LNG 10 November, 2017 10:00 am   

Does the LNG come from Russia? Russian propaganda in the Polish newspaper

– This could be the biggest scam in the industry. The liquefied gas, which reaches Europe on American ships, is purchased in Russia – thunders Rzeczpospolita daily. However, it is not about liquefied gas nor about supplies from the USA – writes Wojciech Jakóbik, editor-in-chief of

Sensational news

– The case came out with Monday’s publication of the so-called Paradise Papers. This journalistic investigation reveals how corporations and public figures around the world use tax havens to avoid paying taxes. Journalists from the International Consortium of Investigative Journalists founded among other things by George Soros fund, have determined that in fact American LNG carriers supply the liquefied gas to Western Europe not from the USA, but from Russia. According to the Belgian newspaper “Le Soir” description of the result of the investigation, four US carriers with LNG produced by the Russian company Sibur and filled up in terminal in Ust-Luga near St. Petersburg arrived at the port of Antwerp.  This gas is to be more expensive than what the West buys in Gazprom – we can read in Rzeczpospolita.

Not LNG and not from USA

The problem is that in Ust-Luga there is still no LNG terminal. There is a premises to LPG export, i.e. propane-butane. Therefore it’s not about liquefied gas, but about the fuel that can be found under any gas grill or even in aerosol cosmetics. The use of LNG for this purpose would end up with, respectively, freezing the sausage or defrosting the surface of the body. The LNG terminal in Ust-Luga could be built within the framework of the Baltic LNG project, in which Shell engaged, but due to the low profitability of such projects in the face of oversupply on the liquefied gas market and perhaps due to Western sanctions against Russia, the Dutch are not in a hurry to implement the declaration of a non-binding memorandum on cooperation during construction.

Sibura premises started the work in 2013. In 2015, Russian Sibur sold the LPG terminal in Ust-Luga to the consortium of Gazprombank (on the list of US and EU sanctions) and the Russian Direct Investment Fund (RDIF), as well as investors from the UAE and Singapore. The Paradise Papers reports are not about LNG at all.

The fact that Sibur used to transport Russian LPG from Ust-Luga the Navigator’s service does not mean that American LNG reaching the Europe, actually comes from Russia. There is no connection between LPG Siburu and LNG, which reaches our continent among the others from the United States. It also does not mean that LNG from the US is more expensive than the Gazprom offer.

However, the article from Rzeczpospolita may be popular because of the sensational findings of investigative journalists involved in the Paradise Papers study. This can be used to spread the disinformation about LNG as an alternative to Russian deliveries.

Meanwhile, Fitch agency and the International Energy Agency conclude that in the coming years, liquefied gas can at least force Gazprom to be more flexible with its customers in Europe, which is observed where Russia has no political interest in maintaining a higher price. In a more pessimistic scenario, LNG deliveries will take away the part of the Central and Eastern European market from Gazprom. This may happen through the terminal in Świnoujście. A false thesis linked to false information in Rzeczpospolita supports Russia’s efforts to disavow this perspective in the eyes of the public opinion.

Pact with Rosneft?

The false thesis of Rzeczpospolita’s headline, however, distracts the attention from the fact that the representatives of the US administration could find themselves under the corrupt influence of Russian business. More important findings were included in the transcript of the Senate Intelligence Committee works, before which Donald Trump’s advisor during the Carter Page campaign testified. He admitted that in conversations with the Russians might have arisen an offer to transfer them the part of shares in Russian Rosneft in exchange for the abolition of sanctions against this company. It would be a lucrative option for Exxon Mobil, whose former chief is current Secretary of Rex Tillerson State, but also an impact in coordinated response from the West to the illegal actions of Russia in Ukraine.

It is better to talk about this, and not repeat the popular thesis on propagandist Sputnik that US LNG must be more expensive than Gazprom offer and is not an attractive alternative. These can be found in the Russian media, their relays in Europe, including in Poland. It is a pity, that they also appear in the leading news programme, which I respect for other content.