Congress Hears from Experts about Barriers Preventing Growth of American Energy Exports

With U.S. natural gas production soaring and a majority of voters expressing support for new oil and gas development, many stakeholders have called for Congress and the Obama Administration to allow more substantial exports of liquefied natural gas (LNG) to nations with which the United States does not have a free trade agreement (non-FTA countries).

The Energy and Power Subcommittee of the U.S. House of Representatives recently held a hearing to solicit information on the various barriers that are preventing the growth of American energy exports. Expert witnesses from numerous fields testified about both the obstacles that exist in the market and the regulatory and legal hurdles facing potential exports.

Research foundation chief: Concerns about LNG exports are ‘misplaced’

There has been speculation that the U.S. Department of Energy will use its review process to restrict exports of LNG to non-FTA countries. Lucian Pugliaresi, president of the Washington-based Energy Policy Research Foundation, told members of the subcommittee that he believes this would be “both unnecessary and counterproductive,” particularly if those actions were driven by the fear that exports would put pressure on domestic supplies.

“Concerns by some U.S. manufacturers that U.S. exports of LNG should be constrained to save gas for domestic manufacturing are misplaced,” Pugliaresi explained. “Even the most ambitious plans to use gas for the entire range of domestic applications are highly unlikely to limit the availability of U.S. gas supplies for export markets. The domestic market will remain well supplied across a wide range of scenarios.”

Other experts highlighted the importance of ongoing technological advances. Andrew Slaughter, vice-president of oil and gas research at IHS, urged lawmakers to realize that although U.S. production had expanded rapidly in recent years, meeting demand in the future would require an ongoing commitment to exploring unconventional reserves, which could necessitate the development of new production technologies.

“We can’t let ourselves be carried away by all the hype,” Slaughter said.

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