On Monday the British Telegraph reported that Britain’s prime minister Rishi Sunak will be announcing a major new natural gas deal with the United States shortly after the COP27 climate change summit.

According to the report, Britain is hoping that over the next year, the United States will supply 10 billion cubic meters of liquified natural gas (LNG) to the island nation. The negotiations over the deal are still ongoing and in their final stages. It is expected the official announcement will come in roughly a week or two.

The report also noted that the negotiations are hanging up over final amounts, and it was possible the deal would be announced without specifying agreed-upon amounts. It is also reportedly unclear just how much of the agreed-upon amounts will make their way into the UK energy market by this winter, and how much will be delivered later.

This deal will come shortly after an agreement between the US and the EU, which will see 15 billion cubic meters of LNG delivered to the European Union, as it attempts to cope with the energy crisis that has been produced following Russia’s military operation in Ukraine

National Grid in Britain has noted the UK’s ability to procure gas supplies will depend on them paying enough to attract supplies from suppliers in Europe, Qatar, and the United States. So they will be limited in their ability to reduce the prices they pay.

US LNG producers will see production capacity increase only modestly for the next three years, until 2025. In 2025, US government estimates predict three new plants will be coming online which will add 5.7 billion cubic feet per day to export capacity. Presently US producers have exported roughly 11.75 billion cubic feet per day over this quarter.

As economies have reopened from the Covid-19 pandemic, Asian demand has increased. That has combined with a reduction in Russian gas supplies which have been choked off from the European markets through a mixture of sanctions, technical problems, and outright sabotage, and as a result, gas prices have soared throughout the EU.

As energy prices have skyrocketed, the carnage in the British energy industry has only accelerated. So far this year, 12 British energy suppliers have collapsed, affecting over 2 million customers.