President Biden’s recent freeze on U.S. Department of Energy permits for new liquefied natural gas projects has weakened the United States’ national security.
That’s according to the Texas Independent Producers & Royalty Owners Association and Waco economist Ray Perryman, who say Biden’s decision has also brought American reliability into question.
“Across the world U.S. oil and natural gas is in high demand,” TIPRO President Ed Longanecker said from Austin. “Our local producers provide the most efficient, affordable energy sources and it’s up to us to support our allies in need.
“Limiting our ability to deliver critical resources not only hinders our national security but also sends a negative message that the United States is an unreliable business and trading partner,” he said. “Whether the jurisdiction of exports is under DOE or the Federal Energy Regulatory Commission, the industry will maintain its commitment to meet energy demands and provide a secure energy future for all.”
Congressman August Pfluger last Thursday won passage in the House of Representatives in Washington of his Unlocking Our Domestic LNG Potential Act of 2024, which was sent to the Senate, to abrogate Biden’s decision and transfer permitting authority to the FERC.
Pfluger’s bill would also reverse Biden’s prohibition of LNG exports to nations with which America does not have Free Trade Agreements.
Perryman said the pause on permitting “is harmful not only to the energy industry but also to energy security, geopolitical stability and ultimately climate initiatives.
“Russian media is actually celebrating the U.S. decision and the shortsighted move is clearly helping Russia to maintain its economic stability and political influence,” Perryman said. “The United States has recently become the leading exporter of LNG and the market has been expanding significantly in both Europe and Asia.
“When Russia invaded Ukraine the dangerous dependency of Europe on Russian natural gas became abundantly obvious as some of us had been talking about for decades. One of the projects affected by the permit pause is already committed to supply natural gas to Germany.
“American allies in Europe and elsewhere are investing billions in needed infrastructure to allow them to regassify LNG from a source they had assumed was reliable and the U.S. pause is causing deep concerns.”
Perryman said Biden’s move also enhances the investment risk exposure associated with the development of domestic LNG facilities.
“Although climate change is a critical issue which must be dealt with, many well-meaning activists have failed to recognize that every credible analysis including those of the Department of Energy shows that even as other forms of energy rapidly expand their footprints, the world will require more oil and natural gas in 2050 than it does today,” he said.
Perryman said the irony in the moratorium is that the expedited development of LNG facilities is beneficial to climate efforts in that much of the expanded exports would facilitate replacing coal or higher carbon natural gas from other areas for power generation facilities.
“Without a doubt politics should be taken out of a decision to pause and Congressman Pfluger’s bill to place authority with FERC is a positive step,” he said. “Our firm has performed the economic analysis for many of the currently permitted plants throughout the U.S. and FERC has consistently evaluated applications on the merits including impacts on the U.S. economy under multiple administrations.
“Any President can be swayed at times by influencers, donors and polls, but an agency such as FERC is less likely to get caught up in political considerations related to LNG and focus more on responsible energy development.”
