Industry Pushes Back on LNG Export Pause

API argues that even at record-high U.S. LNG exports, domestic residential natural gas prices fell in 2023 and are among the lowest in the world. That’s because the industry has the ability to meet rising global demand for natural gas while maintaining a well-supplied domestic market, it added.

Related: Barclays Downgrades Energy Services Sector Amid Bearish Outlook

Moreover, higher LNG exports drive economic growth in the U.S. and reduce America’s trade deficit—key points for incoming President Trump.

The U.S. LNG industry has contributed more than $400 billion to GDP over the past decade, supports about 275,000 jobs, and represents roughly $34 billion in exports, a new study from S&P Global cited by API showed.

U.S. LNG has also played an important role in keeping Europe supplied with natural gas after Russia cut off most of its pipeline gas deliveries to the EU following the Russian invasion of Ukraine.

Finally, coal-to-gas switching is the main reason that the U.S. has led the world in reducing CO2 emissions over the past two decades, API said, citing a recent study by Berkeley Research Group.

U.S. Chamber of Commerce Senior Vice President of Policy, Marty Durbin, also called for an immediate end to the LNG permit pause.

“From the beginning, the White House moratorium on new LNG export facilities was a politically-driven exercise with harmful impacts on the U.S. economy and the energy security of America’s allies. It should end immediately,” Durbin said, commenting on the DOE study.

“We will thoroughly review the DOE report, but it appears to rely on questionable methodology and puts a thumb on the scale to downplay the clear economic, environmental and security benefits of U.S. LNG,” added Durbin.

President Trump and LNG

The renewed debate on LNG permitting comes a month before President-elect Donald Trump returns to the White House and enacts – most likely – sweeping changes to U.S. energy policy, including expediting LNG export permits. Boosting U.S. oil and gas drilling and accelerating permits for domestic energy infrastructure and LNG exports are expected to be top priorities for the new administration.

In a sign of what the energy industry can expect, Trump last month picked a shale boss, Chris Wright, chief executive of Liberty Energy, as his nomination to lead the Department of Energy. Wright is a vocal critic of the energy transition as envisaged by most Western governments to date, instead calling for energy realism and prioritizing the supply security and affordability of energy rather than its emission footprint.

As the industry calls for faster approvals of energy infrastructure, including LNG export plants, the U.S. remains the world’s largest LNG exporter, ahead of Qatar and Australia.

America’s LNG exports are set to rise slightly this year but still beat the previous annual export record from 2023.

But next year, U.S. LNG exports are expected to jump by 15% over 2024, reaching almost 14 Bcf/d, thanks to higher export capacity with the Plaquemines LNG and Corpus Christi LNG Stage 3 plants, the EIA said in the latest Short-Term Energy Outlook (STEO) for December. 

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com

• Forget Short-Term Noise: Oil Prices Are All About the Long-Term Trend
• Hurricane Fury in 2024 Slows US Gulf Energy Production
• Germany To Shut Down Key LNG Terminal In 2025