Germany helps fuel explosion in US gas exports

"At night it's lit up like Las Vegas," said John Allaire, a retired oil and gas engineer, as he looks to the toxic 10-meter-high (33-foot-high) flare rising from a liquefied natural gas (LNG) plant neighboring his coastal property in the southern US state of Louisiana. 

Completed in early 2022, the Calcasieu Pass facility, like others mushrooming up and down the Gulf Coast from New Orleans to Rio Grande, "super-cools" fracked shale gas from the region for export on LNG tankers.  

Germany, where fracking is banned, has become a major customer in recent years, having significantly expanded LNG imports to make up for lost Russian supplies following the invasion of Ukraine.  

"They pollute the air, they pollute the water, and now they want to triple the size of this facility," Allaire said of gas infrastructure set to envelop surrounding wetlands that teem with otters, ducks, fish and shrimp. 

The Calcasieu Pass plant is owned by the Virginia-based LNG giant, Venture Global. The company wants to build an adjoining LNG export facility, dubbed CP2, that will dwarf its older sibling.

 

Germany, which has paid far above the domestic price for US natural gas, is a major funder of the project. In June 2023, German state-owned business Securing Energy for Europe (SEFE) — formerly Gazprom Germania — signed a 20-year contract with Venture Global to import millions of tons of LNG a year from the CP2 facility.  

This would make Venture Global Germany's largest LNG supplier, despite concerns about its environmental record. 

The company's current LNG facility on the border of Allaire's property has been hit with as many as 139 charges of air pollution violations since it started operating in 2022, according to the Louisiana Department of Environmental Quality.  

Shreyas Vasudevan, campaign coordinator at the New Orleans-based environmental nonprofit, the Louisiana Bucket Brigade, told DW that the company is operating "out of compliance" with the US Clean Air Act so it can meet rising demand from customers like Germany.

But for Mike Sabel, CEO of Venture Global LNG, the company is working with SEFE to ensure "security of energy supply for not only Germany but the rest of the European gas market."  

"Germany has acted decisively to diversify its energy portfolio, and LNG will be a vital part of that mix," he said in a statement last June. 

DW approached Venture Global for comment but had not received a response by the time of publication.  

LNG exports: 'Selling it to the highest bidder'

Venture Global's CP2 project has become the focus of efforts to stop an LNG buildout that will see the US double its gas exports by 2035.

Though America produced gas solely for domestic consumption before 2016, it is now the world's biggest exporter of LNG. 

"In the 20 years I was in exploration, production and drilling, not one of those hydrocarbons molecules went offshore," Allaire told DW. "It's a totally different game now. It's about selling it to the highest bidder." 

Natural gas has long been touted as a "bridge" fuel to a fossil-free energy system because it has lower carbon emissions than coal. But LNG is primarily made up of methane, a greenhouse gas around 80 times more powerful than CO2 over a 20-year period. Moreover, the long LNG supply chain is at higher risk of methane leakages.

The US announced rules cracking down on oil and gas sector methane emissions at last year's COP28 climate summit in the United Arab Emirates, but the ongoing LNG build-out appears to contradict such ambition. 

According to a 2019 study by Robert Howarth, a methane expert at Cornell University in the US, the boom in fracked shale gas production in North America alone may be responsible for "over half of all of the increased emissions from fossil fuels globally" over the past decade. 

"LNG exports will eventually account for more greenhouse gas emissions than every car and home and factory in Europe," US climate activist Bill McKibben wrote in an article in December. Projected LNG production will undo all emission reductions in the US since the turn of the century, he added.

     

McKibben referred to a letter sent by 170 scientists to US President Joe Biden in December. In it, they demanded that Biden cancel the permit for the CP2 terminal and end all future LNG projects.  

"The magnitude of the proposed buildout of LNG over the next several years is staggering," the letter said. "Approving CP2 and other LNG projects will undermine your stated goals of meaningfully addressing the climate crisis and put us on a continued path toward escalating climate chaos."   

Another letter signed by 60-odd of Biden's fellow Democratic lawmakers in November asked the Department of Energy to consider "the aggregate impact that the explosive growth in US LNG exports is having on climate, communities, and our economy."

Hundreds of protesters marched in New Orleans last week against the expansion of Venture Global's nearby Plaquemines Parish LNG facility.

Communities living close to the plant, predominantly made up of people of color, will be especially impacted by pollution if severe storms hit the facility, said Bishop Wilfret Johnson, a Plaquemines Parish pastor who opposes the build-out.

"The hurricanes come all the time; that plant is in the flood zone," he told DW, recalling the damage caused by Hurricane Katrina in 2006.    

Has Biden bowed to pressure?

Such pushback from climate-concerned constituents may have influenced the Biden administration.

On Friday, the White House confirmed reports that it would temporarily pause pending approvals on exports from new LNG facilities to non-free trade agreement states such as those in Europe — where around half of all exports went in 2023. 

Meanwhile, the Department of Energy will undertake a review into gas export impacts such as potential energy price inreases for American consumers; and "the latest assessment of the impact of greenhouse gas emissions."

The government statement also referred to the "the perilous impacts of methane on our planet." 

Venture Global's CP2 facility and another 16 proposed LNG export projects will not gain approval until next year at the earliest, according to reporting from the New York Times that broke news of the pause.  

“Such an action would shock the global energy market, having the impact of an economic sanction and send a devastating signal to our allies that they can no longer rely on the United States," said Venture Global spokesperson Shaylyn Hynes in response to the initial reports.

Meanwhile, US Republican presidential hopeful Nikki Haley promised to ramp up LNG production during a speech in New Hampshire on January 21. "We will speed up our permitting," she said. "We'll export as much liquefied natural gas as we can."

Germany a key player in fossil gas boom 

Germany is paying high prices for gas it does not even need, according to reporting by German think tank, The New Climate Institute.  

German gas demand fell by 12% in 2022, in part through greater efficiency and reduced demand following Russia's invasion of Ukraine. Yet it is building a raft of new terminals to receive LNG from the US and other sources such as Qatar. 

Moreover, existing LNG facilities in the US are sufficient to make up the deficit of Russian gas supply in Europe, say energy experts.

"Germany has never had a gas shortage and was able to cope with the winter of 2022 without its own terminals," read a letter by German civil society and environment groups sent to US regulators on January 17 that also called for Venture Global's CP2 facility to be denied a permit.

According to the letter, the German Economic Affairs Ministry has "admitted that Germany was able to obtain supplies via the existing LNG import terminals in Belgium, the Netherlands and France." 

"It's not an infinite resource; this is not a long-term solution," said John Allaire of the rationale that US "freedom gas" will future-proof Europe's energy needs.

"We could be 100% sustainable with renewable energy in the next 10 years if we wanted to be," he added. "But there's so much money in this."

Edited by: Jennifer Collins and Tamsin Walker

This article was updated on January 26 to include the news that the Biden administration is pausing approvals for exports from new LNG facilities.