At Senate Foreign Relations Subcommittee hearing, Portman urges Biden administration official on joint US-EU efforts to reduce Europe’s dependence on the Russia

June 9, 2022

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WASHINGTON DC – Today, during a hearing of the Senate Foreign Relations Subcommittee on Europe and Regional Security Cooperation, U.S. Sen. Rob Portman (R-OH) pressed the head of the Department of State Amos Hochstein to get updates on the current efforts of the US-EU Energy Security Task Force to reduce Europe. dependence on Russian fossil fuels and strengthening European energy security. Senator Portman pointed to the roughly $870 million in energy revenues from Europe that continue to fund the Russian war machine, enabling the Kremlin’s continued assault on Ukraine. Portman acknowledged Europe’s efforts to reduce its reliance on Russian energy, most recently through its sixth sanctions package which included a partial ban on Russian oil, but called for more action to curb those. income. He also spoke of the importance of building energy capacity and infrastructure in Europe, such as liquefied natural gas, hydrogen and nuclear energy technology, including through funding from the US International Development Finance Corporation. and the EXIM Bank.

A transcript of Senator Portman’s interrogation can be found below and the video can be found here.

Senator Portman: “Well, thank you first, thank you to the witness, President Shaheen and Ranking Member Johnson for holding this hearing. This is really an important topic. We are now in the 106^e day in the war against Ukraine. I just met a group of Ohioans who are Ukrainian-Americans who are very frustrated with what they see in Ukraine, Russians having superior weapons, and then our sanctions against Russia, global sanctions, are not as effective that they should be. I focused a lot on this issue of energy because that’s where most of the money comes from to finance the war machine. $870 million a day, roughly, from Europe alone in the coffers. With large profit margins, it allows Putin to continue waging this war without the kind of consequences that I hope we could set up. It is therefore good that the European Union is beginning, over a period of six to eight months, to wean itself off Russian oil, but too little, too late. So that’s my biggest concern is that we’re not doing what we need to do to make Putin’s regime feel the pain. 10-12% reduction in their economy, 40-50% reduction in the Ukrainian economy, for example, in the last 106 days. Mr. Hochstein, I understand that you are currently a senior member of the US-EU Energy Security Task Force and again I have said positive things about this, but I have also said that they need to act faster. Can you please provide us with a brief update, maybe you have already done this, and specifically what is in this work plan? We haven’t seen publicly what’s in the work plan. I would love for you to provide me with updates on the progress of this working group as we move forward, but I wonder if you could give us a report, perhaps you have already done so today and that I missed it, especially on the workbench.

Mr. Amos Hochstein, Presidential Coordinator, US Department of State: “Of course, senator. The working group, we have a mechanism called the US-EU Energy Council, which deals with a sort of long-term relationship between the US and the EU. The task force was therefore not created to disrupt this long-term work, but rather to tackle immediate problems. I co-chair the working group with the Head of Cabinet of European Commission President von der Leyen, Bjoern Seibert. We are looking at two parallel things that we want to achieve through this working group. One is to immediately increase the amount of gas entering Europe. We have committed to try, from the United States, to increase that by 15 BCM this year. It is not just LNG from the United States, but from the United States using our diplomatic efforts and creative thinking to supply this gas by pipeline and LNG from around the world. I think we are making significant progress towards this goal. Second, we want to be at a place where we can increase Europe’s LNG supply by 50 billion cubic meters by the end of the decade. But to do this, Europe must take its own steps. It has to build the infrastructure, which it has not done. And he signed contracts – be prepared to sign long-term contracts. You see the work being done in Germany, they have announced the creation of two new LNG terminals. They’re going to have three or four floating LNG terminals for the interim. It should start working – a few should start working by the end of this year. These are the commitments on which the task force has begun to work.

