By Jack Mintz, September 2, 2022
Last week’s visit to Canada by German Chancellor Olaf Scholz did little to help ease his country’s energy crisis. Germany desperately needs Liquified Natural Gas (LNG) now, not hydrogen that won’t be available in smallish quantities until years from now.
The visit also opened more wounds with Alberta, as the prime minister scoffed there is no “business case” for LNG exports to Germany — a comment that surprised many participants at the Canadian Energy Executive Association Forum held in Banff last Thursday. If anyone can judge whether LNG will be profitable or not, it’s an oil and gas industry willing to invest billions of dollars in it. The real reason Canada still does not have LNG exports today is not the “business case” but the “political case”: federal regulations focused on GHG emissions to the exclusion of Canada’s interest in contributing to the world’s energy and security needs.
Other countries are successfully exporting LNG to Europe and Asia. Australia, the largest LNG exporter though its natural gas production is only about four-fifths ours, has annual LNG capacity of over 85 million tons. Qatar and the United States follow with 77 and 74 million tons, respectively. And many more LNG plants are either under construction or have been approved by governments around the world. The United States, which isn’t that much closer to Europe or Asia than we are, operates eight LNG export terminals, with four more under construction and another 11 approved but not yet being built.