DOE Approves LNG Exports To Non-Free Trade Nations

The Energy Department (DOE) on Friday approved a controversial application allowing liquefied natural-gas exports to nations that lack a free-trade agreement with the United States. The department gave the green light to Freeport LNG Expansion and FLNG Liquefaction’s proposal to send 1.4 billion cubic feet per day of natural gas overseas from a terminal on Quintana Island, Texas, for 25 years.

The project is the second to get DOE approval to send natural gas to non-free trade nations. The developers will now take their plan to the Federal Energy Regulatory Commission (FERC).

President Obama has also signaled  in recent weeks that he plans to move on some of the 20 applications in the DOE’s queue.

Several Democrats and some chemical manufacturers have warned against an unfettered expansion of exports. They worry shipping too much natural gas abroad would cause domestic prices to spike.

Republicans and business groups say exports figure to be restrained. They argue only a handful of the applications on file would get DOE approval, and that many would not follow through with the costly FERC process that follows.  Export proponents also contend that the economic benefits — such as new jobs and reducing the federal trade deficit — would outweigh likely modest price increases. (The Hill, 5/17/2013)