Senator Portman“Can I interrupt you there? I’ve heard so many different estimates of how long it will take to set up these import terminals. You say it could happen in the next six to eight months? »

Mr. Hochstein: “So there are different types of terminals. So there’s the full-time land terminal that takes years to do. It takes five years to build. But in the meantime, if you can get a ship to come, dock in your port, you have an interconnection to build a short pipeline, it can be done in less than a year. So we are going to see some of them in Germany. Accelerate, an American company, has just signed a contract with Finland. It’s going to have one hopefully in October connected to Estonia and then moved to Finland to cater to the Finland-Estonia Baltic markets. So those are the kinds of things we’re going to try to do. We have worked with the Norwegians and there is already an announced increase of five BCMs from an LNG field and terminal in Norway which is now online. It is in its final phase. This will make about five BCMs. Working in North Africa and the Eastern Mediterranean, Israeli gas passes through Egypt and Jordan on its way to Europe as well. So those are the kinds of things about gas, but secondly, as I talked about a little earlier, we also need to reduce gas demand by using much better technology, efficiency standards – there are things we can do right away, some with American companies, some with Asian companies that have the technology to do it. Europe buys 140 BCM of gas pipeline from Russia. It’s not something that’s easy to replace in today’s market. »

Portman: “Are we going to reach our goal of adding 15 this year?”

Mr. Hochstein: “I believe him.”

Portman: “And I see that between January and April, we increased our LNG exports by around 18%, of which around 74% went to Europe. Is there enough infrastructure to be able to absorb what we are sending – these increased quantities? »

Mr. Hochstein: “So for now, yes. But if you look at all the terminals available today, the capacity is full. That’s why we’re working with them on how to address capacity? And there may be another LNG terminal that we can put in place by the end of the year in Albania, so we’re trying to see what we can do with the available infrastructure, the increase in the immediate infrastructure, as well as the long-term infrastructure, and then ensure that the gas is available to supply it.

Portman: “Well, it looks like we’re not going to have enough gas to replace, as you say, this incredible dependency that they’ve unfortunately developed with Russia. So think outside the box, and then I’ll finish my questions. Thank you guys for your indulgence. What else – I mean you mentioned there’s efficiency. That’s great. They’re already more efficient than us. There are technologies to help with that. One thing that some of these countries are still using, nuclear, France in particular, Romania. I was just in Romania last week. They’re going from 20% to 40% nuclear. By the way, they want help from us. Please help us with the EXIM bank to provide them with the loan they need to make this happen. They are a bit frustrated with us. Since they left the Chinese company and have decided to come with us, we need to help them more. But what can we do and else? Hydrogen technology – I mean, is there anything else we can do to kind of leapfrog? Otherwise, it looks to me like we’re going to be playing a catch-up game.

Mr. Hochstein: “I completely agree. So first of all I think they are not necessarily more efficient than us. I think we are more efficient.

Portman: “I’m talking about residential and commercial efficiency standards.

Mr. Hochstein: “Yeah. Me too. Well the standards are there, but because they don’t use things like smart thermostats -“

Portman: “Okay, good, so there’s an opportunity to do more.”

Mr. Hochstein: So we are working with the US private sector and others to see how we can scale up and make the adjustments to these technologies to make sure they match European models. I want to address Romania because I think it is of crucial importance. We have supported their efforts on SMRs, on modular reactors. They are right to be frustrated with us. I am in direct contact with them. I think it’s key for us to support advanced nuclear, and not just traditional, but also SMR. I think Czech Republic, Romania, Poland – see whatever we can do to be helpful there. They need our financial support, not just the EXIM bank. There are feeding studies that need to be done that we should help fund through DFCs, DFCAs, etc. existing. We must therefore take this step of electrification and then of supplying electricity.

Portman: “Well, thank you for being an advocate to go forward aggressively there since they made the decision to go with us rather than China. We have to step up. It will be a model , as you say a model for the region. They have also built cellular power in places like Moldova that desperately need it and don’t want to be so dependent on Russia and factories in Transnistria. So thank you very much for your advocacy in favor of this and let us know if we can be of help.

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