PA Environment Digest Blog: US Senators Introduce Bill To Ban US LNG Gas Sales To Any Entity Under The Control Of Communist China To Protect US Jobs; Americans From Price Spikes; EQT Says We Have A ‘Duty’ To Provide LNG Gas To China; Where Do AMERICAN Interests Lie?

On February 28, Ohio US Senator Sherrod Brown and Oregon US Senator Jeff Merkley introduced the Protecting American Households from Rising Energy Costs Act, legislation that would ban the export of crude oil or liquefied natural gas (LNG) to our biggest adversaries: China, Russia, Iran, and North Korea.

“It’s time to stop raising prices for Americans by sending LNG to our adversaries,” said US Senator Merkley. “I’m partnering with Senator Brown to fight to lower energy prices for working Americans.”

“We should not allow American liquid natural gas to fuel China’s state-sponsored industries. The Chinese Communist Party uses that energy to cheat and undermine Ohio production and Ohio jobs,” said US Senator Brown. “Blocking China and other adversaries from obtaining our LNG will protect our national security, and keep more of this energy in America, helping bring down prices for Ohioans.”

In addition to Merkley and Brown, this legislation is sponsored by Senators Angus King (I-VT) and Jack Reed (D-RI).

Since 2018, U.S. LNG exports have more than tripled to 14 billion cubic feet per day, making the United States the largest exporter of LNG in global history.

Further, exports could rise another 48 billion cubic feet per day, almost three times more than today’s large volumes, when projects that are either under construction or fully permitted come online.

In 2021, 1.2 billion cubic feet per day of LNG were exported to China, making it the second largest destination for U.S. LNG at 12.7 percent of exports.

Exports to China dropped in the wake of Russia’s war on Ukraine, but China is locking up long-term LNG contracts from the U.S. for proposed projects.

Exporting LNG is causing price instability and rising costs for American households and industries, the Senators said..

A report by Energy Innovation found that approving pending LNG export terminals would increase natural gas costs for American households, businesses, and industry by 9 to 14% each year. [Read more here]

The Protecting American Households from Rising Energy Costs Act would increase American energy security and protect American consumers by ensuring that valuable natural resources are not being exported to adversarial nations—helping to keep domestic prices stable and affordable for American households and businesses, while not locking us in to decades of fossil gas infrastructure that exacerbates climate chaos.

Click Here for a copy of the bill. Click Here for a summary.

EQT Said We Have ‘Duty’ To Supply Gas To China

In November, Pittsburgh-based EQT Corporation, the largest producer of natural gas in the US, relaunched its "Unleash” LNG Exports initiative that argued the US "has a duty to provide” natural gas to countries like China because they don't have natural gas of their own. Read more here.

CEO Toby Rice argued China needs US natural gas to reduce its dependency on the use of coal to generate electricity and reduce power plant emissions.

EQT noted "China's current energy mix mirrors that of Pennsylvania and Ohio in 2005" saying with US-supplied natural gas, China could replicate the model for emissions reduction.

EQT said "The only solution" to climate change is "unleashing US LNG" for China.

Click Here for a copy of EQT’s presentation.

EQT is advancing its Unleash LNG strategy by signing agreements to export its gas-- Lake Charles, Commonwealth LNG and other facilities.

About 25% of the natural gas produced in Pennsylvania is used in Pennsylvania. The other 75% is used outside the state. Read more here.

View From China

China needs natural gas to help meet power demands and for industrial chemicals and fertilizer and for continued economic growth. Read more here.

Not only EQT, but Shell and other companies see LNG gas demand growing significantly by 2040 as the Chinese industrial sector pivots from coal to gas. Read more here.

Shell’s CEO said “China is likely to dominate LNG demand growth this decade as its industry seeks to cut carbon emissions by switching from coal to gas.” Read more here.

Reuters has reported US LNG gas supplies give China the “muscle” to become a major force in global gas trading for gas, even for gas they don’t end up using. Read more here.

China is the world leader in producing electricity from renewable energy sources and a major exporter of solar and wind energy technology. [Read more here.]

It also has a growing natural gas industry of its own. Read more here.

China has the world’s second biggest economy and would like to continue its growth with a recently announced 5% growth target and LNG would be part of that success. Read more here.

Where do the economic and environmental interests of the US lie?

Resource Links:

-- PA Utility Law Project March 15 Webinar On Impacts Of LNG Gas Exports On Energy Costs For Pennsylvania Families; LNG Export Capacity To Double, Even With Permit Pause [PaEN]

-- US Energy Information Agency: US LNG Gas Exports To China

NewsClips - LNG:

-- Bloomberg: Natural Gas Prices Jump As EQT Slashes Output To Fight Glut

-- Reuters: Pittsburgh-based EQT To Reduce Gas Production Through March On Low Prices

-- Reuters: China Increases Imports Of LNG Gas During First 2 Months Of 2024

-- Reuters: China Starts New Year With Robust Imports Of LNG Gas

-- Reuters: Top LNG Importer China Re-Selling More Cargoes, Eyes Trading Gains

-- Reuters: Major European Energy Companies Ask US Regulators To Deny Permit Extension For Louisiana LNG Gas Export Plant

-- Bloomberg: Aramco In Talks For US LNG Gas Projects, Looks For Investment Opportunities In China

-- Reuters: Aramco Sees China Oil, LNG Gas Demand Growing, Eyes More Investments

-- Reuters: European Union Receives Bids For Nearly 3 Times The Volume Of Gas They Need

-- PA Independent Oil & Gas Association: An Increase In LNG Gas Exports Is Expected To Increase Seasonal Price Volatility In The Future

-- Financial Times: Household Energy Costs Factor Into Biden’s Pause On New LNG Natural Gas Export Facilities [Industrial Energy Consumers: “More Exports Equal More Reliability And Price Risk”]

-- Reuters: Chesapeake Energy Says Gas Market Oversupplied, Plans To Cut Output, Spending

-- S&P Global: US Gas Producers Tout LNG Growth Outlook Despite Regulatory Uncertainty; [EQT - ‘There’s Really No Impact [from new facility permit pause] through at least the end of 2026’]

-- Reuters: European Union Says Biden’s Pause On Approvals Of New LNG Natural Gas Export Facilities Will Have No Effect On US LNG Supplies To Europe Over Next 2 or 3 Years [LNG Exports Are Expected To Double By 2030 On Already-Approved Projects]

-- Post-Gazette - Anya Litvak: A Political Battle Brews Over Natural Gas Exports Over Impacts To Gas Prices, Climate, Demand For Gas

-- Natural Gas Intelligence: 76% Increase In LNG Natural Gas Export Capacity Already Under Construction; US Group Fears Buildout Will Hurt American Businesses Urge ‘US Consumers First’ Policy [PaEN]

-- Bloomberg TV: Canada’s Energy Minister: Period Of Using Natural Gas As Transition Fuel Should Be Short; Gas Should Not Replace Renewables; Canada Has Adopted Controls On LNG Exports The US Has Not [PaEN]

-- Bloomberg: European Natural Gas Prices At Pre-Crisis Levels Seen Spurring Asian Demand

-- Reuters: Slumping US Natural Gas Prices Cause Hedge Funds To Despair