The U.S. can increase LNG exports to Europe

On March 25, political leaders from Europe and the U.S. announced plans to boost Europe’s liquefied natural gas (LNG) imports by at least 15 billion cubic meters (bcm) this year, to help replace declining gas imports from Russia.1 They also stated a longer-term ambition to boost the EU’s demand for U.S. LNG by 50 bcm annually through 2030. The announcement did not specify where additional LNG would be sourced, and U.S. officials made no firm commitments to ship specific volumes of LNG to Europe.

An IEEFA analysis finds that the U.S. LNG industry has the capacity to boost gas exports to Europe by at least 15 bcm this year and more through 2030—without signing any new contracts or building any new infrastructure beyond what is already under construction.

The six fully operational LNG liquefaction terminals in the U.S. can collectively export up to 82 million metric tons (MMt) of LNG per year, or roughly 112 bcm of gas.2 This represents an increase of almost 6 MMt of LNG (8 bcm of gas) over 2021 levels, due to the recent completion of an additional liquefaction train at the Sabine Pass LNG terminal.

In addition, the U.S. LNG industry operated at slightly less than full capacity in 2021, but is on track to operate at full capacity for 2022, boosting total U.S. LNG exports by several million tons this year.

The completion of the Calcasieu Pass LNG terminal, expected later this year, would add 12 MMt of annual liquefaction capacity (16 bcm of gas) to the U.S. LNG fleet, 3.75 MMt of which (5.1 bcm of gas) is contracted to be sold to Europe. Calcasieu Pass is already partially operational, shipping its first commissioning cargoes in early March, and could potentially export several million metric tons of LNG into the global market this year as it ramps up. Still more liquefaction capacity will be online by 2025, when the 15.6 MMt/year (21.4 bcm of gas) Golden Pass LNG export facility is expected to commence operations. Although Golden Pass LNG’s output is contracted to Ocean LNG (an affiliate of ExxonMobil and Qatar Petroleum, the two companies partnering to develop the facility), Ocean LNG has the flexibility to ship LNG to destinations of its choosing.

In short, the U.S. LNG industry—which includes six fully operational plants, one that is partially operational, and one that will come online by 2025—has the capacity to boost its total LNG exports this year and beyond, and to direct substantial LNG volumes to Europe, without sanctioning any new infrastructure or entering into new long-term sales contracts with European buyers.

Press release: Analysis finds U.S. can increase LNG shipments to Europe without building new facilities