Bloomberg recently reported ongoing trade negotiations may put the U.S. on track to become China’s largest liquefied natural gas supplier. This move could reduce the U.S. trade deficit with China by $17 billion annually. Additionally, this relationship bolsters American foreign policy and energy dominance around the globe – and Louisiana is playing an important role.

“A higher LNG trade from the U.S. to China would potentially be a win-win deal for both,” analysts including Andy Meng wrote. Not only could it reduce the U.S. trade deficit with China by $17 billion annually, it may also help China save $1.8 billion a year in energy costs, the bank estimates.

There may also be major implications for the global LNG market. The U.S. is bringing on new projects and is set to become the No. 1 supplier. All that production needs to find a home, and China is expected to take the title as top importer some time early next decade. Without a deal, it’s likely to turn to other countries including Russia, Australia and the Middle East to fulfill its gas demand, Morgan Stanley said.

The U.S. Energy Information Administration indicated in late May that Sempra Energy shipped its first cargo of LNG from its new facility in Cameron. This is the fourth such facility in the United States to enter service since 2016. The company has regulatory approval to expand the facility even further – increasing the facility’s LNG capacity and continuing to accommodate the nation’s LNG export boom.

The Cameron LNG facility isn’t Louisiana’s only contribution to increased natural gas exports. Australian-based LNG Limited has been seeking permission from federal regulators to boost the production at its proposed Lake Charles facility, Magnolia LNG. Lake Charles is also the location of Energy Transfer’s proposed multi-billion LNG export terminal.

Louisiana’s thriving energy industry is playing a critical role in not only our state’s economy – but also continuing to fuel the American energy boom, fostering economic growth and strengthening the U.S.’ position in the global energy market.

Randy Hayden
President, Louisianans for Energy
Baton Rouge