US president's remarks signal support for LNG exports

06 May 2013 19:57  [Source: ICIS news]

HOUSTON (ICIS)--US President Barack Obama has indicated that the US may become a net exporter of natural gas, as the president addressed potential energy relations with Costa Rica during a visit to the Central American nation this weekend. 

The US president met with Costa Rican President Laura Chinchilla and business leaders to address economic ties between the two countries as part of Obama’s first trip to Costa Rica.

During a meeting with leaders of the consortium Central American Integration System (SICA), Obama noted the high costs of electricity in Central America compared with the US – up to three times the cost – and lauded Costa Rica’s reliance on renewable energy sources.

“[It’s] true that because of the extraordinary advances in technology that we've made in the United States, we are likely to be a net natural gas exporter as soon as 2020,” according to a transcript of the president’s remarks.

Obama stated that the decision to export liquefied natural gas (LNG) – if at all –  was still yet to be made.

“I can assure that once I make that decision, then factoring in how we can use that to facilitate lower costs in the hemisphere and Central America will be on my agenda,” he said. 

The US Department of Energy (DOE) is expected to make a ruling on the pending LNG export applications filed by 19 companies proposing to sell LNG exports to nations outside of free-trade agreement (FTA) nations.

Only one US-based company, Cheniere Energy, has an export application to sell LNG to countries outside of non-FTA nations, which include major LNG importers such as Japan, China and India.

Costa Rica is considered an FTA nation, but it does not import LNG due to a lack of infrastructure. In November 2012, Costa Rica’s government stated its intent to consider importing LNG through a feasibility study.

In the US, the DOE has stalled its decision-making on non-FTA export applications since May 2011 after the agency determined that further study on the cumulative impact of increased LNG exports was required.

The DOE issued a two-part study on the effects, as well as held two public comment periods, which closed in the first quarter of 2013.

FTA applications for LNG exports, which are required by law to be granted without undue delay, have been approved in the interim.  

By: Ruth Liao
+1 713 525 2637

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