By Chris King •
Published: 31 Oct 2023 • 18:51
Image of an LNG tanker.
Credit: The Mariner 4291/Shutterstock.com
SPAIN, along with Belgium, increased the import of Russian liquefied natural gas (LNG) by 50 per cent between January and September 2023.
However, according to analysis by the Institute of Energy Economics and Financial Analysis (IEEFA), European imports of Russian LNG remained stable year-on-year, compared to the same period in 2022.
Europe has managed to shed volumes from Gazprom’s gas pipelines said the IEEFA. The entity produces the data for the European LNG Tracker, an online interactive data tool that monitors the expansion and flows of LNG in Europe.
France, Spain and Belgium were named as the countries that significantly increased their imports of Russian LNG in that period. The latter two continued with the Russian transshipment of LNG volumes from the Yamal project the IEEFA pointed out.
Overall, Spain was Europe’s second largest LNG importer between January and September 2023, importing 19.4 billion cubic metres (19.4 bcm).
This total included 5.39 bcm of LNG from the United States; 5.21 bcm from Russia and 4.09 bcm from Nigeria, while Spain re-exported 1.05 bcm in that same period.
European LNG imports from January to September 2022 increased by 62 per cent compared to the same period in 2021. In 2023, they have only increased by 4 per cent compared to the previous year.
According to the IEEFA, the European Union (EU) has met its winter gas storage targets ahead of schedule. It subsequently warned that LNG capacity development in Europe was outpacing demand.
Despite this warning, the construction of LNG infrastructure is known to be planned in Europe, despite the stagnation of imports and the reduction in gas demand forecasts.
Six new LNG terminals have been added in Europe since the beginning of the year according to IEEFA. However, a previously mothballed terminal and a new floating storage and regasification unit are not yet operational.
Since the beginning of 2022, Europe has added 36.5 billion cubic metres (bcm) of new LNG capacity. Compared to an increase of 46.2 bcm in the same period in 2022, LNG consumption has only increased 4.8 bcm since the beginning of 2023.
There are currently an additional 143 billion cubic metres of new LNG import capacity that are in the European planning phase until 2030.
With this, European LNG capacity would rise to 406 billion cubic metres (406 bcm), almost triple the LNG demand forecast by IEEFA for that year, which was 150 billion cubic metres (150 bcm).
This import capacity of 406 bcm annually by 2030 (143 bcm more than in 2021), with the entry into operation of new terminals, will coincide with a drop in demand of around 400 bcm during the same period.
According to IEEFA data, the EU alone has spent €41 billion on LNG imports between January and July 2023. This included United States with €17.2 billion, Russia with €5.5 billion, and Qatar with €5.4 billion as major beneficiaries.
As of September 2023, the EU, Turkey and the UK had imported a total of 125 bcm of LNG, and Europe’s LNG terminals had an average utilisation rate of 58 per cent between January and September 2023.
The decrease in gas demand calls into question the need to increase LNG infrastructure in Europe to achieve its energy security objectives.
IEEFA Energy analyst Ana María Jaller-Makarevicz warned that European countries: ‘Despite significant progress towards reducing gas consumption, countries in Europe risk trading a reliance on Russian pipelines for a redundant LNG system that further exposes the continent to volatile prices’.
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Originally from Wales, Chris spent years on the Costa del Sol before moving to the Algarve where he is a web reporter for The Euro Weekly News covering international and Spanish national news.
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