POLITICS: PennAve

White House splits from some Senate Democrats on natural gas exports

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The White House is splitting from some liberal Senate Democrats over the role natural gas exports can play in weakening Russia's hand in Europe.

Russia's annexation of Ukraine's Crimea region led to calls for the administration to green-light more natural gas exports, to lessen Europe's dependence on Russian energy.

But several Democrats pushed back, arguing more exports would have a limited immediate effect in Europe because most U.S. supplies already head to Asia and because only one export terminal will be ready before 2017.

Not so, says the Obama administration.

"Indeed, most of those supplies of U.S. [liquefied natural gas] that will go onto the market will not get onto the marketplace until 2015," Carlos Pascual, the State Department's top energy diplomat, said Thursday at a Washington event hosted by the Atlantic Council.

"Even if that gas is not going specifically to Europe, it's helping to sustain this concept of competition in the global marketplace, which is fundamental to giving Europe choices," he added.

Those exports, Pascual said, would buoy European countries that have used global supplies freed up by a boom in U.S. natural gas production to leverage contracts with Gazprom, Russia's state-owned energy firm.

His comments underscore increasingly bullish remarks from the White House about the role of natural gas exports as a potential geopolitical tool to lessen Russia's European influence.

Adam Sieminski, the chief of the U.S. Energy Information Administration, said last week at a Senate Energy and Natural Resources Committee hearing that the first federally approved export terminal at Sabine Pass, La., would give more bargaining power to firms looking to renegotiate contracts with large suppliers.

A day later, the White House released a statement following a joint U.S.-European Union summit that it welcomed "the prospect of U.S. [liquefied natural gas] exports in the future since additional global supplies will benefit Europe and other strategic partners."

Republicans and some Democrats on Capitol Hill want the Obama administration to expedite approvals for new natural gas export terminals.

So far, the Energy Department, which oversees export applications, has said it's staying the course on its process.

Energy Secretary Ernest Moniz noted that his agency, in the seven proposals it has approved for export to nations that lack a free-trade agreement with the U.S., has given the go-ahead to export 9.3 billion cubic feet per day. Only Qatar exports more, and not by much.

Export proposals to nations without free-trade agreements must be in the public interest, which invites more scrutiny. Republicans and Democrats alike have floated legislation to change that, such as by giving World Trade Organization or NATO members the same distinction as nations that have free-trade deals with the U.S.

"If a law is passed — passed by Congress, signed by the president — that says, essentially, it's automatic to most countries in the world; well, if that's the law, then obviously we will follow the law," Moniz told reporters Thursday after a House hearing. "But as I said, the caution there is does the Congress in effect want to remove the public interest determination?"

Some lawmakers would object to scrapping the public interest determination, out of concern that there would no longer be a check for keeping domestic natural gas prices stable. In fact, wariness about price increases at home is one of the main reasons lawmakers such as Sens. Debbie Stabenow, D-Mich., and Ed Markey, D-Mass., have urged caution on exports.

That sentiment appears to be in the congressional minority, though Congress is still debating the issue.

Last week, Senate Energy and Natural Resources Committee Chairwoman Mary Landrieu, D-La., said she would look into holding a hearing on a bill from Sen. Mark Udall, D-Colo., that would expedite exports.

"Hopefully we can take this up at some point," she said of the bill, which is co-sponsored by Sen. Mark Begich, D-Alaska, who, like Udall, is facing a tight re-election contest. "I want to thank you, Sen. Udall, for your introduction of this bill."

In the House, the Energy and Commerce Committee will soon hold a markup on a similar bill from Rep. Cory Gardner, R-Colo., who is challenging Udall for his Senate seat. The bill is expected to pass the committee and eventually the full House, but its path after that is unclear.

"I doubt that [Senate Majority Leader] Harry Reid [D-Nev.] is going to pick it up, but I don't know that for a fact," Rep. Ed Whitfield, R-Ky., who chairs the Energy and Power Subcommittee, told the Washington Examiner. "Because a lot of those senators that are running, they're getting a lot of pressure on [liquefied natural gas] exports for a lot of different reasons."

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