Decreasing Europe’s dependence on Russian natural gas is one of European leaders’ most pressing challenges. But is it actually feasible, or just a wild dream? One of the hopes for alternative sources of supply for the future, lies in U.S. LNG export projects. But a lot of questions remain to be answered before we can ensure U.S. LNG will come to Europe in significant volumes.
The United States has become the largest natural gas producer in the world, and we shall think it is therefore in a good position to help Europe achieve greater energy security. A joint EU-US statement from last March 26th has highlighted this point, and the intention to assist Europe has been publicly announced by the White House.
However, in spite of the leaders’ good will, some issues remain to be overcome before the dream comes true. First, there is the fact that the American Department of Energy is known for its slowness at delivering LNG export permits to allow U.S. producers to ship abroad. Since Europe does not have a Free Trade Agreement (FTA) with the United States, it cannot readily receive LNG exports from the U.S. As reported by Fuel Fix, The New York Times, The Washington Post, and The Wall Street Journal have all published editorials asking the U.S. government to speed up LNG exports, highlighting the importance of considering the role of energy in promoting American foreign policy interests.
Then, of course, there is price. Since all U.S. gas exported to Europe has to be liquefied and shipped, you have to consider the extremely energy intensive liquefaction process, and add it on to the price of natural gas. As noted by The National Interest in an article titled “LNG Won’t Save Europe”, at current domestic natural gas prices, LNG delivered to Europe would require a price of over 9 dollars per thousand cubic feet including liquefaction and shipping. And that is where Russia, with its pipelines across Europe, finds itself in a privileged position to maintain its energy domination over Europe.
What do you think? Can Europe achieve energy independence from Russia? Which are the safer and most promising routes to greater energy security? Have your say by starting a discussion or leaving a comment below.
You could also learn much more from experts in the field, by attending the European LNG Briefing on 19th June in London.