Energy trade groups admonish Biden administration’s plan to halt LNG exports

(WO) – The Independent Petroleum Association of America (IPAA) joined the American Petroleum Institute (API), American Exploration and Production Council (AXPC), Center for LNG (CLNG), LNG Allies and dozens of other industry groups from across the liquefied natural gas (LNG) value chain in urging the Biden administration to reject calls to halt permits for U.S. LNG export facilities.

In a letter to Secretary Granholm and senior administration officials, the groups emphasized the critical role that continued U.S. LNG exports play in safeguarding national security, creating U.S. jobs, supporting our European allies and contributing to global climate goals.

“Our nation’s abundant supply of natural gas is an impactful geopolitical tool, helping insulate American consumers from increasing global instability while advancing American national interests and ensuring the energy security of key U.S. allies,” the groups wrote. “Moving forward with a pause on new U.S. LNG export approvals would only bolster Russian influence and undercut President Biden’s own commitment to supply our allies with reliable energy, undermining American credibility and threatening American jobs.”

U.S. LNG was vital in helping Europe avoid the worst of an energy crisis, and Europe has made progress in weaning itself off Russian natural gas. As Eurogas President Didier Holleaux noted in a letter to U.S. officials last week, “It is essential that the United States stands with Europe, especially at a time of war where we are working together to protect our values, and does not deliberately spark a new period of price volatility in Europe caused by policy driven LNG shortages.”

In 2022, the Biden administration pledged to provide Europe with additional U.S. LNG volumes. An analysis of the president’s pledge found that the benefits to the United States could include $63 billion in capital expenditures, a GDP boost of $46 billion, and 71,500 jobs supported annually from 2025-2030. At the same time, any action to slow the approval of U.S. LNG exports would jeopardize global efforts to reduce greenhouse gas (GHG) emissions. The U.S. is the world leader in CO2 emissions reductions – largely thanks to coal-to-natural gas fuel switching in the power sector – and nations currently reliant on coal have an opportunity to replicate this success. Fuel switching from coal to natural gas is responsible for more than 60% of CO2 emissions reductions in the U.S. power sector since 2005.

“Nearly eight years of operating experience and DOE’s own studies have demonstrated that LNG exports are squarely within the public interest,” the groups wrote. “Throttling down U.S. LNG exports will eliminate an important tool in reducing global emissions and force quickly developing nations – specifically in Asia—to abandon plans to reduce emissions and increase coal consumption.”

The administration has already extended a permitting process for LNG permits that took seven weeks during the last administration to an 11-month process on average. Any additional changes to LNG export permit approvals would be an unnecessary addition to an already burdensome bureaucratic process.

“Our industry is proud to support our allies and global emissions goals, but the geopolitical and climate benefits of American energy exports cannot be maintained with a regulatory regime that moves at the whims of political pressure,” the groups concluded “We urge you to reject calls for DOE to prolong the review period or create new hurdles as it considers approvals for new LNG projects and terminals.”