CLNG challenges petition seeking ban on LNG exports

The Center for Biological Diversity and a number of other groups recently filed a petition with the U.S. Department of Commerce seeking an immediate ban on natural gas exports.

Center for Liquefied Natural Gas claims that in the petition these groups presented unfounded legal, environmental, and economic arguments that misrepresent U.S. LNG exports.

“Exporting this fuel not only brings significant economic benefits to the U.S., but other nations welcome the climate and air quality benefits that  burning natural gas provides when compared to more carbon-intensive fuel sources, such as coal,” CLNG said in a statement refuting several claims made by the groups.

The petitioners claimed that the export of LNG is illegal noting, “The U.S. Energy and Policy Conservation Act was passed by Congress in 1975 to conserve domestic energy supplies, specifically natural gas and crude oil, by prohibiting the export of both unless specifically covered by an allowable exemption. Although the Department of Commerce has instituted such a ban on crude oil, it has failed to address natural gas exports despite an exponential increase in such exports over the past decade.”

However, CLNG stresses that this law has not applied to the export of natural gas for quite some time. Decades of new laws and regulation have superseded the legislation, which was passed during a time of scarcity and supply shocks. Furthermore, some critics suggest that LNG has an unregulated, unfettered export process. In fact, there is a robust regulatory regime in place that includes an extensive environmental review as required by the National Environmental Policy Act. Both the Federal Energy Regulatory Commission and the Department of Energy must approve each export facility, and each review provides multiple opportunities for stakeholder input while also requiring compliance with other laws like the Clean Air Act and Clean Water Act. The process as it stands now takes more than a year to complete.

Groups also claimed that most natural gas exports from the United States are in the form of liquefied natural gas, which is usually easier to transport but entails its own hazards and requires significant energy use. Since the late 1990s, natural gas exports have increased by roughly 1,000 percent, from 163,415 million cubic feet in 1999 to the most recent high of 1,618,828 million cubic feet in 2012.

CLNG challenges this claim saying that, according to the Energy Information Administration, LNG exports make up only about one percent of total U.S. natural gas exports. The overwhelming majority of gas exports leave the country through pipelines to Canada and Mexico, two critical North American energy partners.

“With scientists demanding that we keep fossil fuels in the ground to avert climate disaster, fracking more natural gas puts corporate profits above the American people,” said Ben Schreiber, climate and energy program director at Friends of the Earth. “The Obama administration needs to comply with the law and not export a fuel that has higher carbon emissions than coal.”

Center for Liquefied Natural Gas refuted this claim by pointing to a wide range of studies that show the clear climate benefits of natural gas-fueled power generation. It is the cleanest burning fossil fuel and emits about half the carbon output of coal burned for power generation. Furthermore, burning natural gas improves local air quality because it emits dramatically less amounts of compounds linked to smog, acid rain and asthma. “Natural gas is a cornerstone of the Obama administration’s carbon reduction efforts at home, and as the Department of Energy concluded in a recent report, LNG can similarly play a key role in reducing global climate emissions,” CLNG said.

Also, a recent study by the Bipartisan Policy Center determined that “Restricting international trade in fossil fuels is not an effective policy to reduce global greenhouse gas emission or to advance domestic economic interests, and we recommend against any such restrictions.”

With the growth of developing economies around the world, the U.S. has a unique opportunity to export LNG and provide clean-burning energy to meet rapidly increasing energy demands, while also reducing greenhouse gas emissions, CLNG concluded.

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Image: Cheniere