For months, the Trump administration and industry groups have been asserting that EU regulations on methane emissions could result in a sharp decline in — or even an end to — U.S. LNG flows to the EU.
Even as many countries and companies around the world continue to ramp up their use of wind and solar power and explore the potential for a variety of renewable, low-carbon and no-carbon fuels, there’s a growing acknowledgment that natural gas — imperfect as it may be from a climate perspective — will remain a significant part of the global energy mix for decades to come. So why not make natural gas as clean as it can be by reducing emissions of methane — gas’s primary component and a particularly potent greenhouse gas? That’s the driver behind the certified gas movement, the focus of a new Drill Down Report that we discuss in today’s RBN blog.
Three phenomena — the European Union’s laser focus on reducing greenhouse gas (GHG) emissions, the EU’s now-significant reliance on LNG from the U.S., and the impending startup of new LNG export terminals along the Gulf Coast — are converging, with potentially significant implications for gas producers and LNG exporters alike. Starting next year, U.S. and other suppliers that ship LNG to EU member countries will need to begin complying with the EU’s methane emissions reporting requirements — full compliance is mandatory by 2027, and in 2030 and beyond the gas exported to the EU will be expected to meet a to-be-determined methane intensity (MI) target. As we discuss in today’s RBN blog, the EU methane regulations are still a work in progress, but they provide another reason why U.S. gas producers have been increasing their monitoring of methane emissions and their efforts to reduce them.
