The U.S. Department of Energy is making moves to implement policy under the President Joe Biden administration before President-elect Donald Trump is sworn in next month.
On Tuesday, the agency released a report calling for fewer liquified natural gas (LNG) exports, sparking cries of outrage from Trump supporters in government and the gas industry calling the new DOE research an attempt at sabotage of the incoming administration’s energy ambitions.
The report generated national headlines, as Biden’s Energy Secretary Jennifer Granholm spoke out about research findings that caution against an increase in LNG exports.
"Unfettered exports of LNG would increase wholesale domestic natural gas prices by over 30%,'' costing American households an additional $100 a year by 2050, Granholm said.
Backlash over what Granholm called an "export-induced price increase" heated up immediately.
Wyoming congresswoman Harriet Hageman responded with this sharp rebuke: “Biden’s actions represent blatant transition interference and a rejection of the clear will of the people.”
Republican U.S. Sen. John Barrasso, who sits on the Senate Energy and Natural Resources Committee, agrees with Hageman.
“Studies have repeatedly shown that American liquefied natural gas exports benefit our economy, our environment, our security and the security of our allies,” he said. “Nothing in a biased study from a bitter administration on its way out the door can change that."
Ryan McConnaughey, vice president and director of communications for the Petroleum Association of Wyoming, told Cowboy State Daily that it’s another example of the Biden administration’s anti-fossil fuels agenda.
“This report is just another example of the Biden administration’s efforts to end development of natural gas and oil on federal lands — for which Wyoming ranks second in the nation,” he said.
McConnaughey spotlighted opportunities for Wyoming to increase LNG exports, underlining the need for an LNG shipping terminal Wyoming producers can export from on the west coast.
That would “unlock the potential for Wyoming natural gas to be exported to Asian markets that are clamoring for reliable, affordable sources of energy,” added McConnaughey.
The Upside Of LNG
Supporters of increased LNG exports point out that the industry has become a key player in economic growth, supporting more than 270,000 jobs nationally and contributing to the U.S. gross domestic product, according to findings from S&P Global.
Critics of the recent DOE report argue concerns about rising costs for LNG are misplaced, noting that natural gas prices for U.S. customers remain stable even as exports surge to record highs.
U.S. House Oversight Committee Chairman James Comer, R-Kentucky, called the DOE report a, “Hail Mary political effort to advance radical, far-left energy policies,” according to a Wednesday press release.
Louisiana Gov. Jeff Landry, who chairs the Governors' Coalition for Energy Security, also issued a statement, arguing that the DOE's study cherry-picked data.
“This report was designed to support a predetermined policy outcome — the throttling of America’s record LNG growth — rather than provide an objective analysis of LNG's benefits to American workers and our economy,” Landry said.
The DOE's 2024 LNG Export Study, which takes a close look at the economic, environmental and security implications of U.S. LNG exports, is open for public comment for 60 days.
Wyoming LNG In Demand
LNG is exported in reinforced tanks at temperatures of minus 260 degrees as a cryogenic fluid that takes about 1/600th the volume of natural gas in its gaseous state. It’s shipped by truck, railcar and specialized seagoing tankers.
A report released last month by the University of Wyoming’s Center for Regulation and Policy Analysis found Wyoming's natural gas production increased by 16.42% year-over-year as of July 2024, reaching a total of 103,592 million cubic feet.
At the same time, according to the UW report, natural gas prices declined by 13.64% year-over-year, with a price of $2.28 per million BTU as of September 2024. Additionally, U.S. natural gas electric power prices have decreased by 15.64% since early 2023.
Another Roadblock?
A number of NGOs and Biden administration supporters spoke out in favor of the DOE report’s findings, including Rachel Cleetus with the Union of Concerned Scientists.
"The DOE study provides critical updates on the immense economic, environmental and climate harms of LNG exports,” said Cleetus.
Gillian Giannetti, senior attorney with the Natural Resource Defense Council, also issued a statement praising how, "This detailed analysis highlights the stark and obvious reality that ever-expanding LNG exports are not in the public interest. LNG exports threaten frontline communities and American pocketbooks.”
Brushing off these critiques, Gov. Mark Gordon celebrated Wyoming’s place among the top natural gas producers in the nation.
“We have always supported the export of natural gas, whether that be through the Gulf Coast or the West Coast,” offered Gordon’s office in a statement Thursday. “The Biden pause was merely another roadblock to sensible development of the U.S. energy market, and this study appears to serve as a justification for that pause.
“Wyoming was one of 16 states to challenge the president's export pause, and the governor remains hopeful that the Trump administration will end the pause and unleash American energy.”
Some press coverage characterized the report as a gift to opponents of natural gas expansion, offering fodder for future legal challenges.
The Trump administration is expected to ignore the report, according to a Wednesday story in Politico, which reiterated Trump’s pledge “to ramp up fossil fuel production to achieve ‘energy dominance,’ building on the sharp growth that lifted oil production to record levels this year and made the United States the world’s leading supplier of liquefied natural gas.”
