APGA filed a motion to intervene and protest in response to the application by Cheniere Marketing, LLC to export approximately 2.1 billion cubic feet per day (Bcf/day) of LNG from the proposed Corpus Christi Liquefaction Project to any country that the United States does not have a Free Trade Agreement (FTA) with.
To date, 20 applications have been filed at the Department of Energy (DOE) to export 28.67 Bcf/day of LNG to FTA countries. This equates to approximately 45 percent of our daily consumption. APGA members unanimously approved a resolution to oppose the export of LNG at the 2011 APGA Annual Conference.
In its filing APGA states that “proposed exports from Corpus Christi, Texas will increase domestic natural gas prices, burdening households and jeopardizing potential growth in the manufacturing sector, as well as the transition away from more environmentally damaging fossil fuels.” APGA’s comments also respond to a recently released DOE commissioned study on the macroeconomic impacts of LNG exports from the United States. Specifically, the comments state that although the study communicated that LNG exports will result in net economic benefits.
It also concluded that the higher the volume of LNG exports, the more domestic natural gas prices will rise. APGA’s filing concludes that “Cheniere’s proposal to export domestic LNG to non-FTA nations is inconsistent with the public interest because it will increase domestic natural gas and electricity prices to the detriment of all consumers, inhibit this nation’s ability to forge a path toward energy independence, and undermine sustained economic growth in key manufacturing sectors.”
Golden Pass Products said it has received authorization from the United States Department of Energy to export domestically produced natural gas as liquefied natural gas from the Golden Pass LNG terminal in Sabine Pass, Texas, to nations that have existing Free Trade Agreements (FTA) with the U.S.
The proposed project involves construction of natural gas liquefaction and export capabilities at the existing Golden Pass LNG facility. If developed, the project would represent approximately $10 billion of investment on the U.S. Gulf Coast, generating billions of dollars of economic growth at local, state and national levels and millions of dollars in taxes to local, state and federal governments. The project would generate approximately 9,000 construction jobs over five years with peak construction employment reaching about 3,000 jobs.
The proposed project would have the capacity to send out approximately 15.6 million tons of LNG per year. New infrastructure required to export will be located on the existing property, which contains two berths for LNG tankers, five storage tanks and access to the Golden Pass pipeline. The expanded facility would then have the capability and flexibility to both import and export natural gas.
As noted in the FTA application, Golden Pass also plans to submit an application to export LNG to non-FTA nations. A final investment decision will be made following government and regulatory approvals and will be based on a range of factors.
Main Pass Energy Hub filed an application with the U.S. DOE for a long-term, multi-contract authorization to export up to 24 million metric tons per annum (MTPA) of domestically produced LNG.
The company seeks this authorization for a 30-year period commencing on the earlier of the date of first export or eight years from the date the requested authorization is granted.
The company seeks authorization to export domestically-produced LNG from existing and new facilities that it intends to modify, build, and operate, located in Federal waters in Main Pass Block 299, 16 miles offshore of Louisiana (MPEH™ Deepwater Port) to any country with which the U.S. has, or in the future may have, a Free Trade Agreement (FTA).
- Corpus Christi, TX: Cheniere files permits to build terminal, export LNG (appliedagrotech.net)
- Pro-LNG Export Group Urges Chu to “Think A Little Differently” (mb50.wordpress.com)
Wednesday, April 13, 2011
In recent weeks developments have taken place that show a new United States interest in furthering liberalization of trade relations with hemispheric countries. Specifically, the United States has come to the point of finally resolving difficulties which it had with Colombia, and after much hesitation, the US Congress will have been persuaded by the Obama administration to sign an amended US-Colombia Trade Promotion Agreement originally negotiated in 2006. There are signs too, that the President has succeeded in removing opposition to an FTA with Panama. And that he now seems close to having persuaded various opposition entitites, including members of his Democratic Party and the leadership of the state of Arizona, that an agreement to permit Mexican truckers to transmit goods across the US-Mexican border, in accordance with the NAFTA, should be implemented.
In some measure this reflects a resumption of a pattern of negotiating free trade systems on a bilateral rather than on the wider regional basis, first promised by President George HW Bush in his Enterprise for the Americas Initiative, and then consolidated by President Bill Clinton when he announced the Free Trade Area of the Americas at the Summit of the Americas held in Mexico in December 1994. With the persistent postponement of the conclusion of FTAA negotiations, the US pursued the bilateral path, of particular interest to us when the Central American States and the Dominican Republic, signatories with Caricom to the Caribbean Basin Initiative, signed a separate Free Trade Area agreement with the United States during President George W Bush’s tenure of office.
