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Tags: russia | ukraine | u.s. oil and gas industry | energy | sanctions | europe

Leslie Beyer: Europe Looks to American Energy Producers Once Again

oil pump, Texas
An oil pumpjack setup in Odessa, Texas, pulls oil from the Permian Basin oil field. Since President Joe Biden imposed a ban on Russian oil, the world’s third-largest oil producer, oil producers in the Basin may need to pump more oil to meet demand, in the U.S. and abroad. (Getty Images) 

By    |   Tuesday, 22 March 2022 04:15 PM EDT

Winston Churchill famously said at the end of World War II that the war had been won “on a sea of Texas oil.” Europe once again looks to the U.S. as it faces one of its greatest challenges since the end of that war.

The Russian invasion of Ukraine has once again put in the forefront the impact of reliance on energy exports from rogue nations. As sanctions increase on Russia, the stability of global energy markets will continue to decrease. In turn, energy security will become more and more unpredictable for our allies in Europe, who heavily depend on Russian energy.

Germany's Bold Stop to Nord Stream 2

Currently Russia provides roughly 40% of the natural gas for the European continent. Some countries rely almost exclusively on Russian exports: for example, North Macedonia receives 100%, Finland receives 94%, Slovakia 70% and Germany around 49%. The Germans, who are increasingly reliant on Russian energy, have taken the first step to stop the spigot by cancelling Nord Stream 2 pipeline. Whether sanctions or a prolonged ground war in eastern Europe disrupt the flow, it appears likely the European continent will be forced to completely re-evaluate its energy policy.

In reaction to these fast-moving events, as well as the prolonged energy crisis felt throughout the winter, the EU is expected to wean itself off Russian energy. For starters, the EU is aiming for a 40% reduction in fossil fuel use by 2030 and is requiring EU energy companies to fill their storage tanks with natural gas this summer so that the continent will not be as reliant on Russian gas next winter. Europe’s gas storage is currently 32% full, compared with about 40% a year ago.

If the plan is approved by the member countries, it will surely be a Herculean task, and U.S. energy producers will be key to Europe freeing itself from Russian tyranny and uncertainty.

To replace all (or even a portion) of Russian gas imports to Europe, the U.S. must dramatically increase its LNG exports to the continent. That new capacity will be helpful, but the administration should take immediate action to advance these expansions and expedite permitting for pending applications.

A Matter of National Security

Pipeline infrastructure needs to be expanded in the United States, the Federal Energy Reporting Commission (FERC) permitting process must be streamlined, and states that continue to block new pipeline production need to be reminded of the national security implications of reducing domestic energy reliance. Infrastructure must also be built in Europe to facilitate increases in natural gas imports from the U.S.

To fully aid our friends and allies in Europe to meet their energy needs it will take more than just LNG, it will also take infrastructure investments and implementation of new and evolving technologies. Fortunately, the U.S. energy sector possesses the technology and expertise to assist the Europeans and expand their energy mix. Technologies like CCUS and Geothermal are rapidly being improved and perfected by U.S. energy service companies.

While often not yet scalable at a commercial scale, government investments in this technology will help spur additional investments, leading to a growing number of energy choices. U.S. energy service companies are also working to bring more of the Lithium supply chain to the United States which will aid in expanding our ability to locally produce solar panels and Lithium batteries.

The people of Europe should no longer have their politics determined by their energy reliance on Russia. The U.S. is blessed with enough energy and technological innovation to satisfy our demand and export the surplus.

Together, the U.S. and the EU can work together to ensure that the people on both sides of the Atlantic have access to reliable, affordable and plentiful energy, improving the economic and national security of both regions.
_______________
Leslie Beyer is the CEO of the Energy Workforce and Technology Council, the national trade association for the energy technology and services sector, representing more than 600,000 jobs in the technology-driven energy value chain. The Council works to advance member policy priorities and empower the energy workforce of the future. More info is available at https://energyworkforce.org.

© 2022 Newsmax Finance. All rights reserved.


StreetTalk
Winston Churchill famously said at the end of World War II that the war had been won "on a sea of Texas oil." Europe once again looks to the U.S. as it faces one of its greatest challenges since the end of that war
russia, ukraine, u.s. oil and gas industry, energy, sanctions, europe
689
2022-15-22
Tuesday, 22 March 2022 04:15 PM
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