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Fossil fuel industry furious with Biden for halting natural gas production

By Mandy Donalds
|
January 26, 2024

A broad coalition of over 30 fossil fuel industry associations is voicing strong concerns over a potential White House move to postpone permits for crucial natural gas export facilities due to their projected climate impacts.

The industry is up in arms following a report that the White House might halt the permitting process for key natural gas export facilities, citing environmental concerns.

\More than 30 fossil fuel organizations, including prominent ones like the American Petroleum Institute (API) and American Exploration and Production Council (AXPC), have openly criticized the potential decision. They argue that such a move would not only jeopardize American jobs but also risk the energy security of allied nations, as FOX News reported.

Industry giants pen a critical letter to the Energy Secretary

In a letter to Energy Secretary Jennifer Granholm, these groups expressed their dismay, labeling the potential pause in permitting as a "major mistake."

The letter's timing coincides with a report from The New York Times suggesting that President Biden is set to mandate climate impact assessments for 17 proposed liquefied natural gas (LNG) export terminal projects.

The coalition's letter emphasizes the United States' leading role in natural gas production, highlighting its importance in meeting both domestic demand and international energy needs.

2023 saw the U.S. becoming the top exporter of LNG, a status that the industry believes enhances the nation's geopolitical stance and insulates American consumers from global energy market fluctuations.

The geopolitical and economic implications of halting LNG exports

Industry representatives argue that halting the approval of LNG export facilities would inadvertently strengthen Russia's influence in the energy sector.

They assert that such a move would contradict President Biden's commitment to ensuring reliable energy for U.S. allies, thereby undermining America's credibility and threatening numerous domestic jobs.

The necessity of LNG export facilities, according to the industry, is underscored by the energy demands in Europe and Asia.

These regions are actively seeking alternatives to Russian natural gas, especially in the wake of Russia's invasion of Ukraine in early 2022.

Following the invasion, Biden pledged to augment U.S. LNG exports to the European Union, a commitment echoed by energy associations in Europe and Asia advocating for the continued approval of U.S. LNG export terminals.

Internal deliberations lead to a more rigorous environmental review

Internal sources, as reported by the New York Times, indicate that President Joe Biden intends to direct the Department of Energy (DOE) to undertake a more comprehensive environmental review of the 17 pending LNG export terminals.

This marks a significant shift from previous practices, as the DOE has not traditionally analyzed the climate impact of such projects, nor has it ever rejected a gas export application on climate grounds.

Mike Sommers, CEO of API, expressed his viewpoint starkly, stating:

This would be a win for Russia and a loss for American allies, U.S. jobs and global climate progress.

Sommers further criticized the potential policy shift as a betrayal of U.S. commitments to its allies and accused the administration of politicizing global energy security.

Industry proponents also argue that natural gas, being a cleaner alternative to coal, plays a crucial role in meeting global decarbonization targets.

Environmental gains and the global energy landscape

The industry letter addressed to Granholm underlined the United States' achievements in reducing carbon emissions, largely attributed to the increased reliance on natural gas.

This shift led to natural gas surpassing coal as the primary source of electricity generation in the U.S. after 2015.

Anne Bradbury, CEO of AXPC, advocated for increased LNG exports, suggesting that hindering this industry could have detrimental effects on the U.S. economy, global emission goals, and the security of allied nations.

One of the projects at stake is the Calcasieu Pass 2 (CP2) project, a proposed LNG terminal in Louisiana. This facility alone is expected to boost U.S. LNG exports by 23%, a testament to its significant role in the global energy market.

Uncertainty and concerns over the administration's intentions

Shaylyn Hynes, a spokesperson for energy developer Venture Global, voiced concerns over the perceived opacity of the White House's intentions.

Reports based on information from anonymous sources have led to speculation and uncertainty, especially regarding the reliability of U.S. LNG for allied nations' energy security.

Hynes elaborated on the potential repercussions of the reported policy change, saying:

Such an action would shock the global energy market, having the impact of an economic sanction, and send a devastating signal to our allies that they can no longer rely on the United States.

Conclusion

  • A coalition of over 30 fossil fuel industry associations is protesting a possible White House decision to delay permits for crucial natural gas export facilities, citing potential climate impacts.
  • The industry warns that halting LNG export approvals could undermine U.S. geopolitical influence, economic stability, and the energy security of allied nations.
  • President Biden's expected directive for a rigorous environmental review of LNG export terminals marks a significant shift in policy, drawing criticism for potentially benefiting adversaries and betraying commitments to allies.
  • Proponents of the fossil fuel industry argue that natural gas is essential for meeting global energy demands and decarbonization goals, with the U.S. leading in carbon emission reductions due to its shift from coal to natural gas.
  • The controversy underscores the complex interplay between energy policy, geopolitical strategy, environmental concerns, and economic interests.