Washington, D.C. – Senator Ron Wyden’s office issued the following statement Wednesday in response to an Energy Department-commissioned study on the effect of exporting liquefied natural gas:
Senator Wyden received this study this afternoon and plans to examine it closely before weighing in on the details. Broadly speaking, the study appears to confirm that exports of LNG will raise the domestic price of natural gas. Senator Wyden is insisting that impacts such as these guide the export policy that the Obama Administration is developing with respect to natural gas and energy more broadly.
Regardless of this study’s conclusions, Senator Wyden will continue to call on the Energy Department to ensure that unfettered natural gas exports don't harm U.S. consumers and manufacturers. Forecasts and scenarios are worthwhile, but the department has an obligation to consider the impacts of each of the actual applications before it. It is critical that exports do not squeeze out or price out the billions of dollars of new, natural gas-related investments that have been proposed in the U.S. chemical, industrial, and electric generation sectors.
DOE has already approved LNG exports that equal nearly one-third of the U.S. daily natural gas consumption, and has a similar volume of applications pending. The agency has an obligation to consider the potential impact of this massive volume of exports.
Background: DOE has approved 27.4 billion cubic feet per day (Bcf/d) in LNG exports to countries that share free trade agreements with the U.S., with another 1.25 Bcf/d pending. It has approved 2.2 Bcf/d in exports to countries without free trade agreements, and has 21.5 Bcf/d in applications to non-FTA countries pending. According to the latest Energy Information Administration report, from July, US natural gas consumption was 66.8 Bcf/d in 2011. Dow Chemical, which has been tracking proposed U.S. expansions in the chemical and industrial sector, estimates that about $80 billion of new investment linked to natural gas has been proposed. These projects would consume roughly 6 Bcf/d. Dow estimates that potential growth U.S. industrial demand will ultimately add 11 Bcf/d.