LNG as an energy source for economies around the Baltic Sea
World energy use is constantly increasing, and countries around the Baltic Sea are no exception. The energy issue is closely linked with major environmental issues such as climate change, acidification and over-fertilization. Today, the world is dependent on oil as an energy source. It contains many harmful components and replacing it would benefit the environment. Oil is rich in carbon, which means high carbon dioxide (CO2) emissions when combusted. Natural gas is also a fossil fuel, but is a better source of energy in terms of CO2 emissions and environmental effects. The main natural gas producers includes countries such as Russia; the United States, Canada, United Kingdom, The Netherlands, Iran, Norway, Algeria, Indonesia, and Saudi Arabia. Because of the difficulty of transporting natural gas over long distances, natural gas has been generally imported by close regional neighbors of gas producers.
Energy security is a very important issue in current international relations. There is an increasing dependency of the energy-consuming countries on the energy-producing countries. The situation of Europe and especially Baltic Sea Region is an example. There are no large natural gas supplies in Eastern Europe, so Russia is a dominant supplier of gas to Baltic countries such as Estonia, Finland, Latvia and Lithuania and Poland. This part of the Baltic region is still an energy island, because of energy isolation and dependence on a single source. Therefore, in an emergency situation, these countries do not have any alternative solution to assure continuous supplies of natural gas. That’s why diversification of energy sources of these Baltic countries becomes a priority for the entire Baltic Sea region, as well as the whole European Union.
Transporting natural gas through pipelines is an obvious choice for importing natural gas from nearby producers. However, in order not to be dependent on nearby gas producers (or those located further away), building long-distance pipelines across oceans or mountains is very expensive and introduces various challenges. A technology which is changing distance limitations and is cheaper at long-distance is liquefaction. Cooling down natural gas to -162°C turns it into a liquid (LNG). This process reduces the volume of natural gas significantly. As a cryogenic liquid, it takes up about 1/600 of the volume of uncompressed gas. As a result, natural gas in its liquid form is an easier product to store and to transport. Hence, LNG provides an excellent way to diversify Baltic counties’ energy sources away from Russia. However, LNG import terminals must be constructed.
LNG is also considered as an alternative source of energy by another two Baltic countries, Sweden and Denmark. In Sweden, natural gas is used to cover only 2% of the total energy input. Some of the most densely populated areas are covered by the pipeline network, but there is still a great area of the country left, including larger cities such as Stockholm, Uppsala and Linköping as well as some industrial areas . The absence of natural gas causes that these regions have to rely on fuel oil, coke or coal. If these sources of energy were replaced by natural gas, great environmental benefits could be achieved. Natural gas could be delivered to these regions as LNG if special LNG import terminals were constructed. In turn, Denmark is expected to rely on pipeline gas from offshore North Sea fields in the mediumterm. Existing pipelines and existing contracts will give this county a sufficient supply in the near future. However, in the long-term, LNG is considered as an alternative source of energy.