Time To Pick Up Pace On LNG Applications

By March 24, 2014Economy, Energy

This morning the Department of Energy (DOE) authorized the seventh export terminal, Jordan Cove Energy Project, L.P., to export domestically produced liquefied natural gas (LNG) to non-Free Trade Agreement (FTA) countries. Manufacturers are pleased with the approval of the Jordan Cove project but still believe these decisions should be coming much more quickly.

The law requires the Department of Energy to make an up-or-down national interest determination for each project on a case-by-case basis. Each project deserves the fairness of an up-or-down decision in a prompt fashion. In December 2013 the NAM released a report by James Bacchus, the former World Trade Organization (WTO) Appellate Body Chairman. Bacchus concluded in this report that the implementations of U.S. rules in ways that unnecessarily impede exports of LNG likely violate WTO trade rules.

This week the House and Senate Committees will hold hearings on the subject of LNG exports.  The House Energy and Commerce has asked Mr. Bacchus to testify on this topic along with other experts. The Senate Energy and Natural Resources Committee will hold a hearing that will include the Administrator of the U.S. Energy Information Administration, Adam Sieminski, the Minister of Energy of the Republic of Lithuania and a number of other energy experts.

The pressure will only increase on the Administration if these approvals continue to trickle out every six to eight weeks.  World events continue to demonstrate the demand for natural gas and illustrate the need for the U.S. to speed up their process and not run afoul of the WTO rules. In a Bloomberg interview Secretary Moniz recently acknowledged that perhaps the LNG approval process should take into account world events when he said, “maybe we will give some additional weight to the geopolitical criterion going forward.”  The U.S. doesn’t exist in a vacuum and we must pay attention to what is happening in the world around us. In this case we are getting strong signals from our allies that they are looking for our help. It’s time to get our heads in the game.

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