Furthering the Case for U.S. LNG: Security, Consumers and the Environment

Megan Bloomgren
Posted February 1, 2024

Five quick points rebutting a recent Washington Post op-ed, authored by a pair of anti-natural gas activists, urging the Biden administration to freeze approvals for U.S. liquefied natural gas (LNG) to supply allies – which, unfortunately, it did last week.

1. Playing Politics with Energy – The administration’s move is “an election-year sop to climate activists that will do much more to unsettle vital U.S. alliances than to save the planet.”

2. U.S. LNG Strengthens Allies’ Security – “Unfortunately for the world, Russia produces much of this vital resource, as Europe discovered to its dismay when President Vladimir Putin invaded Ukraine — with an army that had been funded by earnings from Russian gas exports. Fortunately for the world, the United States has emerged as the top exporter of the supercooled form known as liquefied natural gas, or LNG.”

3. Russia Wins – “You cannot change demand for energy by destroying supply: If the United States did indeed curtail LNG exports, it would just drive customers into the arms of competitors such as Australia, Qatar, Algeria and, yes, Russia.”

4. Damage to America’s Credibility – The administration’s political gamesmanship over LNG raises questions about harm to “the United States’ reputation for rational, fact-based policymaking, and for wise consideration of climate control in the context of geopolitics.”

5. Natural Gas Prices Trended Lower – “Prices for [natural] gas in the United States have trended down even as LNG exports boomed from zero in 2015 to 86 million tons in 2023.”

As you've probably noticed, that strong rebuttal to the Washington Post’s op-ed comes from the Washington Post’s own editorial board.

Kudos to the Post’s editorial writers for debunking many of the Biden administration’s reasons for freezing pending and future U.S. LNG projects – and, as well, the activist-authored op-ed (from which the administration may well have borrowed talking points).

Let me build on the Post’s reasoning in a couple of key areas, and add one of my own, on climate:

Security

America’s natural gas producers helped Europe avoid the worst of an energy crisis in 2022, after Russia cut flows of piped Russian natural gas to punish nations that opposed its invasion of Ukraine. America’s allies would have been in dire straits if not for a 141% increase in U.S. LNG in 2022 over 2021. LNG, not wind and solar, staved off disaster in Europe.

The op-ed’s authors would have everyone believe that Europe’s energy crisis is over, and that America’s LNG no longer is needed. The Europeans certainly don’t think so. Didier Holleaux, president of trade association EuroGas told POLITICO last week (emphasis added):

“[America’s] LNG has been a relief for Europe and contributed to the stabilisation of gas and electricity prices in Europe for consumers, after a long period of record high prices caused by the Russian supply drop. [A lack of additional U.S. LNG capacity] would risk increasing and prolonging the global supply imbalance.”

In fact, a recent Rystad Energy analysis says Europe faces a looming supply gap. As the world’s leading LNG supplier, the U.S. is well-positioned to meet that need. Which we should, because the security of America’s allies strengthens our own security.

Consumers

The op-ed’s authors must have mailed it in on domestic natural gas prices – lamely falling back on the since-disproved assumption – mostly spread by LNG opponents before the U.S. began to flex its LNG muscle – that supplying LNG would negatively impact American families and businesses. In fact, the opposite has been true.

U.S. natural gas prices remain among the lowest in the world, according to the International Energy Agency. While U.S. LNG shipments reached record highs in 2023, domestic prices tumbled 62% from the 2022 annual average as U.S. natural gas production also surged to record levels. This shows the ability of America’s natural gas producers to meet rising global demand while keeping the domestic market well supplied.

Along with this, LNG has provided significant domestic jobs and economic benefits. This is quantified in a recent ICF study, which estimated that meeting President Biden’s LNG pledge to Europe would: support an average of 71,500 jobs  each year from 2025 to 2030; spur $63.1 billion in capital expenditures for facilities and pipeline projects throughout the supply chain; and contribute a total of $46 billion to the U.S. economy over the same five-year period.

LNG vs. Coal

Natural gas opponents have made a lot of noise based on an unpublished, still-under-review study by a longtime natural gas foe, falsely claiming that LNG is worse for the climate than coal. Credible science says otherwise.

According to the U.S. Energy Information Administration (EIA), using natural gas as a fuel results in fewer emissions of nearly all types of air pollutants and carbon dioxide (CO₂) than burning coal – about 50% fewer emissions of CO₂. We’ve seen this help reduce U.S. emissions.

Switching to natural gas from coal to fuel power generation is the main reason U.S. CO₂ emissions from that sector are at generational lows. EIA says natural gas has accounted for more than 60% of the CO₂ emissions reductions in the power sector from fuel switching – about twice as much as the emissions attributed to renewable fuel sources.

Meanwhile, U.S. LNG suppliers are global industry leaders in reducing greenhouse gas emissions. For example, Cheniere reports that between 2016 and 2020, methane emissions intensity decreased 52% at its facilities. Cheniere’s methane emissions intensity of 0.008% was below the Oil and Gas Climate Initiative’s target of 0.2% (also EPA’s Waste Emissions Charge threshold for production). Sempra reports achieving a greenhouse gas emissions intensity of 41% less than its 2020 baseline (the company’s goal was 20%). Other companies have reported similarly.

So, the question is: Why would the administration, activists – anyone – do an about-face and basically encourage more coal use? IEA already projected that 2023 would see record levels of coal use, and the president’s LNG freeze can only continue that trend, because coal is the leading alternative to LNG in the growing economies of India and across Asia, not wind and solar.

The bottom line is the Biden administration has made a poor energy and security decision to restrict U.S. LNG. For an administration that has made plenty of bad energy calls over the past three years, this may be one of the worst.

Congress – including a number of members of the president’s party who have expressed misgivings about the LNG freeze – should push to reverse the decision, for America’s security, the security of America’s allies and for American credibility as the world’s energy leader.

The Post’s editorial concludes:

“There is still time to work out a more sensible and sustainable approach in the next presidential term. Any such approach would understand that the United States needs to help save the planet from two threats: climate change and autocratic regimes that use energy as a geopolitical weapon.”

Could hardly have said it better myself.