Mr Bennett Resnik, Vermont Law School
There remains considerable debate as global warming continues, with an increasing recognition around the globe for the need to reduce our collective carbon footprint. Yet, from the kitchen table to the U.S. Capitol, disagreement remains over the benefits of renewable energies versus traditional sources like coal, natural gas, and oil. Business leaders, policy makers, and the general public generally seek lower carbon energy sources but struggle to accurately determine their cost effectiveness. Many see the future of energy to be in natural gas.
The unconventional shale gas revolution has catapulted the United States past Russia in total gas output, and recent Federal Energy Regulatory Commission activities reports make liquefied natural gas (“LNG”) export activities in the United States a threat to Russian natural gas dominance in the Asian-Pacific markets. Russia has reacted by implementing legislation to open up LNG exports to companies other than Gazprom. Russia’s liberalization of their LNG export market will impact the global LNG and natural gas markets.
Russia’s liberalization of their LNG export market is in the hopes of increasing their global market share in LNG. One major challenge is the question of how profitable the Russian exports may be. Russia wants to double its share in the global LNG market by 2020 from its current 4.5 percent. Russia’s LNG liberalization is limited at this point to Rosneft, Novatek, state-owned Zarubezhneft and Gazprom itself. It is unlikely that Russia will meet its goal by 2020; however, Russia will gain significant market share so as to compete with the United States. These policy changes and economic gains will provide Russia with the necessary momentum to launch them into future market share gains.
This paper will discuss the potential impacts and effects of Russia’s new energy strategy on the global market. This paper is a commentary on Russia’s plans to compete with the United States in LNG exports, increasing their influence in the Asian-Pacific marketplace.Resnik-A-new-Russian-Revolution-Liberalisation-of-LNG.pdf 1.3 MB