Posted on 06/19/2013 2:12:28 PM PDT by thackney
The American shale gas revolution has led to a strong and growing interest in liquefied natural gas (LNG) exports as a result of domestic supply far outstripping domestic demand, coupled with strong international demand. Current U.S. policy requires Department of Energy (DOE) approval for exports to countries with which the US does not have free trade agreements, based on the sole criteria of whether a requested permit to export would be in the public interest.
This week, the process by which the Department evaluates permits to export LNG was analyzed in earnest by the House Energy & Commerce Committee’s Subcommittee on Energy and Power. Likely anticipating probing questions on the process by which the Department evaluates those permits, DOE Acting Assistant Secretary for Fossil Energy Chris Smith’s previewed testimony avoiding broad topics related to the issue from questioning. Notably off the table? The “merits of pending applications.”
The recent history of DOE’s role in LNG exports suggests such dodging and indecision has been rife.
Only recently did DOE end a two-year freeze on reviewing LNG export applications, after approving a second permit out of the nearly two dozen in queue. Now the new Secretary of Energy has promised a thorough review of the export process going through each one by one. The current rate of approval – one every two years – doesn’t offer much hope or clarity for future exports.
What is clear is that the rest of the world will not stand on the side lines while the US decides whether it wants to participate in the global market for LNG. Recently, the Chairman of ExxonMobil noted that his company was not going to begin a $10 billion project if it is going to take 5 years to complete the initial approval process. That sentiment most likely reflects the views of other major companies who possess the capital and gas reserves to become major exporters.
Removing the current obstacles to facility development and export will lead to a significant capital investment that will create jobs and add to economic growth. As this new industry gets off the ground it will help our balance of trade and contribute to improved global stability.
The benefits don’t end there. As Jason Bordoff argued recently in The Hill, “Encouraging increased global trade in gas fosters more competition, driving down prices that historically have been linked to the price of oil overseas. This has already started to happen in Europe. Lower natural-gas prices can encourage substitution of gas for coal and oil, which is good for the environment and global oil prices. Increased competition also weakens the geopolitical influence of Russia, which has traditionally been a monopoly gas supplier to Europe. National Security Adviser Tom Donilon echoed these benefits of a more global gas market recently at Columbia University.”
Today, we are at a policy crossroads. Either we use our natural gas, technology, and capital to become a world leader in LNG exports or we cede the field to other countries and their national companies. The global boom in shale and natural gas production is good for the global environment and is the next step in the long term trend of decarbonization.
There are no good reasons for slow walking. The two major objections are environmental and narrow self-serving. Some environmentalists don’t like any fossil energy even though natural gas is cleaner burning than coal and that should serve their goals and objectives. The self-serving reason comes from a handful of industrial companies who narrow mindedly think that by constraining exports they will keep natural gas prices artificially low, which will contribute to their bottom lines. That line of thinking either shows a complete lack of understanding of how markets work or a disregard for what is in the best interest of the US economy.
Procrastination to pander is not a policy option; it is the wrong decision.
do greens know we are drinking purified dinosaur pee?
is true science relevant in an age of such stupidity?
If I get 20 more years . I might beat the sea level rises.. or not. ;-]
as to LNG,, no more unsafe than nuclear fuel if handled appropriately.. California is blowin’ emmissions out ifs legislative entitled voter turnouts year after year.. and missing out on so much.. by choice.
Ain’t nothing more “organic” than petroleum.
It’s, like, compost...man.
Analysis: Companies may turn to courts on U.S. natural gas export push
http://www.reuters.com/article/2013/06/18/us-usa-lng-lawsuits-analysis-idUSBRE95H03820130618
Jun 18, 2013
U.S. companies hoping to export natural gas are frustrated by lengthy delays and rule changes as they await U.S. Department of Energy approval of their applications and may turn to the courts to speed up the process.
Both the slow pace of decisions on applications to ship U.S. liquefied natural gas abroad and the process for making those decisions could be challenged, legal sources say.
Potential strategies could be laid out during a House of Representatives panel on Tuesday, which will focus on the current impediments to U.S. LNG exports.
The surge in shale gas production has helped make the United States a leading natural gas-producing nation, and potentially a major exporter. The Obama administration has cautiously embraced the energy boom, while promising to protect the economy from major price spikes from gas exports.
LNG exports are allowed to only a few countries with free-trade agreements with the United States. But others, including large consumers like Japan and India and those outside free-trade pacts, are keen to buy U.S. gas if the DOE approves.
excerpted for Reuters content, continued at link above
why do ya think channel island seals have such well oiled fur. ;-]
“The current rate of approval – one every two years – doesn’t offer much hope or clarity for future exports.”
JOBS,JOBS,JOBS...Delayed/Canceled
The $5 billion Sabine Pass LNG project
http://www.sourcewatch.org/index.php?title=LNG_Terminals
Swag estimate 20% of cost will be onsite labor. (would like to hear real world % for large project)
All the workers are golden arm welders with a package price of $100 per hour. (keep it simple)
No OT a straight 2000 hrs. 200K / worker/year.
ONE BILLION Dollars = 5000 workers for one year.
As the paychecks are cashed and spent the funds echo through the economy producing more work/jobs.
JOBS,JOBS,JOBS...
This is where I agree with Pickens, we need to switch to natural gas trucks and cars while we can. Why export it, it is cheap as hlll now we need to convert fast rather than export it.
The belief that companies will continue invest locally to keep up the supply while at below market prices is wrong.
How do people talk about demand raising prices while ignoring the effect of prices on supply?
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