Unrestricted natural gas exports could have "disastrous" effects on the U.S. economy, energy industry leaders argued Thursday, warning that shipping large amounts of the nation's newly-abundant resource would result in crippling price hikes for American consumers and manufacturers.
Backing up its claims, the newly formed coalition, America's Energy Advantage, released new survey results showing that the vast majority of taxpayers oppose unfettered gas exports and think "American natural gas should be used for American economic growth." Almost 80 percent of respondents said "no" when asked whether companies should be allowed to export natural gas without restrictions, the survey found. Another 81 percent said exports should be restricted until there's a better understanding of how exporting would affect gas prices stateside.
AEA's findings come on the heels of a Department of Energy study showing the U.S. stands to realize a significant economic boost from exporting a large portion of its domestic gas production to energy-hungry markets in Europe and Asia. Still, critics aren't convinced that massive exports are in the best interests of the nation.
"The current abundant supply of natural gas is helping keep utility bills affordable and the price of natural gas will rise if large-scale exports are approved," Dave Schryver, executive vice president of the American Public Gas Association said at a luncheon announcing the survey results. "The price of natural gas will rise if exports are approved."
Thanks to low natural gas prices in recent years, investment is high in various natural-gas-related industries and jobs are coming back to the beaten-down manufacturing sector. Some companies are even bringing back positions that were shipped overseas just a few short years ago.
"The shale gas boom has really brought a competitive advantage—the biggest I've seen in my 34 years [in the industry]," said George Biltz, vice president of energy and climate change at Dow Chemical Company. Biltz added that as a direct result of the surge in natural gas production, Dow has planned more than $4 billion in new investments in facilities along the gulf coast, including re-opening a plant in Louisiana that's been idle since 2009.
But critics argue that the injection of capital into the U.S. economy could grind to a halt if the government allows unlimited exports of natural gas, especially with the growing laundry list of potential demand centers, ranging from manufacturing to electricity generation to transportation.
"If you stack up the demand, you can get to levels of demand that the industry has never been able to meet," said Peter Molinaro, vice president of federal and state government affairs at Dow. "[Domestic demand] plus exports could get you to a number that would require [an amount] that has never in history been produced."
Others are more confident in the ability of natural gas production to keep up with and even surpass demand. In a letter drafted Thursday to Energy Secretary Steven Chu, the Marcellus Shale Coalition—which represents more than 300 member companies along the natural gas supply chain—urged the Department of Energy to approve all pending export applications, even for non-free trade agreement countries.
Under current law, the DOE can issue licenses to companies seeking to export natural gas to non-free trade agreement countries if the agency finds a public interest in doing so.
"Moving forward with the timely permitting of [natural gas] exports to our nation's allies and global trading partners will lead to more American job creation, economic growth, a reduction in our trade imbalance, and cleaner air—all of which is in the public interest," the letter argued.
Bill Cooper, President of the Center for Liquefied Natural Gas, agreed: "Exporting [natural gas] is a winner for American jobs and the economy," he said in a released statement. "America's newfound gas supplies are so abundant that we can meet our needs here at home and enhance America's competitiveness in the global marketplace by selling some to our trading partners at the same time."