Access to gas markets: a comparative study on access to LNG terminals in the European Union and the United States.

 
  I. INTRODUCTION 
 II. DEMAND FOR NATURAL GAS IN THE EU AND THE 
     UNITED STATES 
III. GLOBAL LNG MARKETS 
     A. Access to US LNG Terminals 
        1. U.S. Natural Gas Markets--An Overview 
        2. Import Facilities for LNG 
        3. LNG Terminals--Licenses and Permits 
     B. Access to EU natural gas markets 
        1. EU Natural Gas Markets--An Overview 
        2. EC-level and national-level regulation of 
           markets 
        3. Access to existing LNG terminals in the 
           European Union 
 IV. NEW LNG TERMINALS 
  V. EU AND U.S. ACCESS REGIMES--A COMPARISON 
VI. CONCLUSION 

I. INTRODUCTION

World energy markets are going through a profound change. Many countries have moved from a state driven system to a market based system, the prime example being the European Union (EU), where the objective is to create liberalized pan-European energy markets encompassing twenty-seven previously separated and largely monopolized member state markets. (1) This direction, "from-state-to-market," is contrasted with another trend: resource nationalism. (2) Led by many significant petro-states such as Russia and Venezuela, resource nationalism is currently at its heights. (3)

Energy markets have become more international, which has resulted in increased international energy trade and inter-linkages in energy networks. (4) The general trend in the member countries of the International Energy Agency (IEA) is that they become increasingly dependent on the inter-regional gas trade. (5) This is particularly true in Europe, where the indigenous production is rapidly decreasing and dependency on external natural gas suppliers is increasing. (6) The situation in the United States is not as bad, but dependency on external producers is increasing. (7)

Environmental concerns have finally been recognized and now form an integral part of national energy policy objectives. (8) This means increasing reliance on natural gas as the "environmentally friendly" fossil fuel. (9) Coupled with high energy prices and rapidly rising demand for energy, all this has raised concerns over security of supply. Questions that are surfacing include how to manage the international competition over recourses, how to attract the urgently needed investments, and, at the very heart of the discussion, how to maintain the western lifestyle?

This Article focuses on the international competition for liquefied natural gas (LNG). More specifically, it examines the access conditions to LNG re-gasification terminals in the European Union and the United States. After an overview of the current trends in natural gas consumption and LNG trade, the access regime of both the United States and the European Union will be examined. This Article will conclude that the increasingly real competition over LNG and associated investments have had a profound effect on the regulation of LNG terminals in the European Union and the United States. While there are certain differences at the ideological level, the United States being more openly in favor of proprietary use of LNG facilities, (10) the realities of global natural gas markets have aligned practices on both sides of the Atlantic.

II. DEMAND FOR NATURAL GAS IN THE EU AND THE UNITED STATES