Posted on Aug 10, 2018
Since the arrival of the first U.S. LNG carrier in the Portuguese port of Sines April 2016 and today, EU imports of liquefied natural gas from the U.S. have increased from zero to 2.8 billion cubic meters.
In their joint statement of 25 July in Washington D.C., President Juncker and President Trump agreed to strengthen EU-U.S. strategic cooperation with respect to energy. In this context, the European Union would import more liquefied natural gas from the United States to diversify and render its energy supply more secure. The EU and the U.S. will therefore work to facilitate trade in liquefied natural gas.
European Commission President Jean-Claude Juncker said: "The European Union is ready to facilitate more imports of liquefied natural gas from the U.S. and this is already the case as we speak. The growing exports of U.S. liquefied natural gas, if priced competitively, could play an increasing and strategic role in EU gas supply; but the U.S. needs to play its role in doing away with red tape restrictions on liquefied natural gas exports. Both sides have much to gain by working together in the energy field."
Commissioner for Climate Action and Energy, Miguel Arias Cañete, said: "Diversification is an important element for ensuring the security of gas supply in the EU. Increasing imports of competitively priced liquefied natural gas from the U.S. is therefore to be welcomed. This is happening at a time when EU indigenous gas production is declining more rapidly than foreseen and there is an accelerated phase-out of coal power plants in the EU."
The EU has co-financed or committed to co-finance LNG infrastructure projects worth over €638 million (see list of projects in Annex 2). In addition to the existing 150 billion cubic meters of spare capacity in the EU, the EU is supporting 14 liquefied natural gas infrastructure projects, which will increase capacity by another 15 billion cubic meters by 2021, which could welcome imports of liquefied natural gas from the U.S., if the market conditions are right and prices competitive.
Currently, U.S. legislation still requires prior regulatory approval for liquefied natural gas exports to Europe.
These restrictions need to be addressed and U.S. rules made easier for U.S. liquefied natural gas to be exported to the EU.
Presidents Juncker and Trump set up an Executive Working Group at their meeting in Washington, D.C. on 25 July.
Since then contacts have taken place between Presidents Juncker and Trump, between EU Trade Commissioner Malmström and U.S. Trade Representative Lighthizer, and between the senior advisers of President Juncker and President Trump (Commission Secretary-General Martin Selmayr and White House Chief Economic Adviser Larry Kudlow).
It has been agreed that on 20 August the Trade Adviser of President Juncker and a senior EU trade official will travel to Washington, D.C. to meet their U.S. counterparts to continue work on implementing the Joint Statement.
In this context, the EU and the U.S. are working within the framework of this Executive Working Group to increase U.S. exports of liquefied natural gas to Europe.
The global liquefied natural gas market is becoming increasingly fluid and competitive. Between 2017 and 2023, global liquefied natural gas trade is expected to grow by more than 100 billion cubic meters, from 391 to 505.
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