The Biden administration has approved more requests to export U.S. natural gas as it seeks to counteract Russia’s efforts to use the fuel as a weapon against Ukraine’s allies.
Golden Pass LNG, a liquefied natural gas project Qatar Petroleum and Exxon Mobil Corp. are building in Texas, and Glenfarne Group LLC’s Magnolia LNG project planned for Louisiana received Energy Department authorization to ship gas to countries that don’t have a free trade agreement with the U.S. That would include Europe, which has seen its gas prices surge as Russia halted flows to Poland and Bulgaria.
The effort comes after Russia said it will keep supplies to Poland and Bulgaria switched off until the two countries agree to Moscow’s demands to pay for the fuel in rubles. The move caused European gas prices to soar as much as 20% before easing. As payment deadlines start falling due, governments and companies across Europe have to decide whether to meet the new rules or face the prospect of gas rationing.
But Golden Pass and Magnolia won’t provide an immediate fix for Europe’s gas woes. Golden Pass is expected to produce its first drops of LNG in 2024, while Magnolia doesn’t yet have any contracts or customers.
“We want to signal we want to partner and make sure our restrictions in the United States of permitting for non-free trade agreement entities like the EU are not a barrier,” Energy Secretary Jennifer Granholm said in an appearance Wednesday with EU Commissioner for Energy Kadri Simson. “And so making sure we are able to allow those who intend to produce have the freedom to ship to Europe as part of that strategy.”
The approvals follow authorizations granted last month to Cheniere Energy Inc., the largest U.S. LNG exporter, to allow the company’s existing facilities in Louisiana and Texas to increase the amount of the heating fuel they are already exporting.
“U.S. fuel supplies, including LNG, continue to play a key role in global energy security, particularly due to Putin’s invasion of Ukraine,” the Energy Department said Wednesday.
U.S. LNG exports have recently averaged more than 12 billion cubic feet per day and are expected to near a record 14 billion cubic feet a day as more export capacity comes online.
“While it will be a few years before the additional LNG volumes actually hit the market, today’s action continues to show that the administration understands how important U.S. LNG exports are for both energy security and climate progress,” said Fred Hutchison, president of the advocacy group LNG Allies.
Hutchison said he “hopes and expects” the Energy Department to approve two requests pending by Sempra Energy for export projects in Mexico that would get their gas from the U.S.
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