LNG: Germany Expanding LNG Regas Capacity Despite Drop in Utilisation: NGI

Germany is continuing to expand its LNG regasification capacity despite the country’s gas consumption declining, Natural Gas Intelligence said.

• With two additional FSRUs due online this year, Germany’s total LNG import capacity will rise to 29 bcm/y.
• More LNG is flowing to Europe this winter amid colder weather drawing down storage inventories at a faster rate than previous years.
• However, facilities are coming online despite concerns over falling regasification capacity utilisation rates at existing terminals. This is making it difficult to justify the over $4b in government subsidies required to lease the units.
• European countries are in a balancing act to ensure that they can have sufficient infrastructure and diversified gas supplies to prevent a repeat of the 2022 energy crisis after Russian pipeline flows were curtailed.
• In 2022, Europe’s, and particularly Germany’s lack of adequate regasification capacity meant that lost Russian pipeline flows could not be replaced with LNG, causing TTF to skyrocket.