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It is not in the Public Interest for DOE to Approve LNG Export Volumes to Levels which will Connect Low Domestic Prices to High Global LNG Market Prices, like Crude Oil is Today

Paul Cicio's picture
President & CEO Industrial Energy Consumers of America

The Industrial Energy Consumers of America is a nonpartisan association of leading manufacturing companies with $1.1 trillion in annual sales, over 4,200 facilities nationwide, and with more than...

  • Member since 2018
  • 7 items added with 6,824 views
  • Sep 15, 2018 12:30 am GMT

The Industrial Energy Consumers of America filed comments for the record in regards to the hearing to “Examine the Role of U.S. LNG in Meeting European Energy Demand” in the Senate Committee on Energy and Natural Resources and made the following points.

1. It is NOT in the public interest to approve LNG export volumes to levels which will connect low domestic prices to high global LNG market prices, like crude oil is today. The U.S. has high gasoline prices because crude oil is connected to global markets. The U.S. Department of Energy (DOE) has not given this concern any consideration.

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2. Shipments of U.S. LNG to the EU reduces U.S. manufacturing sector competitiveness relative to the EU manufacturing sector.
3. The NGA and its non-free trade agreement (NFTA) public interest provision has not been a deterrent to LNG exports going to the EU or anywhere else.

4. The U.S. delivered LNG price to the EU sets a price ceiling for Russia, Qatar, and Norway from which to reduce their price and ensure their market shares. Their costs are lower.

5. Although ample EU LNG import capacity already exists, the EU has purchased only 10.6 percent of all cargos from the U.S.

6. Availability of U.S. LNG export capacity gives the EU (our allies) the assurances of supply without the obligation to purchase.

See also Re: Hearing to Examine the Role of U.S. LNG in Meeting European Energy Demand, letter sent to Committee on Energy and Natural Resources, U.S. Senate, Chairman Murkowski and Ranking Member Cantwell

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Bob Meinetz's picture
Bob Meinetz on Sep 15, 2018

Marnie, I agree - it's not in the public interest for the U.S. to export LNG, but not because the DOE hasn't given it consideration. The Trump Administration has considered it and decided it's worth throwing the public under the bus to benefit oil companies, and the Republican SuperPACs they support, in anticipation of November's election.

Under the bus with the public goes anything which gets in the way of natural gas's move to dominate US electricity - including climate change considerations and zero-carbon nuclear energy.

Since 2005 public interest, which acquired collective status under FDR's New Deal, has played only a bit part in energy policy and only at the state level - an arena fraught with corruption and influence-peddling. If only we could figure out a way to keep CO2 emissions within the borders of the state where they're emitted we might see some environmental justice for the public at large.

Allen Putnam's picture
Allen Putnam on Sep 24, 2018

Bob Meinetz is very short sighted on this because his political views cloud his judgement.  Much infrastructure investment was alread in progress during the Obama administration to support a massive increase in LNG exports.  The real reason why we should not export LNG is that it is strategically critical that we not allow Europe, and the rest of the world for that matter, to recover from their bad energy policy choices.  Due to their choices and due to the fact that North America is rich in this resource we can once again gain a competitive advantage over most of the world.  Their choices along with the current demographic trends in most of these nations will lead to a huge decline in their economies.  This advantage will allow us the freedom to protect our own borders and allies economically while not having to defend sea lanes to allow other economies to flourish on trade.  These countries will now need to saddle that burden and especially when it comes to shipments of LNG, coal and oil which they will become more dependent on in the next decade or two. 

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