Germany: long-term or transient LNG market? [Gas in Transition]

Germany: long-term or transient LNG market? [Gas in Transition]

No final investment decision has been taken on onshore regasification plants in Germany. The use of FSRUs – a necessary emergency option – means import capacity can be released. Nonetheless structural factors suggest LNG has a 20-25 year window of opportunity in the world’s fourth largest economy. [Gas in Transition, Volume 3, Issue 2] by: Ross McCracken

Just because a country turns to LNG today, does not necessarily mean it will use it tomorrow. Egypt and Israel are prime examples of countries which brought in floating regasification and storage units (FSRUs) to ensure stable gas supplies, only to make significant offshore gas discoveries and later turn to exports, either pipeline, or, in Egypt’s case, both pipeline and LNG. Mexico has seen its LNG imports plummet not because of an increase in domestic gas production, but because of an influx of imported shale gas from the US. Such is the inflow that Mexico itself expects in coming years to also turn LNG exporter. Argentina’s LNG demand has ebbed and flowed with the level of domestic consumption and the success of its domestic gas production, which still promises a future as an LNG exporter rather than importer. Net zero deadline Germany’s prospects as a long-term LNG market are more complex. Its net zero by 2050 policy and antipathy towards Carbon Capture Utilisation and Storage as a climate change mitigation solution both app...