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CLNG: EIA Gas Export Study Reveals Only Part of Economic Picture (USA)

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The Center for Liquefied Natural Gas (CLNG),  yesterday said that the Energy Information Administration’s (EIA) report on the effects of increased natural gas exports on domestic gas markets is only part of a larger picture of how LNG exports will impact the U.S. economy and does not account for increased economic activity, decreased U.S. trade deficit and increased job creation that it expects will be revealed in a forthcoming macroeconomic study.

In August 2011, the Department of Energy’s Office of Fossil Energy requested that the EIA prepare the report.

The Office of Fossil Energy has also requested a second study from a third party contractor, which will analyze the macroeconomic effects of increased natural gas exports. The third party study is expected to be released later in the first quarter of 2012.

The EIA study is just a part of the overall analysis on the economic effects of natural gas exports,” said Bill Cooper, president of the Center for Liquefied Natural Gas. “The third party report will provide a more complete economic picture by focusing on the broader macroeconomic effects, which we believe will be positive.

The EIA study’s predicted natural gas price increases do not account for increased economic activity, decreased U.S. trade deficit and increased job creation that we expect will be revealed in the forthcoming macroeconomic study on LNG exports. GDP growth, job creation and offsetting the U.S. trade deficit would be beneficial in neutralizing any potential price effects. For example, the LNG industry expects each new export project to create thousands of jobs in the natural gas sector and related industries.

With a 100 year supply of natural gas and more supplies being discovered in new resource areas, the United States is well positioned to meet both the domestic needs of our country and to provide clean burning natural gas to new markets. As the EIA study noted, the vast percentage of exports would be supplied by additional natural gas production. As history has taught us, the natural gas industry overwhelmingly responds to meet new markets, far beyond current-day predictions.

Markets should ultimately decide whether or not the U.S. should engage in natural gas exports in the future, which is consistent with the long-standing policy of the Department of Energy. America’s free trade policy allows for economic growth and job creation by encouraging exports for all kinds of products, including for energy,” said Cooper.

EIA’s report examines four possible export scenarios. These scenarios consider variables of either 6 Bcf/day or 12 Bcf/day of increased natural gas exports, increasing by 1 Bcf/day per year or 3 Bcf/day per year.

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USA: BOEMRE Awards USD 5.6 Million for Environmental Study of Hanna Shoal

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The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) announced it has signed a cooperative agreement with the University of Texas at Austin and a team of highly qualified and experienced Arctic researchers for a comprehensive study of the Hanna Shoal ecosystem in the Chukchi Sea off Alaska’s northwest coast. The study will be conducted from 2011-2016 and is expected to cost $5,645,168.

Ongoing studies have highlighted Hanna Shoal as an important biological ecosystem between the Chukchi Sea and Arctic Ocean waters. BOEMRE analysts and decision makers will use the information developed by this study in future National Environmental Policy Act analyses and decision-making regarding potential energy development in the Chukchi Sea.

Over the course of many years, we have devoted substantial resources to promote better understanding of the Arctic environment,” said BOEMRE Director Michael R. Bromwich. “This five-year study will greatly contribute to the body of knowledge regarding the biological diversity of the Hanna Shoal area and will provide additional valuable information about the ecosystem that supports marine life.”

The main objectives of the study are to identify and measure important physical and biological processes that contribute to the high concentration of marine life in the Hanna Shoal area. The study will document physical and oceanographic features, ice conditions, and information concerning local species. BOEMRE will integrate data gained from this study with other relevant Chukchi Sea studies to provide a more complete understanding of environmental considerations such as food web and contaminant bioaccumulations.

Dr. Kenneth H. Dunton, University of Texas at Austin, will serve as Principal Investigator. His team will include researchers from the Florida Institute of Technology, Old Dominion University, the University of Alaska Fairbanks, the University of Maryland, the University of Rhode Island​, and the Woods Hole Oceanographic Institution. BOEMRE will be involved in all phases of the study, including substantial input to the field research design and coordinating with other research efforts in the Chukchi Sea to ensure BOEMRE information needs are met. BOEMRE staff may also participate in field cruises, field data interpretations and analyses, and in writing articles that flow from research that will be conducted under this cooperative agreement.

Although BOEMRE developed the Hanna Shoal study parameters in 2010, the study will also address several issues raised by the U.S. Geological Survey June 2011 report, An Evaluation of the Science Needs to Inform Decisions on Outer Continental Shelf Energy Development in the Chukchi and Beaufort Seas, Alaska.

Since the early 1970s, BOEMRE and its predecessor organizations have funded more than $340 million in studies in Alaska. The Hannah Shoal study is one of approximately 40 ongoing studies the bureau’s Alaska Region is currently coordinating and managing. The bureau’s Environmental Studies Program conducts and oversees world-class, scientific research to inform policy decisions regarding leasing and development of OCS energy and mineral resources.

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