LNG

TotalEnergies has raised claims to get reimbursed approximately $1.3 billions for loans to Novatek’s Arctic LNG 2 project, as it completes its exits from the US-sanctioned Russian LNG project.

The United Arab Emirates’ decision to leave OPEC is ushering in a more volatile oil market, with implications for LNG pricing – particularly in Asia, where many contracts remain indexed to crude benchmarks.

Indonesia is turning to LNG-fuelled power generation to ease its stalled coal exit, as international coal retirement efforts struggle. Tenders for small-scale LNG distribution are targeting 41 power plants with 2,148 MW capacity combined in remote regions, with operations expected from late 2026 to 2027.

The European Commission seeks to mobilise €100 billion of clean energy investment whereby US LNG imports are key to phase out the remaining Russian energy in the system, the European Commission’s Ditte Juul Jorgensen said at Gastech 2025 in Milan today.

Burning LNG to balance renewable energy is ‘key’ to exit coal-fired power generation in Asia, a new study by S&P Global Commodity Insights finds. The average lifecycle carbon intensity for LNG sourced from Australia, the US and Qatar and used for electricity production in the study countries was 47% lower than for coal.

CPC Corp, Taiwan’s state energy company, is seeking to import LNG cargoes for August and September after the country’s last nuclear power plant was shut down over the weekend. LNG procurement will be ramped up through a new regas terminal in the Guantang Industrial Area.

CPC Corp, Taiwan’s state-owned energy company, is preparing to ramp up LNG procurement through a new regas terminal in the Guantang Industrial Area. By importing more natural gas, utilities comply with the government’s policy to exit nuclear power by the end of this year.

The Guantang terminal, situated in the north of the island, will give CPC an additional option for importing LNG apart from its Taichung LNG terminal which is also being expanded.

The Taiwanese government wants to replace nuclear power with natural gas and renewables. To that end, the ratio of electricity generated from natural gas is meant to rise to 50%, the ministry of economic affairs said, specifying the mid-2025 as the deadline for the completion of the country’s nuclear exit.

Taipower seeks to adhere to the government’s Nuclear Free Homeland Policy and state-owned CPC Corp consequentially increased LNG imports since early summer last year, and recently got approval to build a new regas terminal at Kaohsiung. Unit 1 of Taipower’s last fully functional nuclear power plant was shuttered on July 27 2024, and the utility currently prepares to decommission Unit 2 in late August or September 2025. This will complete Taiwan’s nuclear exit.

Repowering Talin plant to replace lost nuclear capacity

By that time, however, the country will need to import substantially more LNG as gas-fuelled power station will need to be dispatched for mid-merit or even partly as a baseload power source. Repowering the Talin coal-fired power units to cleaner-burning natural gas is under consideration. Not only would this boost demand for LNG, combusting gas instead of thermal coal would also produce around 95,000 tonnes less sulphur oxide, 50,000 tonnes less nitrogen oxide, and 6.26 million tonnes less carbon dioxide annually.

CPC confirmed it will supply regasified LNG to the repowered Talin power plant at Kaohsiung Port. But the company was quick to add it would also supply gas to power industries, homes, other end-users, and source gas for storage to meet seasonal demand swings.

Plans to increase Taiwan's natural gas reserves from the current 7-day storage level to 14, have already been announced by the country’s Ministry of Economics in October last year. Greater gas storage requirements further add to rising demand for imported LNG. All these factors make the state gas buyer CPC Corp keep a vigilant eye on offerings from long-term LNG deliveries as well as on the spot market.

Though Germany must phase out fossil gas by 2045 to become climate neutral, there is no clear roadmap for exiting natural gas in the power sector and the future role of LNG, the International Energy Agency (IEA) criticises. The German ‘LNG Acceleration Act,’ for once, stipulates an end of LNG imports by 2043 when terminals should be converted to hydrogen.

To meet that timeline, substantial investment in Germany’s traditional gas infrastructure would be required, analysts pointed out.

For repurposing LNG regas terminals to accommodate hydrogen, the key question is temperature. Methane liquefies at −160°C and hydrogen −253°C. The European Network of Transmission System Operators for Gas (ENTSOG) recommends terminal operators to carry out a risk assessment of LNG in order to analyse the impact on the process conditions, properties of mixtures and consequences.

As for storage, Germany has the largest gas storage capacity in the EU with around 40 gas storage facilities holding more than 24 bcm. Up to 1% hydrogen per volume can be blended into an average gas storage facility – while a pipeline that currently carries mainly natural gas can transport about three times as many cubic meters of hydrogen, an ENTSOG-G study finds.

Key gas pipelines in Germany include Nord Stream 1, which used to transport Russian gas through the Baltic Sea; the Yamal-Europe Pipeline, now primarily used to transport natural gas from Germany to Poland; the Trans Europa Naturgas Pipeline, connecting the German and Dutch gas grids; and the Europipe I and II pipelines, which import natural gas from Norway’s North Sea fields into Germany.

Clear timeframe needed for gas-to-H2 conversions

Looking at the power sector, there is currently no roadmap for exiting natural gas in the power sector. Unlike coal, no timeframe has been set out, though the target of 100% fossil-free generation by 2035 indicated the need for speedy gas-to-hydrogen conversions – or utilities face the risk of plant closures.

Uncertainty about tenders for hydrogen-ready power stations or a future capacity market is has made Germany’s largest utilities to withhold investment in new power stations, which, in turn, risks to push up wholesale power prices.

The IEA hence urges the incoming coalition government to clarify the timing of a future gas exit. Timeframes for mandated hydrogen conversions would provide industry with the certainty needed to invest in the required import infrastructure (for both natural gas and hydrogen) and industrial clusters.

Electrification in focus first, hydrogen and CCUS second

The industry in Germany is struggling to stay competitive in the face of rising fuel costs and high electricity prices. To mitigate the risk of deindustrialisation, IEA analysts recommend policymakers in Berlin should concentrate efforts on promoting energy efficiency and electrification” in the short run. The rising adoption of hydrogen and post-combustion carbon capture utilisation and storage (CCUS) are seen as e viable pathways in the longer term.

For now, Germany’s dependency on natural gas continues “without a clear end in sight,” analysts criticise the government’s failure to set out clear policies on how to enact the clean energy transition. The outgoing government’s Power Plant Strategy attempted to tender 12.5 GW of new natural gas-fired power plant capacity that could later run on hydrogen.

“In this way, the construction of new hydrogen-ready gas-fired capacity could avoid a fossil fuel lock-in that is not at odds with the electricity generation target, as long as the fuel switch takes place on time,” analysts acknowledged but called for more clarity around the viability of hydrogen-ready gas plants.

Gas peaking plants are believed to keep playing a vital role in grid balancing beyond 2035. But other flexibility options, notably industrial demand response, storage and interconnections, should be encouraged as these “may displace the need for additional generation capacity,” analysts argue. The IEA hence urges the German government to “move ahead with the future electricity market design proposals, including a capacity mechanism.”