IECA: further US LNG export approvals not in ‘public interest’

Industrial Energy Consumers of America claim the Department of Energy’s approval of LNG exports from the United States are not in the public interests. 

In its letter to the U.S. energy secretary, Rick Perry, U.S. trade representative Robert Lighthizer, and the commerce secretary Wilbur Ross, IECA said that the DOE’s “approval of LNG export volumes equal to almost 70 percent of 2016 U.S. demand for periods of 20 to 30 years, cannot possibly be in the public

The IECA goes on to question the legality of further LNG export approvals, claiming these pose a threat to domestic manufacturing, manufacturing jobs and the economy long-term.

“We urge a measured approach and metrics to determine public interest which will guide informed short and long-term decision making, and the establishment of prudent consumer safeguards,” the letter reads.

While the United States has large natural gas resources, these are not large relative to the domestic consumption, the association said, adding that the country has the smallest natural gas resources relative to domestic consumption of any LNG exporter.

IECA created a report based on the Energy Information Administration’s (EIA) Annual Energy Outlook AEO for 2018 natural gas demand and illustrates that the USA are on track to consume 69 percent of all natural gas resources by 2050 in the lower 48.

The Potential Gas Committee report indicates that 58 percent of all natural gas resources are highly uncertain and are classified as ‘possible resources’ or ‘speculative resources.’

EIA states that only 17 percent of all resources are proven. Eighty-three percent of all resources are classified as ‘technically recoverable,’ which does not mean that they are ‘economically’ recoverable.

The association puts focus on LNG exports to non-FTA countries which consumed 52.7 percent of the chilled fuel shipped from the United States from February 2016 through December 2017. In total, 47.4 percent of the volumes went to China, Japan and India with which the United States have a manufacturing sector deficit.

IECA urged recalculation in terms of supporting the national security and US allies as the DOE approved exports currently are sufficient to supply nearly all of the EU’s import capacity, however, out of the 270 cargoes shipped in the January 2016-December 2017 period only 26 cargoes or 9.6 percent landed in the EU, which can’t justify the basis of national security, the association said urging a halt on new LNG export approvals.