EU Regulations Threaten Continued Flow of US LNG to Europe

Copyright © 2025 Energy Intelligence Group

Published: Fri, Oct 17, 2025 Author Eric Thorp, London Editor Mark Davidson

The flow of US LNG to European markets could be upended unless the EU quickly throttles back its new methane limits and corporate reporting regulations, top industry executives warned this week.

The bloc’s Corporate Sustainability Due Diligence Directive (CSDDD) and related methane standard approved in May 2024 are “the worst, most irresponsible piece of legislation I've ever seen passed anywhere in the world,” Exxon Mobil CEO Darren Woods told delegates at the Energy Intelligence Forum 2025 in London.

The methane regulation extends to all producers, exporters and importers wanting to sell gas into the region, with importers required starting this year to report annual methane emissions data — including from countries and companies exporting to the EU.

Starting in 2030, EU gas importers must demonstrate that volumes entering the bloc comply with a yet-to-be-determined methane intensity limit, with hefty fines expected for noncompliance.

Similarly, financial penalties are expected to be issued for noncompliance with the CSDDD, which sets out sustainability reporting rules covering companies operating in the EU or doing business within it.

The EU is under intense pressure to scrap or drastically modify the regulations, which take effect Jan. 1, 2026, if it hopes to continue importing LNG from the US, which industry executives say can’t possibly comply with the stringent requirements.

The US is the largest exporter of LNG to Europe, shipping an average of about 160,000 tons per day so far this year. The US has accounted for 56% of the bloc’s LNG imports so far in 2025.

The EU is currently working on amending the CSDDD through the commission’s Omnibus Simplification Package, with Brussels having already announced that it is aiming to postpone the entry of CSDDD until 2028.

‘Sell Them Less’

Woods said Exxon is “supportive” of the human rights element of CSDDD but slammed the decarbonization element, as it requires plans that are “consistent with the objectives of the Paris accord, which today are unachievable with the existing set of technologies.”

The CEO also raised concerns with CSDDD’s requirement to reduce the emissions of its global customers, suggesting that the only way Exxon could do that would be to “sell them less.”

“And it requires us to do that, not only in Europe, but everywhere we operate around the world. … That, from my standpoint, is untenable,” Woods said.

Woods stressed that the industry is working to reduce pollutants on its own and isn’t opposed to reasonable government oversight. “Regulations that are overly prescriptive or unrealistic or that, frankly, aren't practical and can't be implemented in the short term — I think those are areas that the industry pushes back against,” he said.

‘I Appreciate the Intent’

Woodside CEO Meg O’Neill told the forum that she has no objection to the EU’s intent on being a “global leader in tackling climate change” and agreed that tackling methane emissions is “good business.”

“Why would you let a molecule that can be constructively used be emitted?” said O’Neill, whose Australian-based company owns the Louisiana LNG export project under construction on the US Gulf Coast.

However, O’Neill said the EU had “fallen short in a couple of areas,” including the complex approach it has taken with its energy policy and the proposal to impose financial penalties on companies failing to adhere to the methane regulation.

O’Neill said the legislation stands to inflate already expensive energy prices in Europe and that European industry “is going to be destroyed.”

"I appreciate the intent, but I'd encourage the European lawmakers to be thinking about unintended consequences because this would have, I think, disastrous ramifications across the continent,” O’Neill concluded.

‘Completely Uncompetitive’

ConocoPhillips CEO Ryan Lance echoed the sentiments of Woods and O’Neill, warning that US LNG producers will increasingly turn to Asia if these provisions remain in effect as adopted.

“[CSDDD] is going to make Europe completely uncompetitive. … We'll bypass Europe and go to Asia and to other parts of the world. It's that significant,” Lance told forum delegates.

But Lance said he is hopeful that “sanity” will prevail in the CSDDD conversation and that people will “move in a more constructive path.”

The Qatari Factor

The US isn’t the only major LNG supplier threatening to turn away from Europe. Qatar, the EU’s third-largest LNG supplier behind the US and Russia, has warned it will stop sending LNG to the bloc should sustainability-focused regulations take effect as adopted.

Qatari Energy Minister and QatarEnergy CEO Saad al-Kaabi has vehemently objected to the CSDDD if it faces financial risks for noncompliance. "Put simply, if further changes are not made to CSDDD, the State of Qatar and QatarEnergy will have no choice but to seriously consider alternative markets outside of the EU for our LNG and other products, which offer a more stable and welcoming business environment," al-Kaabi wrote in a letter to the EU in May.

QatarEnergy owns 70% of the $10 billion Golden Pass LNG export terminal, with Exxon owning the remaining 30%. The companies expect the 18.1 million ton per year (2.5 billion cubic feet per day) Texas facility to begin operating by year’s end, with most offtake currently targeting Europe.

Patrick Pouyanne, CEO of longtime QatarEnergy partner TotalEnergies, told the forum that he had spoken to European Commission Director-General for Energy Ditte Juul Jorgensen about CSDDD and the EU's pending methane regulations.

“I told her, look, you need to make pragmatic things,” Pouyanne said, highlighting the complexity of measuring methane emissions in the US, where gas for LNG plants is generally sourced from the grid — meaning it is hard to pinpoint its origin.

Last month, Jorgensen said she was confident the commission can and will "implement the methane regulation in a way that doesn't constitute an irritant in any way.”