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The Case for Natural Gas Exports

Author: Michael A. Levi, David M. Rubenstein Senior Fellow for Energy and the Environment and Director of the Maurice R. Greenberg Center for Geoeconomic Studies
August 15, 2012
New York Times


NEW data released last month signaled a milestone for American energy: natural gas joined coal as the top source of electric power. Gas production has boomed on the back of abundant supplies. That has spurred debates over hydraulic fracturing, a method to extract gas from shale.

A related political and economic debate has emerged. A string of companies have applied for permission to export liquefied natural gas, or L.N.G., to countries that don't have special free-trade agreements with the United States. Under federal law, the Energy Department has to find such exports to be consistent with the "national interest" before they can occur, though the term isn't clearly defined.

Last week, more than 40 members of Congress urged President Obama to move forward with approval, citing the benefits of free trade and the prospect of creating more jobs as demand for exports leads to growth in gas production.

Critics pose a contrary set of arguments. They fear that demand for gas exports might encourage hydraulic fracturing, threatening water supplies, and they worry that siphoning off domestic gas for export will raise costs for domestic consumers and disadvantage American manufacturers that benefit from low-cost fuel.

There are also national security concerns. Some see an opportunity to frustrate the two biggest holders of natural gas reserves: Russia and Iran. Critics would prefer that natural gas be used to replace oil in American automobiles.

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