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calcasieu pass 2
Fossil Fuel Speculators—Not Consumers—Would Win Big From LNG Exports: Report
"The expansion of U.S. LNG export capacity simply empowers Big Oil giants and commodity traders' ability to earn eye-popping profits," noted one expert.
Jan 24, 2024
Belying Big Oil's claims that vastly expanded U.S. liquefied natural gas exports benefit consumers, a report published Wednesday revealed that fossil fuel speculators and commodity traders would be the main beneficiaries from eight proposed LNG projects, while American consumers and the climate would suffer higher prices and emissions.
The report—entitled Methane Madness—was published by Friends of the Earth, Bailout Watch, and Public Citizen and examines how the controversial Calcasieu Pass 2 (CP2) LNG export terminal in Louisiana and seven other proposed projects would harm U.S. consumers while fueling the climate emergency.
"Big Oil's talking points about European energy security are cynical and inaccurate," said Lukas Ross, climate and energy deputy director at Friends of the Earth.
The report found that:
- If built, the eight pending projects will produce the annual equivalent of 113 coal plants in planet-warming emissions;
- More than half of the volume from these pending facilities has been secured by commodity trading firms and Big Oil's speculative trading arms;
- Four of the five largest purchasers by volume from pending facilities are speculators;
- LNG from these facilities, if they are built, will be sold wherever these so-called "portfolio players" can turn the biggest profit—undercutting industry claims that the expansion is needed for European energy security; and
- The temporary surge in LNG exports to Europe since the outbreak of war in Ukraine is not translating into long-term demand.
"Record LNG exports drive up home heating prices for Americans, and line the pockets of fossil fuel CEOs, and these new planet-wrecking projects are not in the interest of the public," asserted Public Citizen energy researcher Alan Zibel.
"No amount of misleading energy industry lobbying can undo the simple reality that LNG exports force American consumers to pay more in the long run while U.S.-produced gas winds up in Beijing and Berlin," he added. "The expansion of U.S. LNG export capacity simply empowers Big Oil giants and commodity traders' ability to earn eye-popping profits."
The new report came as the Biden administration reportedly paused CP2's approval pending a Department of Energy review of the project's economic, national security, and climate impacts. While welcoming the news, climate campaigners argued that a pause is not enough.
"Now that they have paused, there is only one thing to do: Vow to reject CP2 and all 17 proposed LNG projects, and to phase out ALL fossil fuels," said 350.org U.S. campaign manager Candice Fortin. "Our frontline partners on the U.S. Gulf Coast have been fighting against oil and gas projects and for their homes and lives for decades. It is past time for the government to listen and stand up to the billionaires who are knowingly promoting toxic energy sources."
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With US in Deep Freeze, LNG Exports Blamed for Spike in Domestic Gas Prices
"Exports of LNG have created higher prices for U.S. consumers, leaving them vulnerable to massive price spikes like what happened this weekend," said one expert.
Jan 16, 2024
With millions of Americans suffering sub-zero temperatures under a deadly Arctic blast, a leading consumer advocate on Tuesday attributed the fivefold increase in the U.S. benchmark price of natural gas to the recent "explosion in LNG exports."
As the National Weather Service warns of continued near-record temperatures and wind chills affecting over 100 million people—mainly in the Midwest and Rocky Mountain regions and as far south as Texas—plunging mercury means soaring demand for fuel across much of the continental U.S.
This, in turn, sent liquefied natural gas prices skyward, with the spot price of gas from Henry Hub in Louisiana—the official delivery location for futures contracts on the New York Mercantile Exchange—soaring 400%, according to Bloomberg.
"The explosion in LNG exports since 2016 has resulted in a far more fragile and volatile balance between supply and demand."
But the consumer advocacy group Public Citizen says there's another explanation for sky-high LNG prices besides the deep freeze.
"The explosion in LNG exports since 2016 has resulted in a far more fragile and volatile balance between supply and demand," said Tyson Slocum, head of the group's energy program. "Exports of LNG have created higher prices for U.S. consumers, leaving them vulnerable to massive price spikes like what happened this weekend. U.S. gas demand hit a record high over the weekend, led by record exports."
Slocum added that the U.S. Energy Department "has failed to implement procedures restricting gas exports during extreme weather events, or proactively establish seasonal standards to curtail exports in advance of pending extreme weather events."
The Biden administration has presided over what climate campaigners have called a "staggering" LNG expansion, including Venture Global's Calcasieu Pass 2 export terminal in Cameron Parish, Louisiana and more than a dozen other projects that, if all completed, would make U.S. exported LNG emissions higher than all of Europe's combined greenhouse gas footprint, according to climate campaigner Bill McKibben.
McKibben and others have called on President Joe Biden to halt LNG exports.
"Nearly 90 years ago, Congress mandated that most natural gas could only be exported if the government first determined that doing so was 'consistent with the public interest,'" noted Slocum. "The Biden administration's Energy Department is in charge of enforcing this law, and has presided over unprecedented volumes of natural gas exports, exacerbating higher prices during winter storms."
"The Biden administration must follow the directive mandated by Congress and reassess its methodology for authorizing LNG exports, and establish proactive standards to curtail exports in the event of emergencies and seasonal demand surges," Slocum added.
Under mounting pressure to keep the president's promise to transition away from fossil fuels, the Biden administration is
reportedly considering a review of its LNG export approval process, with an eye toward whether it is properly accounting for their climate impacts.
While supporters of LNG claim it's one of the safest fossil fuels to produce and transport, critics point to the numerous explosions and fires at gas facilities in recent years, as well as the worsening climate emergency caused and exacerbated by fossil fuel extraction and use.
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