Administration’s LNG Freeze Runs into Bipartisan Opposition in Congress

Mark Green
Posted February 6, 2024

President Biden’s decision to freeze pending and future permits for supplying U.S. liquefied natural gas (LNG) to America’s allies has not gone over well with many in Congress.

Opposition to the administration’s LNG moratorium includes Republicans and a number of Democrats, including both U.S. senators from Pennsylvania, a key battleground state. The political gamesmanship involved with the freeze even caught the eye of the Washington Post editorial board last week:

The LNG freeze is an “election-year sop to climate activists that will do much more to unsettle vital U.S. alliances than to save the planet.”

Other attempted justifications are little more than an apron sewn from fig leaves, trying to hide what’s really behind the LNG moratorium. Many in Congress aren’t going for it.

A bipartisan group from the House sent a letter to President Biden on Sunday, saying the freeze “threatens national security, the economy, and clean energy goals.” This followed a similar letter from 10 House Democrats last week, urging the administration not lose sight of LNG’s benefits, as well as a joint statement from Sens. Bob Casey and John Fetterman of Pennsylvania, concerned the LNG pause would hurt jobs in the Keystone State. Sen. Joe Manchin, D-West Virginia and chairman of the Energy and Natural Resources Committee, also had fighting words on the freeze:

“America’s LNG policy should be based on facts, not politics. The indisputable facts are that, to-date, America’s LNG production has strengthened our economy, created good-paying jobs, supported the energy needs of our allies around the world, and helped reduce global emissions.”

Maybe none of this resonates at a White House that, unfortunately, has taken its eye off the ball now that the calendar has flipped to 2024. Yet, opponents of the LNG freeze know what many Americans know – that U.S. natural gas production and the supplying of LNG to allies have been good for the security of America and its allies, the U.S. economy, and the environment:

• Security – The security of America’s allies is American security as well. U.S. producers answered the call when Europe saw Russia cut flows of piped Russian natural gas to punish nations opposed to Vladimir Putin’s invasion of Ukraine – a 141% increase in U.S. LNG in 2022 over 2021. Though some talk like Europe is safe now, a recent analysis says Europe faces a looming supply gap.
• Prices – U.S. natural gas prices remain among the lowest in the world. While U.S. LNG shipments reached record highs in 2023, domestic prices fell 62% from the 2022 annual average – as U.S. natural production also surged to record levels. Both directly rebut administration suggestions that a review is needed to assess the effect of LNG on Americans.
• Jobs – It’s not hard to understand the angst of Sens. Fetterman and Casey. Natural gas production and LNG has had significant domestic economic benefits. A recent study estimated that meeting the president’s promise to supply Europe with America’s LNG would support an average of 71,500 jobs each year from 2025 to 2030, generate $63 billion in capital expenditures and contribute a total of $46 billion to the U.S. economy over the same five-year period. Outside Washington, those numbers mean a great deal.
• Climate – Credible science has said that using natural gas as a fuel instead of coal results in fewer emissions of nearly all types of air pollutants and carbon dioxide (CO₂) – about 50% fewer CO₂ emissions. Indeed, U.S. CO₂ emissions are at generational lows. U.S. LNG could displace coal around the world, if Washington gets out of the way.

While the administration tries to cloak the LNG freeze in climate concern, its actions actually serve to increase coal use. The center-left Progressive Policy Institute (PPI) said that the freeze will put markets, the European Union and Asia in turmoil, “threatening the energy security of our allies with no climate benefit.” Why? Because the freeze “could lead to a world of greater global greenhouse gas emissions as countries that import our gas find dirtier sources, or even revert to coal while killing U.S. jobs and increasing Putin’s leverage in Europe.”

The technical term for that is a lose-lose-lose situation – with America, its allies and climate doing the losing as Russia’s Putin does the winning.

An equally troubling concern is that the administration’s LNG political gamesmanship could have broader, long-term impacts.

In an editorial, the Wall Street Journal dismantles what it calls the administration’s “dishonest” claim that the LNG moratorium won’t affect many projects, only those currently seeking permits from the U.S. Energy Department. But it also freezes a half-dozen more projects seeking Federal Energy Regulatory Commission approvals, the newspaper said, and could halt another dozen that were permitted by previous presidents. In this, the administration may have another motive. The Journal:

“The Administration is deliberately creating uncertainty about permit approvals and extensions to chill investment and discourage foreign governments from signing long-term contracts. Why risk investing in or signing a purchase agreement with a Gulf Coast project that may later be killed? Smarter to link up with the Qataris.”

As we have said, for an administration that has made plenty of bad calls on American energy, this might be the worst. It’s a political year, but American energy policy shouldn’t be a playground for election-year politics. Too much is at stake – for ourselves, our allies and the environment. That’s why, on LNG, so many from both parties aren’t buying what the Biden administration is trying to sell.