Russian LNG Exports to EU Up Despite Ban

Notwithstanding European Union’s (EU) ban on Russia’s Liquified Natural Gas (LNG) imports into Europe for its war with Ukraine, the bloc’s member states have increased the same by 19.3% in 2024 y-o-y.

In 2024 the EU has imported 16.65 million tonnes of LNG, a record high since production at Russia’s largest production facility, NOVATEK’s Yamal LNG, began at the end of 2017. This was against 15.21 million tonnes imported in 2022 and 15.18 million tonnes recorded in 2023.

Interestingly, the total LNG imports of EU from across the world declined in 2024 and the decrease was primarily from the US as Russian deliveries sold on the spot markets are cheaper than their US equivalents.

Among all EU countries, Germany’s state-owned firm SEFE Energy has bought 58 shipments accounting for 4.2 million tonnes during the past year representing a staggering 6.5-fold increase over 2023.

Besides Germany, France Belgium and Spain too have emerged as key importers of Russian LNG, according to a new study by Environmental Action Germany (DUH), which threw light on high purchases made by Germany.

SEFE’s imports via the French port of Dunkirk also find their way to Germany indirectly via pipeline connections with France and Belgium.

Due to a lack of transparency of the internal EU gas market the researchers were not able to exactly determine how much Russian LNG reached Germany in the form of pipeline gas. However, it is estimated that Russian LNG accounts for between 3 and 9.2 percent of all German gas imports, the report said.

The report also said that although Germany has not directly purchased LNG supplies from Russia since the beginning of the Russian war of aggression, it has been playing a pivotal role facilitating the record imports of Russian LNG to the EU.

Contractual Obligations

The German government argues that SEFE is bound by existing contractual obligations vis-à-vis Russia’s NOVATEK, which is engaged in the exploration, production, processing and marketing of natural gas and liquid hydrocarbons.

Only an EU-wide ban could allow it to break the agreement invoking force majeure. The lack of transparency of the EU gas system enables the whitewashing of Russian LNG.

The report said that Russian LNG imported via Belgium to Germany is labelled as gas from Belgium in the official German gas import data, even though there is no such thing as Belgian gas.

“The imprecise book keeping by design allows each EU member state to deflect responsibility for the continued imports of Russian LNG and instead point fingers at neighbouring states,” the report explained.

To gain more clarity over the ultimate destination of Russian LNG once it enters the EU system, the report suggested a gas tracking system, which was also supported by Belgian officials. Improved statistical record keeping including the origin of gas imports would also help clarify who ultimately consumes gas delivered in the form of Russian LNG, the report said.

ACWA-SEFE MOU

 Meanwhile, Saudi Arabia’s ACWA Power have signed a “Saudi-German Green Hydrogen Bridge” Memorandum of Understanding (MOU) SEFE in the presence of Saudi Energy Minister

Prince Abdulaziz bin Salman bin Abdulaziz and Germany’s Minister of Finance, Jörg Kukies in Riyadh on Monday.

The MOU aims at producing and exporting green hydrogen and ammonia from Saudi Arabia to Europe and both companies will jointly develop projects with an initial target of exporting 200,000 tons of green hydrogen annually from Saudi Arabia to Europe by 2030.

ACWA Power will serve as the developer, investor, and primary operator of production assets, while SEFE will act as a co-investor and primary off-taker, responsible for marketing the hydrogen across Germany and Europe.