JAKARTA (TheInsiderStories) – The European Union (EU) announced that liquefied natural gas (LNG) imports from United States (US) have climbed 272 percent since 2016. The steepest increases occurred after President Donald Trump met with European Commission President Jean-Claude Juncker to hash out a trade deal last year.
The EU also announced the big statistic in kicking off a high-level meeting between US and European business leaders in Brussels on ways to further enhance the LNG trade, featuring Energy Secretary Rick Perry and EU Commissioner for Climate Action and Energy Miguel Arias Cañete.
In their Joint Statement of July, 25, 2018 in Washington DC, Juncker and Trump agreed to strengthen EU, US strategic cooperation with respected to the energy. They came in particular to an understanding of the benefits of expanded exports of US LNG to the EU gas market.
Since the first cargo in April 2016, US’ LNG exports to the EU have been increasing substantially and have seen a steep rise. As a result, on March 2019, recorded the highest volume ever of EU – US trade in LNG with more than 1.4 billion cubic meters.
It said, increased cooperation between US and Europe will include a range of infrastructure projects, from building new pipelines to LNG import terminals, the EU statement said.
The Trump administration has been working to help the EU wean itself off of Russian energy supplies, and has opposed pipeline projects like the Nordstream II pipeline to deliver natural gas from Russia into Germany.
The administration has argued that Europe’ reliance on Russian natural gas would leave it dependent on a country that has been known to tighten the energy spigot on customers that don’t toe Moscow’s line.
Perry didn’t make reference to needing cut the energy dependence with Russia in his statement. However, Cañete said energy security is one of the “key success stories” of US – EU cooperation.
Rising imports of US LNG contribute to the EU’ goal of diversification of energy supply. Competitive, fluid and stable, the EU gas market is the second biggest single gas market in the world after the US.
European gas imports are projected to increase in the years to come as its domestic production is decreasing, while demand is projected to remain at a comparable level as gas has been identified as an important transition fuel in the EU’s efforts to decarbonize its economy.
The EU has well-developed LNG import capacities, with about 150 billion cubic meters currently spare. At the same time, given their strategic importance for diversification and supply security, current capacities are being expanded and new capacities are being developed.
Most recent developments included the signature of a grant agreement between the Polish government and the Polskie LNG, on April 24. The EU invested almost €128 million from the European Regional Development Fund in extending this terminal, this comes on top of €224 million already invested under the previous funding period.
The final investment decision of the LNG terminal on the island of Krk in Croatia in January 2019. The EU has contributed with a total of €124 million(including €108 million for the terminal and €16 million for the evacuation pipeline).
Meanwhile, since July 2018, cumulative EU imports of LNG from the US have increased by 272 percent. With a share of 12.6 percent of EU-LNG imports in 2019 so far, the US is Europe’s third-biggest supplier of LNG, while Europe has emerged the primary destination of the US LNG in January to February this year ahead of Asia.
The EU is ready to facilitate more imports of LNG from the US if the market conditions are right and prices competitive. This will allow US exporters to further strengthen their position on European markets whilst contributing to the EU’s objectives of security of supply and diversification.
In terms of the EU’ total imports of LNG, the US share was 13.4 percent over the last six months, compared to 2.3 percent before the Joint Statement.
Since early 2016, the EU has received more than 110 LNG cargoes from the US. In 2017 Europe represented more than 10 percent of total US’ LNG exports, up from 5 percent in 2016. In 2018, some 11 percent of LNG exports went to the EU market.
However, in the nine month period since the Joint Statement (August 2018 – April 2019), this share rises to nearly 30 percent.
Written by Lexy Nantu, Email: email@example.com