US Senator Lugar Calls for LNG Exports to NATO Allies

U.S. Sen. Richard G. Lugar, Republican leader of the Senate Foreign Relations Committee, introduced the Liquefied Natural Gas (LNG) for NATO Act, a bill that would reduce U.S. NATO allies’ vulnerability to over-reliance on Russian and Iranian gas supplies.

The bill is a product of a report Lugar also released recently entitled Energy and Security from the Caspian to Europe.

“Lack of diversity in natural gas supplies to NATO allies and friends is a critical concern for United States national security interests. For the first time, vigorous U.S. diplomacy can be coupled with allowing free trade in liquefied natural gas from the United States,” Lugar said. “Now is the time to dramatically shift gas markets to blunt the temptation for political manipulation of supplies by Russia and Iran.”

In the report commissioned by Lugar, SFRC Republican staff members present the strategic rationale for strong diplomacy to diversify natural gas in Eastern Europe via LNG exports to NATO and stronger U.S. engagement on the completion of the next stage of the so-called Southern Corridor, a strategic initiative to link oil and gas supplies from the Caspian basin to Europe. The report argues that, “The United States with our European allies have an unprecedented opportunity to advance broad natural gas diversification. The Southern Corridor is vital for such a strategy in Central and Southeastern Europe and Turkey.”

The LNG for NATO Act introduced today would amend the Natural Gas Act to place NATO allies on the same footing as all free trade partners under an automatic licensing regime for natural gas exports. Recently, the Department of Energy released its own report that found net domestic economic benefits to LNG trade under any scenario.

In addition to passage of the LNG for NATO Act, key recommendations include:

– The United States should restore the dedicated position of U.S. Special Envoy for Eurasian Energy Security. Recently the State Department indicated the position may be subsumed within the new Energy Bureau at the State Department.

– The United States should advocate that Nabucco West be selected as the downstream route of the Southern Corridor, as opposed to dithering between other available options, given that Nabucco West will directly and immediately transport gas to nations in Central and Southeastern Europe who are most vulnerable to Russian energy coercion.

– Congress should re-examine policy toward exemptions from Iran sanctions legislation if new Caspian gas supplies to allies do not bring substantial national security benefits.

As Chairman and Ranking Member of the Senate Foreign Relations Committee, Lugar has played a role in efforts to ensure that energy diplomacy is a central consideration of American foreign policy. In 2006, he authored and led broad bipartisan support for the Energy Diplomacy and Security Act, a bill that led to the creation of the post of International Energy Coordinator and that eventually precipitated a 2011 State Department reorganization to establish a Bureau of Energy Resources. He also has led Congressional Delegations focusing on energy security to Azerbaijan, Brussels, France, Georgia, Germany, Romania, Russia, Kazakhstan, Turkey, Turkmenistan and Ukraine.

In partnership with then-Senator Joseph Biden, Lugar encouraged the Bush Administration to re-establish high-level U.S. engagement on Eurasian energy security, leading to establishment of the Special Envoy for Eurasian Energy Affairs.

In 2006, he delivered a speech at the NATO Summit in Latvia calling for energy security to be incorporated into NATO’s Article Five mutual defense commitment.

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LNG World News Staff, December 17, 2012