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POLITICS: PennAve

Energy Department approves natural-gas export project

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Barack Obama,Energy Department,PennAve,Energy and Environment,Zack Colman,Natural Gas

The Energy Department approved a liquefied natural gas (LNG) export project Tuesday, a move that could soothe lawmakers' and industry worries that the Obama administration is moving too slowly on the proposals.

The Sempra Energy-owned project in Louisiana is the sixth the Energy Department has green lighted for exporting LNG to nations that lack free-trade status with the United States. Such deals draw more scrutiny because federal law says they must be in the public interest.

The announcement comes a week after Republicans on the House Energy and Commerce Committee released a report detailing the benefits of LNG exports. The report, along with recent calls from industry, cautioned that the U.S. might be edged out of the growing global market if it takes too long to process applications.

"The faster these terminals are approved, the faster Americans can enjoy the full benefits of the U.S. energy revolution," said Erik Milito, director of upstream and industry operations with the American Petroleum Institute.

With the approval, 24 applications to export LNG to non-free trade nations remain on file at the Energy Department. The project would allow Sempra to ship up to 1.7 billion cubic feet per day from the southwest Louisiana site for up to 20 years, though it still needs to get permits from the Federal Energy Regulatory Commission — a process that usually takes more than a year.

While Republicans and many centrist Democrats have urged faster approval, some Democrats — such as Sens. Ron Wyden of Oregon, Debbie Stabenow of Michigan and Ed Markey of Massachusetts — have urged caution. They're concerned that a rapid expansion of LNG exports would raise domestic prices, in turn handicapping a competitive advantage for the manufacturing industry.

A December 2012 study by NERA Economic Consulting, which was commissioned by the Energy Department, said exports would be a net positive for the economy, though it did say domestic prices would rise marginally. An update of that study with more recent supply and demand figures from the U.S. Energy Information Administration is expected this year.

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