Natural gas companies aim to export excess

But several groups oppose the move

The Philadelphia InquirerSeptember 28, 2012 

PHILADELPHIA — The natural-gas industry is drowning in its own success.

Drilling companies are extracting so much natural gas from formations like Pennsylvania's Marcellus Shale that they want to export the fuel overseas, provoking opposition from some who say that American gas should stay at home.

At the Shale Gas Insight conference in Philadelphia last week, Jack Williams, president of XTO Energy, used the podium to promote the idea of exporting liquefied natural gas ships.

"Just as we do with exports of grain, cars, and other American products, by exporting LNG, we can create economic value that would not have existed otherwise," Williams told the audience.

XTO has a lot to gain from exports. It is a subsidiary of Exxon Mobil, the nation's largest producer of natural gas, the price of which has plummeted in the last few years because the shale-gas revolution is producing more gas than U.S. markets can absorb.

Exxon Mobil in August submitted an application to the Federal Energy Regulatory Commission to export liquefied natural gas from a terminal it co-owns in Sabine Pass, Texas. It's one of seven facilities nationwide seeking federal approval to export.

Producers embrace the idea of exporting natural gas, which would increase demand, boost prices and spur more production. Exports would mean more American jobs producing gas. The income would also improve America's balance of trade.

But proposals to build more LNG export terminals are controversial.

Some American chemical producers fear that shipping LNG to foreign consumers would make gas scarce here, just as the industry is undergoing a revival thanks to abundant supplies of natural gas, a principal raw material.

American Public Gas Association, the trade group for utilities like Philadelphia Gas Works, has said that exports would produce "predictable and disastrous" results for household consumers.

Environmental groups like the Sierra Club have opposed new export terminals because they would induce more drilling, causing more environmental impact.

Others appeal to patriotic sentiments to block exports. T. Boone Pickens, who wants to replace imports of crude oil from unfriendly nations, thinks it would be folly to export natural gas.

The Energy Department is studying the economic effects of expanding LNG exports, but Reuters reported last week that the Obama administration delayed the release of the report until after the election.

Last week, Williams said there was plenty of natural gas supply to meet domestic demand and to export.

"The question is, do we want those additional jobs?" said Williams. "The important thing is we can do it all. It's not an either-or."

Lexington Herald-Leader is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service