US chem-producer coalition call on restrictions of LNG exports

10 January 2013 23:53  [Source: ICIS news]

HOUSTON (ICIS)--A new coalition including US chemical manufacturers and public gas distributors has emerged to campaign for the restriction of natural gas exports as LNG, calling on the public to keep the fuel protected for domestic use, the group said in a statement on Thursday.

This has spurred debate in Washington over the policy decisions around pending LNG export projects awaiting final approval from the US Department of Energy (DOE).

As a result of the US shale gas renaissance, a wave of major energy producers and midstream companies have proposed LNG export plans at either existing import terminals or as greenfield or floating projects during the last two years. 

Twenty liquefaction projects have applied for export approval from the energy agency. Cheniere’s planned 18m tonne/year Sabine Pass in Cameron Parish, Louisiana, is the sole export facility with full export approval from the DOE.

But concerns around the potential for increasing natural gas prices domestically as a result of increasing LNG exports has triggered opposition from chemical and industrial manufacturers seeking to protect natural gas prices and limit LNG export approval.

The organisation, known as America’s Energy Advantage, announced the results of a survey of registered voters that showed a majority of respondents opposed unrestricted natural gas exports and supported domestic use of natural gas.

The US-based members of the coalition include the American Public Gas Association (APGA), which represents publicly owned local natural gas distributors, chemical producers Dow Chemical, Celanese and Eastman Chemical, alumina giant Alcoa and steel producer Nucor.

Also on Thursday, Democrat US Senator Ron Wyden, of Oregon, wrote to US Energy Secretary Steven Chu of a letter that pointed out flaws in a recent study on macroeconomic impacts of LNG exports that was commissioned by the US Department of Energy (DOE).

Wyden, an incoming chair of the Senate Energy and Natural Resources Committee, called for “proper, transparent mechanisms” to be in place for the agency to consider the pending LNG export applications.

Wyden is requesting that the federal agency to correct the flaws before using the study for any decisions on pending LNG export projects.

Wyden also asked for assurance that the US economy would not be damaged by large-scale LNG exports.

In December 2012, the DOE released the study by the third-party consultant NERA and opened a 45-day comment period for public feedback until 25 January.

A response period for 30 days will then be opened, and the DOE expects to begin acting on the pending applications starting in late February. 

Precedence will be given on 15 of the applications because of the projects’ permitting applications already in progress through the US Federal Energy Regulatory Commission (FERC).

By: Ruth Liao
+1 713 525 2637

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