Not All the Fracking News Is Good
12:00 AM, Mar 29, 2014 • By IRWIN M. STELZER
Some 16 groups have sent a letter to the White House opposing a proposed LNG facility in Maryland on the grounds that approval runs contrary to the administration’s effort to fight climate change. Ironically, the administration’s attempt to curtail the use of coal here in the U.S. has resulted in a spurt in exports of this carbon-intensive fuel to overseas markets to which exports of natural gas are limited.
That is not the only reason only six of 37 applications to build the terminals needed to liquefy natural gas for export (at an estimated cost of $30 billion each) have climbed the first step on the ladder to approval, and that only one is under construction. Environmental groups fear the impact on areas in which these terminals would be built. A powerful lobby, America’s Export Advantage, led by Dow and Alcoa, wants to keep these resources right here for domestic use at low prices, and the law requires special government review of any natural gas exports to nations with which the United States does not have a free-trade agreement (FTA). Since no such agreement exists with the European Union, and negotiations are dragging on over chickens, safety regulations, permission to call cheese made in America “Parmesan cheese” and other weighty issues, any exports to the EU will have to survive public comment and regulatory review, which is difficult although not impossible -- one has survived the required review by both the Department of Energy and the Federal Energy Regulatory Commission, and three have passed DOE muster and await word from FERC. Meanwhile, exports are stalled, giving green groups time to campaign to have fracking sharply curtailed because, they contend, it threatens the purity of water supplies, and the oil it produces is more combustible than crude oil from traditional wells.
Add to all of this a 40-year old statute that makes it virtually impossible for American companies to export crude oil, and it will be a long while before America becomes what it might become -- the world’s largest exporter of LNG, and a major exporter of crude oil. Good news for America’s petrochemical industry, for Americans who use gas-fired electricity and heat their homes with natural gas, and for Vladimir Putin.
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