The European Union to Buy More America Liquid Natural Gas
The European Union to Buy More America Liquid Natural Gas
The United States and European Union have always had a favorable trade relationship regarding energy. In 2016, the United States improved this relationship further by removing restrictions that previously limited energy exports to countries with free trade agreements. With these regulations lifted, both the E.U. and the U.S. are benefiting. The United States can export its ever-growing supply of liquified natural gas (LNG), and the E.U. reduces its dependence on Russian gas. After the restriction was lifted, E.U. imports of U.S. liquified natural gas have already increased by 272%. It is projected that LNG imports will reach 8 billion cubic meters per year by 2023 - which is double 2018’s.The Growth behind LNG The growth of LNG has already been impressive, but it’s only the beginning. The U.S. has many untapped resources and land. Also, there is a need for technology and infrastructure to keep up with the demand. In recent years, the E.U. has voiced their desire to reduce their reliance on Russian’s energy. They have expressed interest in switching their supply needs to U.S. produced natural gas, which in return the U.S. will have to maintain and increase their production momentum. The United States is already reaching remarkable LNG production levels mainly in part to the Permian Basin. New buyers within Europe will increase current energy production levels even further.Infrastructure in Place in EuropeLiquid Natural Gas is transported by turning it from a gas to a liquid and then onboarding it on to ships. After the ships arrive at their destination, the LNG is then converted back to a gas. There have been substantial improvements in technology and infrastructure for transporting and reverting LNG. The improvements have been so fast that the E.U. currently has more storage capacity than LNG supply - which is predicted to change in the near future.The Bonds of EnergyThe United States and the E.U. remain allies in energy and the desire for the U.S. to produce more exports. Each country mutually benefits from the output of the United States’ naturally enriched lands. This year and the following will be an exciting time for the oil and gas energy - new buyers, more output, and more revenue.
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