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The US Center for LNG has urged (CLNG) Energy Secretary Jennifer Granholm to maintain her hands-off approach to exports as US gas prices rise. The lobby group advocates for public policies that advance the use of liquefied natural gas (LNG) and its export.

US front-month gas had been trading at about $3/mn Btu at the liquid Henry Hub for some years but had risen substantially, reaching $5/mn Btu over the summer. But this rise still leaves a very big margin for liquefaction and shipping to overseas markets. On September 23, the front-month Henry Hub was about $21/mn Btu cheaper than the Asian LNG benchmark, the Japan-Korea Marker.

As industrial gas users call for a slow-down in exports, CLNG’s September 24 letter said: “US LNG exports are a present-day example of the vision that the Biden Administration’s ‘Building Back Better’ is working to achieve. We support domestic jobs and new infrastructure investment while providing America’s valued overseas allies with lower-emitting energy. We also want what consumers want, which is a well-supplied, stable and affordable natural gas market, here and abroad.”

Halting LNG permits and the multi-year permitting, approval, and construction processes associated with US.  LNG would fundamentally undermine this certainty, impacting not only domestic and global markets for years to come, but also frustrating the investment-backed expectations in the industry globally. “Hyperbole and fear have no place in energy policy discussions,” it said.

Rejecting the industrial users’ claims that exports were the sole reason for rising gas prices, it said instead that tehy resulted from inadequate reserves in storage; the very high temperatures; bad weather; and a lack of hydro in the western states. And “most telling,” those advocating a cap on exports “are choosing to ignore the fact that the publicly-available Nymex strip for natural gas points to drop-offs in April,” it said.

The US Energy Information Administration points to lower prices throughout 2022, as US natural gas production increases. “This is a classic example of supply and demand leveling the playing field without government intervention,” it said.

Higher production, partly in order to meet LNG export demand, leads to new investments that benefit local communities, tax revenues and jobs, also funding national efforts to reduce emissions as countries try to reduce their use of coal, it said. “Globally, these same exports enable partner nations to better meet Paris Accord targets in an international effort to reach net-zero emissions, promoting natural gas in lieu of energy sources with much higher emissions.”

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For More Enquiry: 08052442020


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