Senate Committee Approves Ukraine Bill

The Senate Foreign Relations Committee took up the bill this afternoon to provide urgent assistance to Ukraine and reported it by a vote of 14-3.

During the markup, Sen. John Barrosso (R-WY) did in fact offer his amendment to expedite LNG exports to Ukraine and NATO countries. However, committee chair Sen. Robert Menendez (D-NJ) ruled the amendment out of order and tabled it, saying that it was not within “the committee’s jurisdiction.”

After Sen. Barrosso explained his amendment, Sen. Barbara Boxer (D-CA) spoke against it saying it would raise U.S. electricity “prices by 36 percent.”

Boxer was followed by Sen. Richard Durbin (D-IL), the Senate Majority Whip, who articulated a more nuanced position: “Sen. Barrasso raises a legitimate and important issue. We know that Ukraine, Georgia, the Baltics, the former Warsaw Pact countries, and former Soviet republics are all subject to extortion by Russia over the availability and cost of natural gas. I think we need to address this, and I won’t rule out the possibility of that. But some of the questions that have been raised here—and not just the environmental questions and the cost of utilities here in our country, but also a resurgence of manufacturing jobs because of the low cost of natural gas—are important questions. I think it’s incumbent upon us to ask the tough questions, such as what will be the cost to the American economy? How many jobs could we lose in the manufacturing sector if the cost of gas goes up? This really needs to be brought to several committees to make sure we have a thoughtful approach.”

Sen. Tom Udall (D-NM) spoke next and said, “The thrust of [this amendment is good] and I’m sympathetic to it. I believe that the export of LNG is something we should be doing as a country and we somehow have to shake up the DOE process because it is going too slowly. I note that my cousin (Sen. Mark Udall) has introduced a bill to expedite approval of exports to all WTO countries, and I support his effort. The volume of our exports will be determined by the price of gas and the cost of facilities. The gas will likely to go where there is the most need… and there is a strong interest in Eastern Europe, given Russia’s aggressive economic behavior. The world is hungry for U.S. natural gas. I’d like to work with you, but I think this amendment could derail this important bill.”

Sen. Edward Markey (D-MA) also spoke against the amendment, saying: “We need a time-out on this issue. We don’t know enough to make an informed judgment in this committee on an issue which is fundamental to U.S. economic security. And, I think the more people understand this issue the more reluctant they’re going to become in exporting our most valuable resource—our oil and our natural gas. We’re not in surplus. We still import natural gas and oil and we shouldn’t be exporting these resources overseas… Last year, natural gas prices went up 27 percent and there was a shift back to coal and our greenhouse gases went back up again. We should talk about all of this… [especially] the impact on the manufacturing industry, upon the utility industry, and on consumers as well. And, this is a highly volatile fuel that would have almost ‘nuclear bomb’ like impact if there was a terrorist attack while it was being transported. And, let me just say that this gas will go to Asia and not to Europe.”

Sen. Barrosso issued a news release after the committee’s action. The release quotes him as saying: “Mr. Chairman, I recognize that you have the power to make certain rulings in this committee, and obviously I disagree with your conclusion that this amendment shouldn’t be considered today.

“I’d say by passing my amendment, the United States has the potential to be the strategic energy supplier to our NATO allies and the Ukraine.

“It’s worth noting Mr. Chairman that my amendment on LNG exports has strong bipartisan support in the body.

“I will of course be offering this amendment in the full Senate. I expect our bipartisan coalition to pass an amendment that actually helps Ukraine and Eastern Europe escape the grip of Russia. I will be offering this amendment of the floor, and I’ll push for a vote.

“And I look forward to traveling to the Ukraine tomorrow, and directly speaking with leaders in the region about their desire to buy American natural gas to escape Russian’s grip on their economy and future.”

Correction: House Ukraine Assistance and LNG

In the morning report we stated that the House-passed Ukraine assistance bill did not include an LNG provision. We were referring to H. R. 4152 the substantive loan guarantee bill. The House also passed a non-binding resolution (H. Res. 499) yesterday that included the following symbolic statement: “Resolved, That the House of Representatives… calls on Ukraine and European countries and former Soviet Republics to support energy diversification initiatives to reduce Russian control of energy exports, including by promoting energy efficiency and reverse natural gas flows from Western Europe, and calls on the United States to promote increased natural gas exports and energy efficiency. ”