Exxon expects European gas buyers to commit to long-term supply deals with U.S. sellers, the Financial Times has reported, as Europe has become the most important market for U.S. liquefied gas.
These contracts would be part of a broader commitment that the president of the European Commission Ursula von der Leyen made to President Trump for the EU to buy $750 billion worth of U.S. oil and gas until 2028.
The European Union has been averse to long-term gas commitments for years, in the belief that gas would not be part of its energy mix over the longer term, so spot market purchases and shorter contracts of one to two years were the smarter bet. According to Exxon’s senior vice president of LNG, Peter Clarke, this was starting to change.
Earlier this year, Italy’s Eni inked a 20-year contract with Venture Global for the delivery of 2 million tons of liquefied natural gas annually. Venture Global scored another 20-year deal with Germany’s state gas buyer SEFE, which also sealed an LNG delivery deal with Conoco, for a shorter period of 10 years.
Exxon itself is still building its Golden Pass LNG plant in a joint venture with QatarEnergy. The facility is expected to be commissioned in 2026 and later reach a peak capacity of 15 million tons. A lot of this could end up going into Europe in the context of the EC commitment and President Trump’s recent call on the EU to give up all Russian energy imports.
The EU already imports 55% of its LNG from the United States, up by 20% from last year, according to Exxon’s Clarke. That number could go up to 66% with new long-term commitments and a further shift away from Russian energy, regardless of the cost differentials.
By Irina Slav for Oilprice.com