The Energy Edge: Department of Energy Set to Boost LNG Exports by Authorizing Four New Export Projects in Texas

U.S. exports of liquefied natural gas (LNG) have risen steadily over the past few years, and the Department of Energy (DOE) is taking steps to ensure that growth continues well into the future.

Last week, the DOE authorized the export of domestically produced LNG from four proposed LNG export projects in Texas – Annova LNG, Rio Grande LNG, and Texas LNG in Brownsville, TX; and Corpus Christi LNG’s Stage III in in Corpus Christi.

In the announcement, DOE says these entities have authorization to export LNG “by ocean-going vessel to any country with which the U.S. does not have a free trade agreement requiring national treatment for trade in natural gas, and with which trade is not prohibited by U.S. law or policy.” The Federal Energy Regulatory Commission (FERC) authorized the siting, construction, and operation of these export projects back in November of 2019.

Right now, the U.S. is in the midst of its fourth straight year as a net exporter of natural gas and is now among the top global exporters of LNG. As of last year, the U.S. has exported LNG to 37 countries around the world, and some predict the industry will nearly double its export capacity by 2025. President Trump himself spent time in India this week pushing the U.S.’s significant supply of LNG. These energy-hungry markets need to secure energy from someplace, and the United States is in the fortunate position of being a global energy production powerhouse at a time when the natural gas industry is innovating through a challenging price environment.

Exporting More than Energy

We recently shared insights on an International Energy Agency (IEA) report that showed the U.S. was the global leader in emissions reductions in 2019 and played a significant role in global emissions remaining flat in 2019 after two consecutive years of increases. Much of this decrease was due to increased usage of natural gas in advanced economies, nuclear and solar.

By further enabling the growth and usage of LNG beyond its borders, it’s possible the U.S. will be exporting more than just a valuable energy resource. It will be actively exporting emissions reductions as well.

The Edge: Challenges Still Remain in Exporting These “Molecules of Freedom”

The domestic benefits of LNG production have been well marked – energy security, cost savings, emissions reductions, infrastructure development, and job creation. The White House has referred to this as “molecules of freedom.” The next logical step to continuing the growth of the natural gas industry is to expand its customer base beyond the U.S.’s immediate neighbors to the north and south. If the U.S. wants to be the global leader in energy and emissions reductions, exporting LNG worldwide is a smart way to get there. However, challenges still remain. The low-price environment and commoditization of LNG is making it more difficult to sign long-term deals with foreign buyers. It will be on lawmakers and producers to come together and ensure U.S. LNG supplies remain stable and financially attractive to fend off increasing competition from other sellers.