Insightful real time information of Russia’s fossil exports is published by CREA (energyandcleanair.org); latest summary below. Revenue to Russia fallen roughly in half since Feb attributable to stopping of coal imports and drastic reduction of gas imports including impacts from the NORD stream pipeline damage. Largest Euro importers of Russian energy are the Netherlands and Germany, in the form of oil imports. China is by far the largest global importer of Russian energy.
The U.S. has become the world’s largest LNG exporter and 2/3 of that production is now going to Europe. 10s of $B of additional LNG export capacity is being built, primarily on the Gulf of Mexico. In the recently passed IRA legislation, the US has allocated $1.B to incentivize the gas industry to modify production practices to minimize methane leakage through detection technology, value, tank, and distribution upgrades. Penalties for methane emissions also exist.
Pres Biden committed to increase gas exports to Europe in March. For the first half of this year, exports over-achieved his promised target, with total deliveries at 57 bcm. This compares favorably to the offline NORD1 ANNUAL capacity of 59 bcm.
It is encouraging to see funds Russia could use for their war effort significantly diminished, while simultaneously the US is helping stabilize Europe’s short term energy needs with cleaner gas exports.
Longer term, electrification of appliances and rapid construction of renewable energy and electric transmission in Europe will enable more cleaner energy at lower cost. It will be interesting to see how much of the planned LNG expansion is financeable given risk of stranded assets.
Shug
