Canada is exploring whether a “business case” can be made for exporting liquefied natural gas (LNG) to Europe, Prime Minister Justin Trudeau has said, as European nations seek alternative energy sources to move away from Russian supplies.
Speaking alongside German Chancellor Olaf Scholz during a news conference in Montreal, Trudeau said on Monday that such exports pose logistical and financial challenges, but that his government would do everything it could to boost global energy supply amid the war in Ukraine. .
Economic talks about possible LNG exports are taking place between Canadian and German companies, Trudeau told reporters.
“We will do what we can to contribute to the global energy supply by increasing our capacities in the short term, and we will explore ways to see if it makes sense… and if there is a business case for it, to export LNG directly to Europe,” Trudeau said.
But he added that one of the challenges is the investment needed to build LNG export infrastructure, stressing that Canada’s “best capability” at the moment is to increase overall global energy supplies.
“LNG conversion plants are generally located close to LNG sources, and while we look at the possibility that LNG plants on the East Coast could be shipped to Germany, we find ourselves a long way from the gas fields in West Germany. Canada,” Trudeau said. he said.
“It’s doable, we have infrastructure around that, but we’re looking a lot at how we can best help, and right now our best ability is to continue to contribute to the global market, to displace gas and energy that Germany and Europe can then locate from elsewhere. sources.”
Russian President Vladimir Putin has repeatedly warned that his country’s natural gas supply to Europe could see dramatic cuts amid international sanctions over the war in Ukraine.
“Russia is no longer a reliable trading partner,” Scholz said Monday. “He has reduced gas deliveries in all parts of Europe, always citing technical reasons that never existed. And that’s why it’s important not to fall into Putin’s trap.”
Russia’s state gas company Gazprom cut gas deliveries through the Nord Stream 1 pipeline to Germany by 60 percent in June, citing alleged technical problems related to the turbine its partner Siemens Energy shipped to Canada for inspection. review and could not be returned due to penalties. war tax.
The pipeline will also be shut down for three days of maintenance at the end of this month, Gazprom announced last week, adding to economic pressure on Germany and other European countries that rely on the fuel to power industry, generate electricity and heat homes.
Canada, home to the Alberta oil sands, is the fifth largest oil producer in the world, according to to the government, and earlier this year announced plans to increase oil and gas production to help its allies in Europe distance themselves from Russia.
The European Union relies heavily on Russia for its energy needs, with Moscow supplying roughly 40 percent of the bloc’s natural gas last year.
“Our European friends and allies need Canada and others to step up,” Jonathan Wilkinson, Canada’s natural resources minister, said in March. “They tell us that they need our help to get out of Russian oil and gas in the short term, while accelerating the energy transition across the continent. Canada is in a unique position to help with both.”
Pro-oil lobbyists and conservative politicians in Canada have urged the government to increase energy production, but environmentalists have criticized that push, saying any increase, even short-term, will prevent Canada from fulfilling its promise to address the climate crisis.
Experts have also pointed out that Canada will not be able to increase LNG exports in time to meet Europe’s needs.
“Due to climate commitments and energy security concerns, Europe is accelerating its plans to reduce gas use by increasing energy efficiency and the use of renewable energy sources. While there may be demand for some fossil fuels, markets like Norway are more logical to meet immediate needs,” the International Institute for Sustainable Development, an international think tank, said recently. said.
“This results in a fundamental mismatch with Canadian supply opportunities. Canada cannot increase supply before 2025, while Europe’s energy needs will be largely resolved by then.”
Canada is considering an LNG expansion agreement with Germany to help meet short-term energy needs.
Not only will this deal make it impossible for Canada to meet its climate commitments, but it also won’t help the EU move away from Russian gas in time, finds a new @IISD_Energy brief. pic.twitter.com/bdFsRzd34S
— Tzeporah Berman (@Tzeporah) August 16, 2022
Germany fears a further reduction in natural gas supplies from Russia this winter in retaliation for Western sanctions following the invasion of Ukraine, Economy Minister Robert Habeck told German broadcaster ARD on Monday.
In an interview with the Reuters news agency last week, Wilkinson, Canada’s natural resources minister, underlined the country’s potential to provide clean hydrogen to Germany and the rest of Europe rather than trying to build LNG terminals as it grows. the world is moving away from fossil fuels.
On Tuesday, Canada and Germany will sign an agreement in Newfoundland to develop clean hydrogen for export to Germany starting in 2025, Wilkinson said.
“Canada plays a very, very central role in the development of green hydrogen,” Scholz, the German chancellor, said during Monday’s press conference with Trudeau. “That is why we are very happy to be able to expand our cooperation in this area on this occasion as well.”