An ExxonMobil (XOM, Financial) executive highlighted that developing new liquefied natural gas (LNG) supplies takes time, with significant new capacity expected to come online in the coming years. Following the loss of Russian pipeline gas via Ukraine, Europe has increasingly turned to LNG to fill the supply gap, driving up demand.
ExxonMobil currently has four LNG projects under development. The company plans to begin testing production facilities in the U.S. and Qatar by the end of this year. While other U.S. export projects will also start increasing output, the majority of the new supply isn't expected until 2027. According to Philippe Ducom, President of ExxonMobil Europe, substantial new LNG capacity will not be operational until 2026-2027.
The United States is the world's largest LNG exporter. Earlier this month, President Trump lifted the freeze on new LNG export licenses imposed by his predecessor, Joe Biden. However, these projects are not expected to be operational before 2031. Ducom noted that Europe has been hesitant to commit to long-term contracts, which impacts supply security considerations. Investors in new LNG projects need to make significant financial decisions to initiate these projects.
