Center for LNG: EIA Natural Gas Export Study Reveals Only Part of Economic Picture
Natural gas exports present opportunity to grow US economy, reduce trade deficit and create jobs
WASHINGTON, D.C. (January 20, 2012) -- The Center for Liquefied Natural Gas today said that the Energy Information Administration's (EIA) report on the effects off increased natural gas exports on domestic gas markets is only part of a larger picture of how LNG exports will impact the U.S. economy and does not account for increased economic activity, decreased U.S. trade deficit and increased job creation that it expects will be revealed in a forthcoming macroeconomic study. In August 2011, the Department of Energy's Office of Fossil Energy requested that the EIA prepare the report.
The Office of Fossil Energy has also requested a second study from a third party contractor, which will analyze the macroeconomic effects of increased natural gas exports. The third party study is expected to be released later in the first quarter of 2012.
"The EIA study is just a part of the overall analysis on the economic effects of natural gas exports," said Bill Cooper, president of the Center for Liquefied Natural Gas. "The third party report will provide a more complete economic picture by focusing on the broader macroeconomic effects, which we believe will be positive.
"The EIA study’s predicted natural gas price increases do not account for increased economic activity, decreased U.S. trade deficit and increased job creation that we expect will be revealed in the forthcoming macroeconomic study on LNG exports. GDP growth, job creation and offsetting the U.S. trade deficit would be beneficial in neutralizing any potential price effects. For example, the LNG industry expects each new export project to create thousands of jobs in the natural gas sector and related industries.
“With a 100 year supply of natural gas and more supplies being discovered in new resource areas, the United States is well positioned to meet both the domestic needs of our country and to provide clean burning natural gas to new markets. As the EIA study noted, the vast percentage of exports would be supplied by additional natural gas production. As history has taught us, the natural gas industry overwhelmingly responds to meet new markets, far beyond current-day predictions.
"Markets should ultimately decide whether or not the U.S. should engage in natural gas exports in the future, which is consistent with the long-standing policy of the Department of Energy. America's free trade policy allows for economic growth and job creation by encouraging exports for all kinds of products, including for energy," said Cooper.
EIA's report examines four possible export scenarios. These scenarios consider variables of either 6 Bcf/day or 12 Bcf/day of increased natural gas demand, increasing by 1 Bcf/day per year or 3 Bcf/day per year.
EIA's full report can be accessed on the EIA website.
CLNG is a trade association of LNG producers, shippers, terminal operators and developers, and energy trade associations. Its goal is to enhance public education and understanding about LNG by serving as a clearinghouse for LNG information. For more information, visit www.lngfacts.org.
Posted: January 23, 2012