.”

He added limiting imports from Russia is not “only the right thing to do from a moral standpoint,” but “it’s going to put us on a stronger strategic footing.”

U.S. LNG plants are already currently producing at total capacity. Experts say most of any other U.S. gas sent to Europe would have to come from gas planned for delivery elsewhere.

“It normally takes two to three years to build a new production facility, so this deal may be more about the re-direction of existing supplies than new capacity,” Alex Froley, gas and LNG analyst at ICIS, told Reuters.

According to analysts at ING Bank, even if the 15 BCM increase is achievable this year, “It still falls well short of replacing Russian gas imports, which amounted to around 155 BCM in 2021.”

Meanwhile, in Germany, the largest consumer of Russian gas in the EU, their Economy Minister, Robert Habeck, said it could take until the summer of 2024 for the country to wean itself entirely off Russian gas.

Still, the country said it has made “significant progress” towards reducing its exposure to imports of Russian gas, oil, and coal.

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