U.S. Poised to Become Liquefied Natural Gas Exporter

New technologies have increased the nation’s domestic production supplies and reduced the need for overseas liquefied natural gas (LNG) and imports from Canada.  In fact, by 2016, the Energy Information Administration (EIA) projects that the U.S. will be a net exporter of LNG, and Energy Solutions, Inc., agrees. 

Valerie Wood, President of Energy Solutions, Inc., explains the key component of making this prediction a reality.  “Ongoing growth in shale supplies has virtually replaced the need for LNG imports.  The EIA projects that LNG imports will continue to decline as the U.S is now able to rely on low-cost domestically produced natural gas supplies.”  As companies have come to grips with the changing environment, they are looking to make some changes. 

Some are requesting authority to convert existing LNG import facilities to export facilities. Others are seeking authority to make their current facility bidirectional, thus allowing it to accept LNG imports or to initiate LNG exports.  Many of these authorizations require additional construction, and that is one reason the capability to export LNG from the U.S. to other foreign countries doesn’t become a reality until around 2016. 

To date, nine companies have sought federal approval to export about 10 Bcf/day of LNG.  As a nation, the transition from being a net LNG importer to a net LNG exporter has fueled the debate on what this will do to natural gas prices.  Producers are excited about the ability to compete globally, allowing them to export natural gas to Asian and European markets that are willing to pay much higher prices, ranging from $12 per MMBtu to $18 per MMBtu.   

Conversely, end-user buyers recognize that exporting only creates increased competition that will more than likely increase domestic natural gas prices.  Others argue that exports will increase the gross domestic product (GDP) and create additional jobs, two benefits that are good for the nation’s economic health. 

To learn more about developments within the field of liquefied natural gas imports and exports, obtain a copy of Natural Gas Price Outlook, which was published on February 13, 2012.  This 59-page, comprehensive analysis evaluates numerous price drivers and is a must-read for those who want answers to what the future holds for natural gas prices.  To learn more and secure your copy, visit http://www.naturalgasoutlook.com. 

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About Energy Solutions, Inc.
Formed in 1996, Energy Solutions, Inc. is independently owned. With more than 50 years of experience in the natural gas industry, our team focuses on natural gas prices and in helping businesses improve their internal processes for the purchase of natural gas.