Thursday, April 10, 2014
LNG exports important to United States economy
Advances in technology are bringing southwest Mississippi closer to the shale boom that scientists and energy producers have anticipated in the area for years. The geologic formation known as the Tuscaloosa Marine Shale, which spans parts of Louisiana and Mississippi, is estimated to hold some seven billion barrels of oil – making it possibly one of the largest fields in the country.
Although more exploration is needed, the potential for horizontal fracturing techniques to extract from the deep reserves has infused new energy into local economic development. Counties like Amite could see new jobs, business investment, and higher home values, underscoring the value of energy production to Mississippi and the United States.
Administration’s Roadblocks Hampering Job Potential
America is the world’s top producer of natural gas, thanks in part to our abundant shale resources. Liquefied natural gas, or LNG, is the form in which natural gas is most often shipped, and these exports are a major source of good-paying jobs and economic revenue. According to the World Economic Forum, every job directly created by oil and gas extraction in turn drives the creation of three new jobs in other parts of the economy.
Despite this positive outlook, however, the Obama Administration has been slow to approve applications for LNG exports. Only one LNG export facility has cleared all of the Administration’s regulatory hurdles for construction, and there are 24 more applications still pending to export LNG to countries that do not have a free trade agreement with the United States. One of these facilities awaiting approval is the $1 billion LNG terminal in Pascagoula, which submitted its application in 2012. Expediting the application process is crucial to reaping the economic benefits associated with domestic energy development.
U.S. Energy Could Diminish Russia’s Leverage
A thriving LNG export market also matters to America’s national security interests. This is particularly true in light of Russia’s aggression in Ukraine. As The Economist noted last month, replacing Europe’s dependency on Russian energy is “a weapon of geopolitics as important as any warship.” The United States can diminish the Kremlin’s leveraging power by offering European allies an alternative to the oil and gas resources they get from Russia. The effect would likely drive down prices and shrink the revenue that flows back to Moscow.
The United States is right to impose tough sanctions on Russia, but we must also utilize our capacity to apply pressure where it will hurt the Kremlin the most. Oil and gas make up about half of Russia’s revenue. Without this dominance in European markets, Russia would lose its ability to intimidate with threats of shutting off energy supplies.
Expediting LNG Exports Draws Bipartisan Support
Bipartisan efforts in the Senate are working to boost LNG exports. For example, I have joined 22 of my colleagues in cosponsoring legislation introduced by Sen. John Barrasso (R-Wyo.) to expedite applications for exporting natural gas to NATO members, Japan, and other countries that support U.S. interests.
America’s leadership abroad goes hand-in-hand with the pursuit of an “all-of-the-above” energy approach here at home. LNG exports are a strategic way to strengthen our energy security and that of our allies. These exports also pave the way for a robust market as the Tuscaloosa Marine Shale in Mississippi is explored. It is past time to seize America’s remarkable energy potential.
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