MOSCOW (MRC) -- Russia’s military intervention in Ukraine will boost liquefied natural gas demand from European countries eager to diversify their access to the fuel, said Hydrocarbonprocessing, citing Hoegh LNG Holdings.
The crisis in Ukraine, which transits more than 15% of Europe’s gas use, may boost demand for floating LNG import terminals such as the one the Hamilton, Bermuda-based company will deliver to Lithuania this year, the first in the former Soviet Union, CEO Sveinung Stoehle said.
“It will create an extra push in demand," he said in an Oslo interview. "It will put even more focus on energy independence, especially on gas. The only way you can be independent on gas is to import LNG."
LNG exports from the US, which is building plants to ship the fuel after a boom in production, will boost global annual supply by about 40 million metric tons in 2017 from today’s 250 million, Stoehle said. That is already creating demand for import terminals and tankers that will extend to European nations such as Ukraine, Belarus, Romania, Italy and Croatia, he said.
The standoff between Russia and Ukraine, which escalated over the weekend when Moscow invaded the Crimean peninsula, should lead US authorities to ease restrictions on gas exports, industry groups and politicians including House Speaker John Boehner said this week.
While the first of six government-approved US export projects won’t start output before next year, the Energy Department is considering at least 24 applications for new terminals.
As MRC reported earlier, Shell and Ukrainian Company "Nadra Yuzovsky" on Thursday, 24 January, in Davos, signed a production sharing agreement (PSA) for the developments of shale gas at Yuzovsky area, Ukraine. Each partner has a 50% interest in the project. Shell will be the operator of the project, responsible for all activities under the agreement. The agreement was signed for a period of 50 years.
MRC