Politics

Business group, Dem senator move to stymie natural gas exports

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Michael Bastasch Energy Editor
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The main opposition to sending American natural gas abroad comes not from environmentalists, but from one industry group and Michigan Democratic Sen. Debbie Stabenow.

The U.S. is in the midst of a natural gas boom and lawmakers are debating whether or not the government should fast-track the permitting of liquefied natural gas (LNG) terminals. Environmentalists represent part of the opposition to LNG exports, but the bulk of the opposition comes from a coalition of manufacturers that rely on natural gas.

America’s Energy Advantage (AEA) is the main opposition behind the opposition of LNG exports, arguing that it would raise energy prices and harm the country’s industrial renaissance. AEA is backed by companies that would benefit from cheaper natural gas, including Dow Chemical, which is headquartered in Michigan — the state Stabenow represents.

Stabenow has made many statements against fast-tracking LNG terminal approvals, and she recently used her political clout to hold up an Obama administration Energy Department appointment in January over LNG export concerns.

“I am concerned that they are not understanding that they need to have a pause in the new approvals on facilities until we see what impact the current approvals will have … how it affects manufacturing,” Stabenow said in January, regarding the Obama energy nominee Christopher Smith.

Stabenow’s opposition to Smith, who oversaw the Energy Department’s export policy, likely stemmed from AEA’s push to get the government to freeze LNG export approvals. E&E News reported that “[s]ources said the senator’s concerns likely stem from Michigan-based Dow Chemical Co., which has joined other large industrial users of natural gas in asking the Obama administration to freeze LNG export approvals.”

But Stabenow suddenly came around in February, saying she was “comfortable” with the administration’s long-term strategy on LNG export approvals.

“I’ve been working with the secretary, and I’m comfortable with what he is talking about as a strategy at this point longer-term,” Stabenow said in February. “I’m not going to object to this particular one [export license]. I think we’re more on the same wavelength.”

Her remarks came on the heels of the Energy Department’s approval of an LNG terminal in Louisiana. Dow Chemical and AEA, on the other hand, had some harsh words about the terminal’s approval, pushing harder for a “pause” in LNG terminal approvals.

“This latest approval is a big win for our global competitors and another blow to American consumers who are paying and will continue to pay higher prices to heat their homes,” AEA said in a statement. “We reiterate our call for the Administration to take an immediate ‘time out’ from further LNG export approvals until a new, comprehensive, and consensus review of current market conditions is completed.”

Stabenow’s more positive comments raised suspicions among lawmakers that she may have cut some sort of “secret” deal with the White House on the pace of LNG export terminals.

“Some press reports have indicated that there’s been potentially some kind of deal struck between [the Energy Department] and Sen. Stabenow,” Ohio Republican Rep. Bill Johnson said during a hearing last week.

“She was opposed to liquid natural gas exports, she was putting a hold on one of your… nominee’s coming through the Senate,” Johnson added. “But now she has said ‘hey, I’m now more comfortable with what the department is doing.”

Energy Secretary Ernest Moniz told Congress that his department had not stuck a secret deal with Stabenow and that there were several senators with reservations about LNG exports. But some energy analysts have predicted that Stabenow and Moniz agreed to a “pause” in LNG export terminal approvals, which is what AEA has been pushing.

Stabenow received $30,200 from Dow Chemical in the 2012 election cycle, according to the Center for Responsive Politics.

The advent of hydraulic fracturing and horizontal drilling has brought about an American oil and natural gas boom. Lawmakers have been debating whether or not is in the country’s interest to export some of this gas to foreign nations.

The Obama administration has moved slowly to approve LNG terminals, only approving six with more than 20 applications still waiting. Lawmakers and the oil and gas industry are urging the administration to move quickly to approve terminals, especially in the wake of Russia’s invasion of Ukraine.

Environmentalists and some companies have opposed natural gas exports, but for different reasons. Green groups oppose them on the grounds that exports will contribute to global warming and increase domestic drilling, but their influence has been muted among key Democrats who usually support environmental initiatives.

Colorado Democratic Sen. Mark Udall, for example, has introduced a bill to make it easier for U.S. gas to be exported to more countries. Udall’s bill would allow natural gas to be shipped more easily to countries belonging to the World Trade Organization and not just to countries that have free trade agreements with the U.S.

“The ongoing crisis in Ukraine — and Russia’s threat to use its natural gas exports as a cudgel there — shows why we need to responsibly develop our natural gas reserves and expand our ability to export this resource abroad,” said Colorado Democratic Sen. Mark Udall. “This common-sense bill will strengthen our economy at home and help Colorado companies and small businesses across America bolster our presence abroad.”

Udall’s bill is currently sitting in the Senate Energy and Natural Resources Committee. The House version has 42 cosponsors — 41 Republicans and one Democrat, Ohio Rep. Tim Ryan.

Stabenow’s office did not respond to The Daily Caller News Foundation’s request for comment.

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