The Ticking Time Bomb in Europe's Energy Crisis

Few people know about one of the most important anniversaries for the United States. 

There’s no national holiday for it, families don’t take trips to the beach thanks to a long weekend, and you won’t see a grand fireworks display celebrating it. 

In fact, we’re quickly coming up on this anniversary.

I’ll even give you the date: August 11, 2010. 

If you’re asking yourself what could possibly be so important that took place nearly 12 years ago to the day, don’t feel too bad.

You’re not alone. 

Still drawing a blank?

Well, an event took place that day that changed the course of the U.S. energy sector forever. It took place on the 31st floor of a Fifth Avenue skyscraper in New York City. 

You see, that was the day a bulky package was dropped in the mail. 

And it took less than a day to reach its destination in Washington, D.C., at the Docket Room of the Office of Fossil Energy. 

To be fair, it wasn’t the only package that found itself in the Docket Room, with dozens of similar envelopes making their way to John Anderson’s desk over the next few years. 

So what’s all the excitement over?

This was the first application asking the Department of Energy to allow a company to export domestically produced liquefied natural gas. Specifically, it wanted to export up to 16 million tonnes of LNG per year for 30 years. 

It only took a few weeks for the application to be approved. 

That, dear reader, was the moment the U.S. put us on a path to long-term energy dominance. 

Remember, drillers at the time had started to tap into the massive amount of tight gas resources in the lower 48 states, like the Marcellus Shale. 

Today, more than 35 billion cubic feet of natural gas per day flows out of Marcellus wells, making it one of the most valuable resources beneath U.S. soil. 

But there was one major issue to overcome to fully take advantage of this wealth of natural gas. 

Up until that point, virtually all of the natural gas was restricted to regional markets. That’s simply how things worked, given that you needed a network of pipelines to transport your gas to market. 

However, Cheniere changed that game forever after it got the green light from the Department of Energy to export LNG. 

And then it happened… on February 24, 2016, at 7:39 p.m. local time.

That’s when the first LNG tanker set sail out of Cheniere Energy’s Sabine Pass export terminal in Louisiana. 

Today, people are starting to finally realize just how vital that event in 2010 was for us.

Here we are, almost seven years after Cheniere shipped its first cargo to Asia, and the United States is officially the world’s largest exporter of LNG. 

It couldn’t have come at a better time.

Last week, we talked about the European energy crisis that’s hiding in plain sight. It turns out that Putin is squeezing every advantage he can out of Europe’s (and specifically Germany’s) heavy reliance on Russian natural gas. 

Recently, Putin announced that natural gas flows to Europe via the Nord Stream 1 would be cut to 20% of the pipeline’s capacity. 

That puts EU members like Germany in desperation mode. As it stands now, Germany’s gas storage is sitting around 67% full. In order to survive the upcoming winter, that storage level needs to be around 90% with gas flows from the Nord Stream 1 pipeline at 100%. 

See the problem?

I’d give you three guesses as to where Germany will turn for more gas, but I have a sneaky feeling you’ll only need one. 

Right now, the EU and the United Kingdom are our biggest customers for LNG, which is how the United States officially became the world’s largest LNG exporter during the first half of 2022. 

The good news is that investors like us don’t have to worry about getting a case of FOMO from this. 

Most investors don’t realize that the EU is taking steps right now to ensure that the flood of U.S. LNG continues flowing to Europe. Germany has already kick-started plans for new LNG import facilities to wean itself off of Russian gas. 

Keep in mind that these import facilities will take years to complete. Two onshore sites are already under construction, and another four floating LNG import terminals are still in the planning stages. 

You can bet Germany will fast-track these projects. 

More importantly, you haven’t missed the boat yet, and going forward we’ll be discussing some of the best hidden LNG stocks in today’s market. 

Until next time,

Keith Kohl

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A true insider in the technology and energy markets, Keith’s research has helped everyday investors capitalize from the rapid adoption of new technology trends and energy transitions. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital, as well as the investment director of Angel Publishing’s Energy Investor and Technology and Opportunity.

For nearly two decades, Keith has been providing in-depth coverage of the hottest investment trends before they go mainstream — from the shale oil and gas boom in the United States to the red-hot EV revolution currently underway. Keith and his readers have banked hundreds of winning trades on the 5G rollout and on key advancements in robotics and AI technology.

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