Tillerson: U.S. has what it takes to ensure Polish energy security

A Polish company in November signed a five-year contract to get liquefied natural gas from the United States.
By Daniel J. Graeber  |  Jan. 29, 2018 at 5:42 AM
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Jan. 29 (UPI) -- It's U.S. companies, not those in Russia, that have the right products to ensure energy security for Poland, a visiting U.S. secretary of state said.

U.S. Secretary of State Rex Tillerson visited Warsaw during the weekend to pay respect on Holocaust Remembrance Day. Speaking later with Polish Foreign Minister Jacek Czaputowicz, the former Exxon Mobil head said the United States has a role to play in the nation's energy sector.

With shale natural gas production outpacing demand in some U.S. regions, and new infrastructure planned for exporting liquefied natural gas, Tillerson said Poland represents "fertile ground" for expanded business relations between the two countries.

"U.S. companies have the right products and services to contribute to Poland's energy security," he said in his remarks.

Polish Oil and Gas Co., known commonly as PGNiG, signed a five-year contract to secure LNG from the Sabine Pass terminal in Louisiana, the first mid-term contract of its kind, in November. The contract lets PGNiG secure LNG from Centrica, a British company that will deliver up to nine cargoes of LNG from Sabine Pass and send it to the President Lech Kaczyński LNG terminal in Poland.

In December, Russian Foreign Minister Sergei Lavrov said European leaders in Brussels were getting duped into paying for "overpriced American liquefied natural gas."

Commodity pricing group S&P Global Platts said gas prices in Europe were too low to support U.S. LNG imports and globally, a separate report from Fitch Ratings said securing long-term contracts for any of the major LNG players will be challenging as the field gets more crowded.

The Polish company added that, in October, it started looking to book capacity on a planned natural gas pipeline linking Poland to Norway, which could go into service in 2022. Apart from Russia, Norway is one of the main suppliers of natural gas to the European market.

The Nord Stream natural gas pipeline runs through the Baltic Sea to Germany, sending Russian gas to the European market. Russian natural gas company Gazprom wants to double its capacity, though European leaders have expressed anti-trust concerns because Gazprom controls both the transit network and the supplies.

Speaking in Warsaw, Tillerson said the pipeline undermines European energy security and gives the Kremlin a tool to use energy as a "political tool."

"Our opposition is driven by our mutual strategic interest, and we strongly believe that Poland having the means - as well as all of Europe - to diversify its energy supplies is important to Europe's long-term security, and we support many initiatives to develop interconnecting infrastructure to achieve that," he said.

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