Since Russia began exerting financial pressure by retracting its natural gas exports, the European and Asian markets have been scrambling to maintain sustainable levels. The US has assisted by increasing LNG exports to these markets – particularly Europe.

Samik Mukherjee explains that liquified natural gas (LNG) is a vital source of energy transfer across long distances as it allows each shipment to carry nearly 600 times the capacity of natural gas in its standard gas form.
However, since LNG requires regasification, it requires similar levels of infrastructure on the receiving end.

The situation is more complicated than a question of importing and exporting infrastructure. Russia’s approach to leverage the export of natural gas to Europe as a bargaining chip in the negotiations, has caused upset in energy security and affordability throughout the world.

The Two Fronts: Europe and Asia

There were already natural gas disputes between Ukraine and Russia leading up to the invasion. After the attack in February of 2022, Russia began cutting off other European countries.

This led to fears concerning the natural gas reserves in these areas for the remainder of 2022 and the 2023 winter. To combat this, the US began a ‘gas lift’ project wherein the US LNG infrastructure worked at maximum possible capacity to meet European demands.

The other half of this plan was to ask importers in the Asian market to redirect some of their imports to Europe. Some, like Japan, agreed, as long as their needs were still met. The response from Russia was aggressive leading to Russia’s nationalization of one of its LNG plants.

The culmination of these factors is a two-front challenge to balance the energy security and the affordability for a growing demand in Asia and diversifying away from Russian gas in Europe. Both the Asian and European fronts need enough natural gas to be secured in the energy sector.

Why LNG is Important to US Exports

US exports of LNG were able to support importers in Europe and Asia through the winter heading into 2023. That said, this could not have been accomplished without liquified natural gas infrastructure.

There are two major reasons this ‘gas lift’ could not have been done with standard natural gas export methods.

• Natural gas pipelines are fixed.
• LNG is 600 times more condensed.

The simplest reason is that pipelines only go from point to point. Once built there is not much that can be done to shift the destination. This makes any pipeline export extremely rigid. LNG on the other hand can be shipped anywhere in the world.

The other major reason is the quantity of exports. Since LNG is supercooled it condenses 600 times denser. This allows the US to ship far greater quantities at one time.

The downside of this liquefaction process is that it requires processing both before and after shipping.

Final Thoughts

Since early 2022, there have been several new natural gas trade agreements between the US and its allies in both Europe and Asia. LNG production in the United States was able to keep up with demand, but its, but its supply has not grown as much. The future of LNG must grow if the US is going to be able to keep up.

The future of LNG must grow if the US is going to be able to keep up to balance the energy security and affordability across the world as we transition towards more sustainable energy mix.