Russia’s war in Ukraine continues to cause supply chain issues. As European countries seek alternatives to Russian gas, American energy companies are capitalizing on the demand. As a result, we anticipate seeing an increased need for talent and more job opportunities in the energy sector.
With Russia flexing its economic muscles in an effort to pressurize countries opposing its war in Ukraine, Europe has had no choice but to seek alternatives to Russian gas.
Perhaps unsurprisingly, the US gas industry grabbed this opportunity with both hands. A letter arrived at the White House in response to the anticipated energy deficit, it suggested escalation of US gas production and improvement of opportunities for exporting to the Euro zone.
The letter received the desired response from Biden’s administration. The demands have become policy and have created opportunities for new pipelines and export facilities.
“I can’t even begin to tell you how much the momentum has changed for companies in the United States that have wanted to bring their projects forward and just haven’t been able to get long-term contracts,” said Fred Hutchison, president of LNG Allies.
LNG Allies, asked for six gas export applications to be expedited, and three weeks after, the US Department of Energy had agreed to two of them. (Cheniere Energy’s Sabine Pass project in Louisiana and its Corpus Christi operation in Texas).
This will help the Biden administration’s commitment to supply the European Union with at least 15 billion cubic meters of gas, by the end of 2022.
The US only began shipping LNG overseas quite recently (in 2016) but it is now reported to be the largest exporter worldwide.
What will this mean for the US domestic LNG market?
Although it is the Russia-Ukraine conflict that has sparked this new direction for the US market, it is suggested that the new gas infrastructure won’t be operational for several years, causing concern for the impact this will have on the US’s domestic supply.
Clark Williams-Derry, analyst at the Institute for Energy Economics and Financial Analysis, suggested that with so much LNG export is planned, that it will likely cause prices for domestic American market are likely to rise.
“It’s beginning to eat into the amount of gas available to domestic consumers,” said Williams-Derry. “We will see very severe impacts on domestic US gas prices. We will see the impacts for as long as the eye can see.”
Texas focuses on LNG production
In the shale fields of Texas, producers are rushing to capitalize on this new trend in the space, and struggling to keep up with demand.
This isn’t unique to Texas either (Texas is the largest producer of natural gas in the US, with Pennsylvania a close second). Around the world, the domestic supply of natural gas is struggling to keep up with demand. Describing this trend, Leo Mariani, an Austin-based analyst at MKM Holdings LLC, said:
“The commodities folks have somewhat ignored the big growth that we’ve seen in the gas-rig count versus last year. It seems like oil’s gotten hit hard with concerns over the economy recently and gas has quietly just done really well on a relative basis this year.”
How will this impact gas and power recruitment?
We anticipate this trend to have pronounced knock-on effects for energy recruitment – namely in the form of increased demand for skilled workers.
For example, when gas prices spiked earlier this year, Reuters reported that an investment bank in the US, TD Securities, was “beefing up its natural gas trading desk”. A similar pattern was evident elsewhere, with various LNG companies recruiting gas trading and supply teams.
We have seen an overall increase in natural gas and LNG-related jobs resulting from a significant increase in energy investment and increasingly volatile natural gas markets. Alongside this, though, has been significant growth in renewable energy investments causing a similarly impressive spike in the demand for candidates with this skillset.
If you are looking to hire, please reach out to Aurex Group and we will connect you with the right consultant. If you are a candidate with a background in gas, power, or LNG, please check our jobs page or contact us to discuss your experience, skills, and future aspirations. We always look forward to keeping in touch and exchanging ideas, insights, and opinions.
https://www.theguardian.com/environment/2022/sep/22/gas-industry-ukraine-war-biden-policy https://www.worldoil.com/news/2022/9/26/natural-gas-from-texas-shale-fields-becoming-more-coveted-than-oil/ https://www.eia.gov/energyexplained/natural-gas/where-our-natural-gas-comes-from.php
Managing Director | Partner, Americas
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