The Associated Press reported that China and Russia have launched a 3,750 mile long gas pipeline, “an outcome of their long-planned energy partnership.” China is the world’s largest energy consumer and needs new supply sources to meet their demand while Russia is looking for alternative economic partnerships due to volatile relations with the U.S. and Europe. The pipeline, “Power of Siberia,” is the result of $400 billion deal from 2014 in which Russian state energy company Gazprom agreed to deliver 38 billion cubic meters of natural gas annually to China National Petroleum Corp for the next 30 years. Russian president Vladimir Putin was quoted:
“This step takes Russia-China energy cooperation to a whole new level and brings us closer to achieving the goal set together with Chinese President Xi Jinping of extending bilateral trade turnover to $200 billion in 2024.”
This is just the latest addition to energy expansion by our nation’s adversaries. Too many of our allies in Europe are dependent upon Russia, and increasingly China, to meet their energy needs. The best way the U.S. can counter these developments is to increase investment in our energy exports.
To start, the U.S. must continue to invest in modern pipelines to safely and efficiently transport energy to export terminals along the coast and consumer markets. Pipelines have proven to be the safest, most efficient, and most environmentally-conscious means to move natural gas to markets.
Furthermore, the U.S. must continue to invest in LNG export terminals. A flurry of investment is on the horizon, from Lake Charles LNG in Louisiana, to Eagle LNG in Florida, to FERC’s recent approval of 4 major export projects in Texas.
The U.S. has been trending in the right direction to accomplishing these goals under the Trump administration and his “energy dominance” doctrine that welcomes investment and streamlines regulations to allow economic expansion. The United States recorded its first month as a net petroleum exporter since 1949 last week and is currently the third largest LNG exporter worldwide – and is on pace to become the top LNG exporter in the next five years.