An editorial from The Wall Street Journal is blaming environmentalists for slowing down a controversial process to export natural gas, overlooking the fact that members of the gas industry have condemned the procedure.
The Wall Street Journal Editorial Board has been calling for the the U.S. to export more natural gas, which would need to be condensed, liquefied, and shipped out of specialized liquefied natural gas (LNG) terminals. On March 24, the seventh LNG export facility, to be constructed in Oregon's Jordan Cove, was approved by the Department of Energy (DOE), a move widely criticized by environmental groups. The Wall Street Journal Editorial Board dismissed the approval as well, but only because these export terminals aren't coming fast enough, with 24 projects still waiting for approval. The Board blamed “President Obama's green donors” for the “slow-roll process.”
But members of the natural gas industry are critical of the controversial export terminals. America's Energy Advantage (AEA), a trade coalition of businesses and organizations that support the natural gas industry, released a statement denouncing the approval of the new export terminal. The group, which includes Dow Chemical and Alcoa Inc., wrote that the DOE's approval of the Jordan Cove facility is “a grievous error” that will “harm U.S. consumers and economy.” From the AEA statement:
This is a grievous error that puts billions of dollars of investment and millions of jobs at risk. Stable and affordable natural gas is powering an American manufacturing comeback. According to IHS Chemical, more than $125 billion of new manufacturing investments are planned. This latest export approval will raise domestic natural gas, electricity, home-heating and propane prices for every American, undermine our manufacturing competiveness and cost the nation good-paying jobs. America's Energy Advantage renews its call for the Administration to take an immediate 'time out' from further LNG export approvals until a new, comprehensive review of current market conditions is completed."
Other studies and energy experts have warned of the economic dangers that may result from approving too many LNG export terminals, pointing out that it could lead to immense oversupply. As reported by Bloomberg, a Rice University analysis found that with “plans for dozens of the multibillion-dollar export terminals in North America alone, the industry is headed toward an overbuild that may depress Asian prices for a decade.”
Sen. Ed Markey (D-MA) cited a 2012 study from the DOE itself, saying it found that a “high export scenario” of LNG could increase domestic gas prices by more than 50 percent. According to Markey, approval of the Jordan Cove facility would cause the nation's LNG exports to cross the threshold for that very scenario. Energy analyst Chris Nelder wrote in an email to Media Matters that export terminals might not even be able to fulfill their contracts if natural gas prices don't remain as low as they are today.