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U.S. natural gas can easily replace Russian gas in Europe, the chief executive of EQT, the country’s largest producer of gas, told the BBC in an interview.
“We’ve got the ability to do more, the desire to do more,” Toby Rice told the BBC, estimating that the United States had enough gas to quadruple current output by 2030.
However, boosting exports of natural gas to Europe is not only a question of availability and willingness on the part of gas producers. There are other obstacles preventing U.S. gas from taking the place of Russian gas in Europe.
These include a lack of import terminals on the continent as well as export terminals in the United States itself. Currently, there are eight operating export terminals on the Gulf Coast, and 14 more have been approved for construction. However, the process of taking an LNG facility from final investment decision to operation takes several years.
There has also been political opposition to increasing LNG export capacity on climate change grounds. Recently, a coalition of more than a hundred advocacy groups called on the six largest U.S. lenders to stop financing new LNG export facilities on the Gulf Coast.
Yet even if this opposition was absent, the purely technical problems to a major boost in U.S. LNG exports to Europe would remain. There is also the question of cost. LNG is costlier than pipeline gas, and the longer the distance it has to travel to its final destination, the more expensive it becomes.
Be that as it may, Europe was the biggest buyer of U.S. liquefied natural gas over the last three months, taking in more than half of the total LNG exports in December and February.
Europe, however, is running out of regasification capacity. Spain and France have the biggest import capacity in the EU, with the UK coming in second in Europe as a whole with 50 billion cubic meters in annual nameplate LNG import capacity. Germany, on the other hand, the biggest gas market in Europe, has zero LNG import terminals.
