Demand for LNG has increased this year as EU members seek to reduce their energy dependence on Russia. After becoming the largest buyer of US LNG, the EU appears to be looking for diversification options in the long term. Reuters reported late last month that Germany was in talks with Canada about liquefied natural gas exports from Canada’s east coast, following discussions in the Canadian federal government earlier this year about how it could accelerate the development of two proposed LNG export terminals. “Our view is that the private sector should provide the money for these projects and it should be done on a commercial basis,” Wilkinson told the Globe and Mail. “We are certainly willing to help in the talks with our friends in Germany who are looking for these kinds of supplies to make sure that there are long-term arrangements, contractual arrangements that provide certainty to the private sector.” There is currently one LNG export terminal under construction in Canada — the Shell-led LNG Canada in Kitimat, British Columbia, which is scheduled to begin exports in three years. Due to the size of the investment typically required for LNG export facilities, the full reliance on private financing means that the developers behind the two proposed projects – Pieridae Energy and Repsol – will likely insist on long-term supply deals with their European buyers. But long-term contracts for any form of fossil fuel imports go against the grain of Brussels on climate and emissions reduction commitments, and that could complicate matters for Canada’s LNG export hopes. Both proposed projects are at a very early stage of development, with Pieridae Energy recently saying it was to produce a feasibility study for the Goldboro LNG project after putting it on hold last year. By Irina Slav for Oilprice.com More top reads from Oilprice.com:
