The head of France’s Totalenergies, Patrick Pouyannet, believes the current price for liquefied natural gas (LNG) is still too high, it will probably have to be saved, although he expects LNG demand in Europe to grow by 15-20 million tons in 2023.

The head of the company said in a conference call that European LNG demand in 2022 is down less than 15%, but in 2023, he said, “we’re accelerating.” “We see a trend. There was (in 2022 — IF) a shift in gas consumption to oil (…), there was also a substitution for coal, but in a smaller volume,” he commented. In his view, the current LNG price of $20 per MMbtu “is still too high.”

“Our expectation is that Europe’s LNG imports will be 15-25 MMbtu higher in 2023 than in 2022, but a lot depends on the price,” the Totalenergies head added.

As Pujanne noted, Europe now lives in a new environment where energy prices are higher, so if the consumer “wants to reduce energy bills, we need to consume less.

He also commented on a long-term contract to buy 4 million tons per year of LNG from Russia’s Yamal LNG, where TotalEnergies (NYSE:TTE) owns 20%: TotalEnergies buys LNG at a price tied to the Brent oil price, and sells at the TTFexchange price if it comes to Europe and at the JKM index if LNG goes to Asia, creating “a big cash flow” for the company. The company has stopped spot purchases of LNG from the project.

Pujanne recalled that the company received some but not all of its dividends from Yamal LNG in 2022, and decided to report them only when it received them in its accounts. Industrial production in the Eurozone fell by 1.1% in December and by 0.4% in the EU.

Earlier we reported that the euro zone economy grew by 0.1% in Q4, while the EU GDP remained unchanged.