That US-DR-CAFTA agreement of 2004 itself signalled a recognition by some of the smaller countries of the hemisphere that the FTAA was now definitively out the question, this having been finalised following an American initiative to further temporarily consolidate the CBI as far as Caricom was concerned, through the Caribbean Basin Trade Partnership Act (May 2000). The United States saw this CBPTA as a kind of stage on the road to a full free trade agreement, for which we have now ourselves been in the process of preparing.
The speed with which that US-DR-CAFTA agreement was formalised by the Central American states – not without domestic difficulty on the part of some of them including the most democratic, Costa Rica – has given something of a jolt to us in Caricom, particularly after our Cariforum partner, the Dominican Republic was enjoined to it. Very visibly, the DR, demonstrating much the same diplomatic agility that it had shown in ensuring membership of the EU-CARIFORUM system, hastened to induce the United States to accept itself as part of the CAFTA initiative. This showed a capacity to influence the United States in a positive direction, and with a speed which we had not been able to demonstrate in pursuing a separate FTA with the United States.
Various reasons are being given for this new movement in hemispheric trade relations. It is suggested that the United States has been becoming more concerned with the increasing openness of Latin American states to initiatives from outside the area, with Brazil in particular moving to pursue what it considers to be a balanced global liberalization process at the level of the WTO, rather than specifically with the United States. This reflects a wider administration concern that Congressional resistance is damaging US trade and investment interests worldwide, as indicated now in the possibility that Congress will also have been persuaded to approve an FTA with South Korea signed some time ago. Brazil’s success, along with some African countries, in arriving at decisions in their favour at the WTO level on sugar and cotton, and the more recent interest of countries like China in doing bilateral commodity deals with Brazil, have certainly indicated to the US that a confident Brazilian government is no long willing to wait on the deliberations of a tortuous US government-Congress-trade lobby system to deliver acceptable results.
Some indications of a US concern with the possible wider negative effects for its trade and investment position of the intervention of China in the hemisphere have also been in evidence. It is suggested that not only the initiatives of China towards Brazil, but recent suggestions of a Chinese proposal to construct what is referred to as an “alternative dry canal” in Colombia across the Panama isthmus, have jolted recalcitrant Republicans in the Congress towards approving the trade agreement with Colombia. As a Texas Republican Congressman Kevin Brady recently remarked, “China is taking smart advantage of America’s inexcusable delay of nearly five years in approving its free trade agreement with Colombia.”
For us in the Caribbean, these developments suggest the urgency of taking advantage of this new atmosphere, and of finalizing without too much further delay FTAs with both the United States and Canada. We can hardly be satisfied to find ourselves circumscribed by a set of arrangements between the North American giants and the neigbouring countries and sub-regions surrounding us. As a recent editorial in the London Financial Times has observed, in response to both hemispheric and global trading rearrangements, the United States is beginning to “shake off its torpor on trade” negotiations, recognizing that “though partial deals remain a poor substitute for multilateral processes, they are the only game in town.” As the American elections approach, both the President and Congressmen will be anxious to show themselves as positioning the United States favourably in the emerging global economic patterns, and this preoccupation will obviously take precedence over minor sub-regions such as our own.
Caricom will be aware too that immediately around us, geopolitical, and consequently economic relations, are being steadily reorganized. Too much hesitation on our part will certainly be felt by the US and Canada to be a function of our dilatoriness, rather than their own resistance, as they will certainly take the US-DR-CAFTA as their point of reference. They will incline to a Dominican Republic view of the reasons for long delays on our part in finalizing various kinds of negotiations and decisions. In addition, it would appear to be the case that, in spite of the sometimes confusing behaviour in regional relations of President Chávez, there is an improvement in relations between Venezuela and Colombia with the emergence of President Santos in the latter country. It is argued that Colombia is concerned to negotiate a new trade agreement with Venezuela, complicated as this will undoubtedly be, following a decline in trade since 2007 from US$7 billion to US$1.2 billion presently, much of the decline to the disadvantage of Colombia. Colombia is also anxious to conclude an agreement before Venezuela is scheduled to withdraw from the Andean Pact towards the end of this month, to join Mercosur.
All these are signs to us that the old Latin phrase, festina lente – hasten slowly – may not be good advice to us in this present era, as far as joining in emerging hemispheric trade relationships is concerned.