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Explained: What is LNG and why does the EU want so much of it?

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By Jorge Liboreiro
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The EU is engaged in talks with Qatar, Egypt, the US and Israel to secure additional LNG supplies.
The EU is engaged in talks with Qatar, Egypt, the US and Israel to secure additional LNG supplies.   -   Copyright  AP/Copyright 2005 The Associated Press. All rights reserved

The EU is betting big on liquefied natural gas (LNG) to replace the millions of tonnes of gas it currently buys from its main provider: Russia, a state accused of launching an unprovoked war of aggression against Ukraine.

As part of an ambitious plan to strengthen energy independence and deprive the Kremlin of its lucrative fuel sales, the bloc is breaking monthly records for LNG imports.

A recent deal with the United States will provide an extra 15 billion cubic metres (bcm) by the end of the year, with the goal of bumping annual supplies to 50 bcm before 2030.

What makes LNG so attractive for the EU?

LNG is gas that has been cooled down to -162ºC to reach a liquid state, a point at which it becomes about 600 times smaller. This makes LNG easier to transport to import-reliant regions, like the EU, which imports around 90% of its gas needs.

Tanks are shipped and then unloaded at ports equipped with specialised terminals, where the liquid is heated up and returned to its original gaseous state. From there, the gas is transported through pipelines to power plants, factories and households.

Importantly, LNG is produced by a variety of suppliers around the world, including the US, Qatar, Egypt, Israel, Nigeria and Australia, offering the bloc a way to diversify its supply chains while avoiding new dependencies.

On the downside, demand for LNG is extremely high, with operators at maximum capacity and wealthy countries vying for tankers at the same time. Prices have steadily increased in recent months and are expected to remain high as long as the disruption caused by war persists.

In a bid to prevent a race to the bottom between member states, the European Commission has proposed joint purchases of gas, building upon the lessons learned from the procurement of COVID-19 vaccines.

Another major disadvantage is that the existing LNG infrastructure is heavily concentrated in coastal states in Western Europe. This leaves landlocked countries of Central and Eastern Europe mostly disconnected from the network, a situation that perpetuates dependency on Russian pipelines.

Even more worryingly, LNG is a polluting fossil fuel that contributes to climate change. The EU's push to boost imports has been widely criticised by environmental organisations, which argue the strategy contravenes the spirit of the European Green Deal and the commitments made under the Paris Agreement.

"The focus on swapping one source of dirty fuel with another keeps bankrolling environmental destruction and human rights abuses, and will lock in fossil gas for decades to come," said Silvia Pastorelli, a climate campaigner at Greenpeace EU.

Watch the video above to learn more about LNG.