Sunday, October 24, 2021

Trade group urges Department of Energy to restrict US liquefied natural gas exports

A producer trade group has called on the Department of Energy (DOE) to order US liquefied natural gas (LNG) producers to reduce exports, amid fears of a potential supply crunch this winter.

In a letter to US Secretary of Energy Jennifer Granholm (PDF) on September 17, Industrial Energy Consumers of America (IECA), a trade group representing chemical, food and ingredients manufacturers, called on the Department of Energy to take “immediate action”. Said and restrict the export of LNG until the US inventories increase.

“We urge you to take immediate action under the Natural Gas Act (NGA) to prevent a supply crisis and price hikes for consumers that require LNG exporters to reduce export rates so that US goods can be sold for 5 years.” in order to be allowed to reach the average storage level of.

“The health and national security of American consumers, the economy, must take priority over LNG export profits.”

The industrial organization also requested that DOE suspend all existing, pending and pre-filing export authorizations for new LNG export plants in the lower 48 states of the United States.

IECA called for a “review of whether these facilities are in the public interest under the NGA,” adding, “we are certain they are not.”

Natural gas prices have risen more than 35 percent in the past month amid reduced supply and increased demand as economies hit by the pandemic worldwide, raising fears that if temperatures are particularly cold. If it were, there would not be enough gas storage for the winter. in the Northern Hemisphere.

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Meanwhile, rising international demand for US exports of LNG has also added to the rise in prices of natural gas, which is used for heating and generating electricity as well as processing chemicals, fertilizers, paper and glass, among other commodities. is done for.

IECA said US prices would need to be raised to $10 per MMBtu to provide incentives to meet domestic natural gas demand, noting that such prices could “destroy” manufacturing demand.

“Many manufacturers can no longer compete in the market at those prices. In 2008, we saw thousands of manufacturing facilities shut down because they were no longer profitable,” IECA said.

Gas levels in U.S. storage are down 7.4 percent from the five-year average and 16.8 percent below the year-ago level, according to the Energy Information Administration.

“To increase storage inventories to a five-year average by November, the US would have to inject more than 90 billion cubic feet (bcf) each week, a rate 40 percent higher than the five-year average weekly buildup rate. . EIA Supply The data makes it clear that increased production will not be forthcoming,” IECA wrote.

Despite the IECA’s call, the framework for immediate changes to the NGA, providing regulatory control over the interstate sale and transportation of natural gas, is unlikely.

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Katabella Roberts is a reporter currently based in Turkey. She covers news and business for The Epoch Times, focusing primarily on the United States.

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This News Originally From – The Epoch Times

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