By Daniel Foelber and Brent Haight
On January 26, 2024, the Biden Administration announced a temporary pause on pending decisions for exports of liquefied natural gas (LNG). The response was swift. Environmentalists heralded the move as a win for planet earth, citing the benefits of reducing dependence on fossil fuels. Energy lobbyists and political pundits cried foul, claiming the decision will cost American jobs, cripple the economy, and abandon European allies who have relied heavily on US LNG since Russia’s invasion of Ukraine.
Thanks to the insatiable appetite of the 24-hour news cycle and the fact that 2024 is an election year, the amount of misinformation being lauded as truth from both sides is immense. There is no shortage of speculation, knee-jerk responses, and political posturing. What follows is an attempt to filter out the noise. Here’s what we know.
The Pause
The Biden Administration paused approvals for pending and future applications to export LNG. The pause applies to new projects and expansions to existing projects that aren’t already under construction. During this time, the US Department of Energy (DOE) will conduct a review that will “take a hard look at the impacts of LNG exports on energy costs, America’s energy security, and our environment.”
Existing and under construction US LNG projects are not affected by the pause. Seven LNG terminals are currently operating in the United States. As many as 11 expansions could come online in the next five years.
“There’s a long runway here [for LNG projects] and we’re taking a step back and thinking, okay, let’s take a hard look before that runway continues to build out,” said White House Climate Adviser Ali Zaidi in a press statement.
“The pause will allow officials to update the way LNG proposals are analyzed to avoid export authorizations that diminish our domestic energy availability, weaken our security, or undermine our economy or the environment,” said Energy Secretary Jennifer Granholm in a press statement.
The last review of LNG export projects took place in 2018 when US LNG exports were 4 Bscf/d (113.2 × 109 m3 /d). Between 2016 and 2020, the United States added more than 66 MTPA of capacity (see “LNG Race Report No. 5: United States,” February 2021 Gas Compression Magazine, p. 14). In 2023, US LNG exports reached 12 Bscf/d (339.8 × 109 m3 /d).
“The current economic and environmental analyses the DOE uses to underpin its LNG export authorizations are roughly five years old and no longer adequately account for considerations like potential energy cost increases for American consumers and manufacturers beyond current authorizations or the latest assessment of the impact of greenhouse gas emissions,” the White House said.
The Grey Areas
Opponents of increased LNG infrastructure may find that the pause is less impactful than it seems at first glance. To quote President Biden’s statement, “My administration is announcing today a temporary pause on pending decisions of liquefied natural gas exports — with the exception of unanticipated and immediate national security emergencies.” Pending decisions is the key term here.
LNG projects are just as much of an organizational feat as they are an engineering marvel. There are many projects that have been … The article continues in the March issue of Gas Compression Magazine. Click here to continue reading in the online edition, absolutely free!
