GAS LNG 31 July, 2018 10:00 am   

Manuscripts don’t burn. A chance for a new TTIP?

The meeting of the President of the United States and the president of the European Commission surprised the commentators. Above the angry rhetoric, Donald Trump, decided to give a positive a signal to Jean-Claude Juncker, representative of Europe, writes Wojciech Jakóbik, editor-in-chief of

A new opening

The main points that can be found in the official communique from the meeting in Washington is entering in a “new phase” of bilateral relations in trade, that should be beneficial to both sides. USA and the EU want to act together to make the planet more secure and prosperous. The exchange between them amounts a trillion dollars.

For this reason, the US and the EU declared that they will work on dropping the duty fees to zero, removing other barriers for trade and industrial goods. They also aim to develop trade in service, chemistry, pharmaceuticals and soy. Thanks to this, the trade should be more mutual and European farmers would gain access to American market. This record is much more important than the message about LNG and the terminals, because it suggests the consent of the European Commission for the liberalization in the agricultural and chemical sector. Meanwhile, European companies are afraid of it due to the high competition with the US. Polish Grupa Azoty is concerned, but they may gain on liberalization if they receive a price of gas that increases competitiveness, reduced by the cost of gas imported under the controversial Yamal contract.

Words versus facts

The communication shows that Americans and Europeans are to seek to strengthen cooperation in the energy sector. – Europe wants to bring more liquefied gas from the US in order to diversify sources of supply – we read in the communiqué. It is worth stopping on this element. At a conference with Donald Trump, a representative of the European Commission declared that Europe wants more LNG from the USA and that it will build new terminals for liquefied gas for this purpose. This phrase does not disavow the astrological thesis that the collapse of transatlantic relations is inevitable.

However, Juncker’s words prompted some commentators to put forward an optimistic thesis that Juncker pledged to persuade European companies to build new LNG terminals. Unfortunately, in the communication from the meeting, it can be seen that the declaration of LNG from the USA can only be covered by the confirmation of the old policy that the European Union adopted in 2014. In the Energy Security Strategy, it wrote that it intends to diversify sources of gas supply, including using liquefied gas, which may come – again, among others – from the USA. Thus, the unclear statement of the Commission President can only be a reaffirmation of this policy. Incidentally, the shape of the Strategy was also influenced by the Polish negotiators who probably tightened their entries thanks to the initiative of the Energy Union put forward by the Polish government.

However, even without additional action by the European Commission, interest in liquefied gas in Europe is growing. The reason, apart from considerations in the field of energy policy, is the perspective for the industry, i.e. the development of maritime transport fueled by this fuel and small LNG. These are new industries that encourage more players to invest. This is, for example, a key element of the expansion of the terminal in Świnoujście, which apart from additional regasification possibilities is to develop new accompanying services that will give jobs in Poland. Another example is the reactivated project of the terminal in Brunsbuttel, Germany, which will be more an investment in new industry than competition for gas from Russia, which is to reach the country also through the use of the Nord Stream 2 gas pipeline. This project, according to the European Commission has no diversification values that liquefied gas from the USA has. When planning an LNG terminal in Brunsbuttel, Germany appreciates the economic attractiveness of small LNG, and does turn away from Nord Stream 2, as some premature comments suggest.

Manuscripts don’t burn

The energy policy of the European Union will not change under the influence of the Trump-Juncker meeting. However, it heralds a return to talks on a new US-EU trade system that would replace the Transatlantic Trade and Investment Partnership rejected by the US President. Does Trump end this volley and intend to sign a trade treaty with Europe, but does he care for a new arrangement that he could sign on? The words pass away, but the manuscripts do not burn. The system rejected by the US was to facilitate the development of hydrocarbon trade with Europe. The new can go in the same direction, and the Commission confirms that this is in the interests of Europeans. We will see if there will be liberalization in chemistry. The message from Washington may herald further ones, and we should keep our fingers crossed for that, because a new TTIP-like treaty is an opportunity for transatlantic relations.