Higgins, Cassidy Tout Bill To Expedite Natural Gas Export Permits

Rep. Clay Higgins and Sen. Bill Cassidy have introduced a bill in both houses of Congress to get America into the natural gas export game, a piece of legislation lots of Louisianans sitting on idle gas wells in places like the Haynesville Shale will be happy to see turned into law.

Domestic natural gas prices linger in lousy shape. The June spot price for natural gas at the Henry Hub was a miniscule $2.98 per million BTU, and it hasn’t been above $3.59 since 2014. There is simply too much natural gas available in the domestic market to lift that price, and if gas isn’t above $5.00 or so, lots of those wells don’t produce – the economics dictate leaving that gas in the ground until prices rise, which makes sense for the Chesapeakes and Devons of the world but maybe not so much for the Boudreauxs and Thibodeauxs who’d like to get some royalties out of those wells.

The only way to lift that price is to find new markets for natural gas. And once you get away from the United States natural gas prices are a good bit higher. The June European spot price for natural gas was $5.41. The Japanese spot price for June was $8.50. In China the number was $4.92 in February, which was the latest figure we could find. The point being there are more lucrative markets if the gas can be exported to them.

So here’s a press release about how Higgins and Cassidy are working to resolve that imbalance…

Congressman Clay Higgins (R-LA) has introduced H.R. 3367, to remove barriers placed on U.S. exporters so they can quickly access the market and meet the global demand of natural gas. Senator Bill Cassidy, M.D. (R-LA) is sponsoring the License Natural Gas Now Act, which is the Senate version of the bill.

The LNG Now Act would revamp the current system created by the Department of Energy (DOE), guaranteeing acceptance of export volume applications and establishing market growth of U.S. exports without burdensome delays. Currently, dated restrictions have stalled new project development and logjammed export volume applications processing at DOE.

“The United States is on the cusp of becoming a net exporter for the first time in history, and natural gas is leading the way,” said Rep. Higgins. “Southwest Louisiana is the epicenter of this energy revolution. Our legislation rolls back red tape and unleashes America’s energy potential for the first time in nearly a decade, which means jobs and economic growth for our communities. I’m very glad to be working with Senator Cassidy on this critical endeavor.”

“The previous administration created hurdles that stalled LNG projects that benefit the economy, environment and Louisiana workers,” said Dr. Cassidy. “This legislation adds certainty to the approval process and brings investment and better-paying jobs to Louisiana.”

The United States has been exporting natural gas for nearly 100 years, but only recently has the idea of becoming a net exporter seemed plausible.

The U.S. Energy Information Administration (EIA) estimates there are 2,474 trillion cubic feet of technically recoverable natural gas in the United States. With the growth of the U.S. LNG market, the United States has the opportunity to fill the expected 4-5% annual LNG global demand growth in coming years.

The bill preserves the Federal Energy Regulatory Commission LNG Export facility process and the Administration’s ability to limit net trade during national emergencies or as sanctions against nations unfriendly to the United States.

It’s difficult to see how this bill wouldn’t pass. Democrats really can’t afford to be seen as blocking natural gas exports, considering that to do so will likely kill their party electorally in places like Ohio and Pennsylvania where shale gas is probably the best economic story going, and there isn’t even a good environmental story to tell about stopping the spread of gas exports. After all, the Europeans, let’s say, are using natural gas produced in Russia according to lower environmental standards than we have here, and we know that natural gas burns cleaner than coal which is fueling China’s economy. Exporting gas to the Chinese to displace coal probably does more to reduce carbon emissions, which the environmentalist crowd so loves to worry about, than anything else anyone could do.

It’s a good bill. Louisiana’s economy could definitely use the help, particularly in places like the northwestern part of the state where the slack-off in Haynesville Shale activity has hurt. And American natural gas exports could be a big piece of the puzzle in changing the geopolitical game with the Russians and Chinese.

Let’s hope this passes.

Interested in more news from Louisiana? We've got you covered! See More Louisiana News
Previous Article
Next Article

Comments


Trending on The Hayride