Senate confirms US energy secretary as department mulls LNG exports

16 May 2013 21:43  [Source: ICIS news]

HOUSTON (ICIS)--Ernest Moniz was confirmed as the US secretary of energy on Thursday through a unanimous vote on the Senate floor, taking charge of an agency that is deliberating whether to approve a wave of projects seeking to export LNG.

“We’re hopeful that now a new secretary of energy is in place, in general, and him, particularly, and that we can have some movement on processing these LNG applications,” said Bill Cooper, president of the trade association Center for LNG.

Cooper said the LNG export projects represent billions in future investment and the potential to create thousands of jobs.

Moniz, a nuclear physicist and Massachusetts Institute of Technology (MIT) professor, was overwhelmingly confirmed to lead the Department of Energy (DOE) by a vote of 97 to 0.

In April, Moniz testified in front of the Senate Energy and Natural Resources Committee during his confirmation hearing and received a vote of 21 to 1. Senator Ron Wyden, a Democrat and committee chairman, said in a statement that he looks forward to working with Moniz, who has a record of collaboration.

Wyden has been a staunch and vocal opponent of LNG export projects, particularly of the two proposed in his home state of Oregon. 

The environmental organisation Sierra Club, which has opposed the exports of natural gas, issued a statement urging Moniz to take a “timeout” on exports in order to conduct a rigorous environmental assessment.

“When looking at the full picture of what increased fracking would mean for Americans’ health and future, we are confident the DOE will find that LNG exports are not in the best interest of the American public,” according to a statement by Deb Nardone, a Sierra Club campaign director.

The US Department of Energy is reviewing 25 applications to export LNG from 19 different projects. LNG exporters must seek approval from the DOE in order to export and receive separate approvals for free trade agreement (FTA) and non-FTA countries, which are the major LNG importing countries such as China, Japan and India. 

The DOE has halted any decisions on non-FTA export applications since 2010, citing the need to examine the potential impact of increased LNG exports.

Major manufacturers and downstream producers such as Dow Chemical have raised concerns about the potential for natural gas prices to climb higher should too many export facilities be granted licenses.

US-based Cheniere Energy holds the sole export license to trade with FTA and non-FTA countries for its 18m tonne/year Sabine Pass liquefaction facility in Cameron Parish, Louisiana.

Despite the overhanging uncertainty of regulation, a number of US projects have moved forward with commercial decisions, such as ExxonMobil, which is jointly developing the Golden Pass export facility with LNG heavyweight Qatar Petroleum.

The Golden Pass LNG announced that it reached a commercial framework on 9 May, moving ahead with the project’s marketing of volumes, which could leverage the companies’ position at the UK South Hook LNG terminal.

By: Ruth Liao
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