European Allies Plead for Expedited US LNG

Two Eastern European officials pleaded with the Senate and House of Representatives today to help expedite the flow of US natural gas into the world marketplace.

The two Europeans —Jaroslav Neverovič, Energy Minister of the Republic of Lithuania, and Anita Orbán, Hungary’s Ambassador-at-Large for Energy Security— delivered similar messages. Both urged Congress to work with the Obama administration or enact legislation to increase the rate of DOE LNG export licenses to nations (such as theirs) without Free Trade Agreements (FTA).

Senate Energy & Natural Resources Committee Hearing

Sen. Mary Landrieu (D-LA) chose the LNG export issue to be the subject of her first hearing as the new chair of the committee and was joined by 10 of her colleagues: Sens. Wyden (D-OR), Stabenow (D-MI), Udall (D-CO), Franken (D-MN), Manchin (D-WV), Baldwin (D-WI), Murkowski (R-AK), Barrasso (R-WY), Flake (R-AZ), and Scott (R-SC).

The two hour webcast of this morning’s hearing is now available on the committee’s website as are the written statements of the witnesses: Click Here. And, as this is distributed (late afternoon), news reports are also starting to appear: E&E Greenwire (subscription); The Guardian; Reuters; International Business Times; and Bloomberg (includes news from House hearing). Also, if you are a Financial Times subscriber, this story appearing before the hearing is also interesting: Click Here.

Minister Neverovič’s best quotes included these:

  • “At present, Lithuania is completely—100 percent—dependent upon a single supplier of natural gas and, as a result, we are forced to pay a political price for this vital energy resource. Lithuanian families and businesses pay 30 percent more for natural gas than citizens in other European countries.”
  • “[So,] I plead with you to do everything within your power to help us achieve [energy independence] by expediting the release of some of your abundant natural gas resources into the world market, especially to those nations beholden to a monopolistic supplier. ”
  • “The United States, with your enormous natural gas resources and highly developed infrastructure, has the kind of liquid market that Europe is trying mightily to achieve… [And,] the United States appears positioned to be a key player in the global LNG marketplace, but there is, as you know, a sticking point… The majority of your LNG exports are subject to a “public interest” review conducted by your Department of Energy.”
  • “The U.S. President has the authority to deem all of the pending applications… to be “in the public interest.” We hope that his administration will do just that… but, if they don’t act in a timely way, we urge Congress to step in and amend the law.”
  • Accelerating America’s entry into the global natural gas market is a win–win–win situation. America wins through job creation and expanded economic growth… Residential, commercial, and industrial gas users across Europe win by access to less expensive, clean-burning U.S. natural gas. And, [the NATO alliance] wins when monopolistic levers of influence [in Europe] are reduced or eliminated.”

House Energy & Power Subcommittee Hearing

Unlike the hearing in the morning, the House hearing focused on a particular legislative vehicle, H.R. 6, the Domestic Prosperity and Global Freedom Act, sponsored by Rep. Cory Gardner (R-CO) and 40 of his colleagues. Also, unlike the Senate hearing, the House subcommittee heard first from a top political official from DOE, Dr. Paula Gant, Deputy Assistant Secretary for Oil and Natural Gas. Although the hearing was webcast live, there is no archive to review. However, the written statements of the witnesses remain available: Click Here.

Ambassador Orbán’s best quotes included:

  • “We are in the middle of the largest security crisis that Europe has seen since the end of the Cold War. And energy dependence, especially that of Central Eastern Europe and Ukraine, is again on everybody’s mind.”
  • Whoever has the monopoly, calls the shots: higher prices afflict a very tangible cost on the dependent country’s economy and population, while stuffing the supplier’s coffers and allowing it to reap the economic rents to finance further political, economic or military actions.”
  • “The only way to limit the monopoly supplier’s ability to exact damage and sow discord through the deployment of the price weapon is to establish alternative supply routes. Once they are in place, the monopoly supplier can no longer use the price discrimination tool freely, as it needs to consider how its actions affect the viability and attractiveness of alternative supply channels.”
  • “What Central Eastern Europe and the E.U. in general needs right now is the additional volume of gas. The most viable option [is LNG]. Liberalizing US LNG exports would send a signal to market actors to kick-start the development of missing infrastructure (LNG terminals, interconnectors). These developments in turn would put an immediate downward pressure on gas prices in Central Eastern Europe well before a single American gas molecule reaches the shores of our region.”
  • “[B]y liberalizing LNG exports, by eliminating the legal and administrative obstacles to the free trading of this vital, domestically produced commodity, the United States would provide fast and long-lasting protection for its allies against the most important dangers of natural gas dependency.”
  • “I believe that doing away with these [LNG] export limitations would make economic sense even in better times. But there is nothing like a crisis to focus the mind. As representatives of a country that Central Europe has traditionally looked to for leadership, you know well that you do not always have the luxury of choosing the time to make some of the most necessary decisions. But with the post-Cold War settlement crumbling before our eyes, if there was ever a time for your leadership, it is now—and if there was ever an issue that would do as much good at as little cost, it is the issue at hand.”