Sen. Murkowski Urges Timely Permitting of LNG Exports

May 21, 2013

WASHINGTON, D.C. – U.S. Sen. Lisa Murkowski, R-Alaska, today spoke about the importance of timely review of export licenses and the need for regulatory certainty at a forum on natural gas supply and export opportunities convened by the Senate Energy and Natural Resources Committee.

LAMNatGasRoundtable

(Click for video)

“Is there agreement that the window for U.S. export is limited?” Murkowski asked the group of industry, academic and government experts. Witnesses agreed the window was certainly “narrowing” and highlighted the geopolitical benefits of exporting natural gas.

After a 29-month review process, the Department of Energy issued its second license Friday to Freeport LNG, conditionally authorizing it to export liquefied natural gas (LNG) to nations with which the United States does not have a free trade agreement.

Murkowski said the length of the DOE review process could result in the United States missing a historic opportunity to join a burgeoning global gas trade. Countries like Australia, Papua New Guinea and Canada are already moving forward on LNG export projects.

She also strongly questioned DOE’s ability to revoke licenses under unspecified situations, which has raised concerns among major international players in the global gas market. DOE Assistant Secretary Chris Smith clarified in response to her questions that the department would respect “the sanctity of contract” and would not use the ability as a “price-maintenance mechanism.”

“The vast majority of independent analyses conducted over the past year have found that exports overwhelmingly benefit the economy. And, ultimately, market forces will serve to limit the number of export facilities that actually get built,” Murkowski said. “We simply cannot afford to needlessly drag our feet on exports or we’re going to let real economic development opportunities, and the chance to provide our allies access to an abundant, affordable and clean source of energy, slip through our fingers.”

Estimates of U.S. natural gas supplies and production continue to increase. According to the EIA, U.S. proven natural gas reserves in 2010 rose by the highest amount since the agency started publishing the data in 1977. EIA’s 2013 Annual Energy Outlook reference case forecasts a 44-percent increase in natural gas production over the next 30 years, mostly due to shale gas production.

Various reports and studies continue to show – and EIA projects – surpluses in domestic natural gas supplies – above and beyond what we need at home – available for export. This is not new. We’ve been exporting natural gas to Mexico by pipeline for decades – and at record levels in 2012.

“It’s my hope that last week’s decision on Freeport is the first of many projects that will be approved in the coming weeks and months – not years,” Murkowski said. “The decision clearly shows that DOE’s review process is deliberative, impartial and thorough – though greater certainty should be provided so we can press our advantage in world markets.”

Full video of the forum on natural gas supply and export opportunities can be viewed at the Senate Energy and Natural Resources Committee website.

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