A proposal to export US natural gas on the global LNG market would hurt domestic customers and jeopardize low prices and energy security, the president of the Industrial Energy Consumers of America said Friday.
"It is not enough to know that the US has significant reserves of natural gas," Paul Cicio said. "The question remains what portion of those reserves can be produced at affordable prices and especially at prices that allow the manufacturing sector to flourish."
Cicio's group lodged the first negative comment to an application by Cheniere Energy Partners to liquefy and export gas from its Sabine Pass LNG terminal in Louisiana. The Houston firm asked the Department of Energy in August for permission to export supplies for 20 years.
"A lot can happen in 20 years, and exporting without any consumer safeguards could increase the price of natural gas and electricity," Cicio said in a December 13 letter to the agency.
Cicio said the requested annual export limit of 803 Tcf represents 3.5% of total US demand in 2009, 13.4% of industrial demand, 17.1% of residential demand and 11.6% of electric sector demand. "An annual average increase in demand of 3.5% could have the effect of pushing prices up for everyone," he said.
"Manufacturing, like most homeowners and farmers, do not have a substitute for natural gas, and we rely upon common-sense energy policy to provide the affordable and reliable natural gas for all of our needs," he said.
Meanwhile, Chesapeake Energy joined Encana this week in asking regulators to approve the export application. Both producers are eyeing the global LNG market as an outlet for North America's vast shale supplies.
James Johnson, Chesapeake's senior vice president of marketing, said the new markets would allow US drillers to keep rigs up and sustain 30,000 to 50,000 production jobs. He estimated exports could improve the US balance of trade by $5 billion to $7 billion.
"The ability to pursue foreign markets to offset weak domestic markets would enable Chesapeake and others to continue investing in the future and to continue employing a highly skilled and motivated workforce," he wrote in a letter he sent DOE that was posted on its website. "This is critical to the future."
Cheniere's application also drew supportive letters this week from members of Louisiana's and Oklahoma's congressional delegations and from Puerto Rican Secretary of State Kenneth McClintock.
In a December 13 letter, McClintock said gas imports from the US would save the country $1.4 billion and help it meet a goal to replace oil-based electricity, which makes up 70% of power generation.
DOE has authorized Sabine Pass export to countries with which the US has Free Trade Agreement pacts, but the agency is still considering Cheniere's request to ship to other nations.
The project depends on construction of a liquefaction plant that must be vetted separately by the Federal Energy Regulatory Commission. That application is in its early stages.
--Meghan Gordon
"It is not enough to know that the US has significant reserves of natural gas," Paul Cicio said. "The question remains what portion of those reserves can be produced at affordable prices and especially at prices that allow the manufacturing sector to flourish."
Cicio's group lodged the first negative comment to an application by Cheniere Energy Partners to liquefy and export gas from its Sabine Pass LNG terminal in Louisiana. The Houston firm asked the Department of Energy in August for permission to export supplies for 20 years.
"A lot can happen in 20 years, and exporting without any consumer safeguards could increase the price of natural gas and electricity," Cicio said in a December 13 letter to the agency.
Cicio said the requested annual export limit of 803 Tcf represents 3.5% of total US demand in 2009, 13.4% of industrial demand, 17.1% of residential demand and 11.6% of electric sector demand. "An annual average increase in demand of 3.5% could have the effect of pushing prices up for everyone," he said.
"Manufacturing, like most homeowners and farmers, do not have a substitute for natural gas, and we rely upon common-sense energy policy to provide the affordable and reliable natural gas for all of our needs," he said.
Meanwhile, Chesapeake Energy joined Encana this week in asking regulators to approve the export application. Both producers are eyeing the global LNG market as an outlet for North America's vast shale supplies.
James Johnson, Chesapeake's senior vice president of marketing, said the new markets would allow US drillers to keep rigs up and sustain 30,000 to 50,000 production jobs. He estimated exports could improve the US balance of trade by $5 billion to $7 billion.
"The ability to pursue foreign markets to offset weak domestic markets would enable Chesapeake and others to continue investing in the future and to continue employing a highly skilled and motivated workforce," he wrote in a letter he sent DOE that was posted on its website. "This is critical to the future."
Cheniere's application also drew supportive letters this week from members of Louisiana's and Oklahoma's congressional delegations and from Puerto Rican Secretary of State Kenneth McClintock.
In a December 13 letter, McClintock said gas imports from the US would save the country $1.4 billion and help it meet a goal to replace oil-based electricity, which makes up 70% of power generation.
DOE has authorized Sabine Pass export to countries with which the US has Free Trade Agreement pacts, but the agency is still considering Cheniere's request to ship to other nations.
The project depends on construction of a liquefaction plant that must be vetted separately by the Federal Energy Regulatory Commission. That application is in its early stages.
--Meghan Gordon
