EU sees need for LNG in energy plan

Pipelines won't solve all of Europe's energy problems, commissioner says.

By Daniel J. Graeber

DUBLIN, Ireland, April 24 (UPI) -- Liquefied natural gas needs to re-emerge as a central component of European energy security strategies, the European commissioner for energy said.

The European Commission this week filed statements of concern against Russian natural gas company Gazprom, saying it was violating antitrust measures in Eastern and Central Europe.


The European market gets about 20 percent of its gas needs met by Russia, though most of that supply runs through a Soviet-era transit network in Ukraine, where lingering political and national security issues present risks to European energy security.

Miguel Arias Canete, the European commissioner for energy, told delegates at a gas infrastructure conference in Dublin the situation in Ukraine has sharpened the sense of risks to the European energy market.

"We need a clear diversification strategy," he said in his Thursday address. "We have to diversify supply, energy sources, suppliers and routes."

Gazprom is accused of controlling how its consumers can sell gas across borders, which the European Commission said restricts diversity. Gazprom countered its contracts predate existing antitrust measures in the European Union.

A series of pipelines are planned for delivery of natural gas to the European market from the Shah Deniz reserve basin in the Azeri waters of the Caspian Sea. Development of Shah Deniz is underway from a consortium led by British energy company BP.


Canete said pipeline infrastructure isn't, however, a panacea for the European energy market. Liquefied natural gas, for which maritime delivery offers a safety valve for some geopolitical concerns, should be placed back on the agenda.

"European LNG imports almost halved between 2011 and 2014," he said. "The EU has effectively become a residual market, getting what Asian countries do not need or cannot afford [and] that needs to change."

The White House is reviewing a series of transnational trade deals that could open the doors to the European energy market. For U.S. allies in Europe, the abundance of natural gas from domestic shale basins could be used as a tool to break the Russian grip on the European economy.

Companies looking to send shale gas from the United States in the form of LNG need a special permit to do so from the federal government if they seek to target economies without a free-trade agreement.

There are no free-trade agreements in place between the United States and European countries.

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