West Virginia-based natural gas group objects to Biden decision on LNG exports

Story by David Beard, The Dominion Post

MORGANTOWN, W.Va. — The Gas & Oil Association of West Virginia – GO-WV – has joined with two other regional gas and oil groups to object to and point out the likely negative consequences of President Biden’s decision to pause liquefied natural gas exports.

GO-WV, the Ohio Oil & Gas Association and the Marcellus Shale Coalition sent the letter to U.S. Energy Secretary Jennifer Granholm on Thursday. GO-WV notified The Dominion Post on Friday. Their thoughts echo the thoughts of Sens. Shelley Moore Capito and Joe Manchin and other lawmakers.

They began, “As the voices of Appalachia’s natural gas and oil industries and the workers contributing to our nation’s energy security, we are writing to express our deep concern with the ill-advised delay on reviewing and issuing new liquefied natural gas (LNG) export permits, and the consequences this will have on America’s global standing, environmental and clean air progress, and energy-related jobs across our region.”

Biden issued the pause on Jan, 26, saying in a White House fact sheet, climate change is the existential threat of our time – and we must act with the urgency it demands to protect the future for generations to come.

The pause affects exports to non-FTA (free trade agreement) countries until the Department of Energy can update the underlying analyses for authorizations, which the White House says are outdated and no longer adequately account for considerations like potential energy cost increases for American consumers and manufacturers beyond current authorizations or the latest assessment of the impact of greenhouse gas emissions.

“Today, we have an evolving understanding of the market need for LNG, the long-term supply of LNG, and the perilous impacts of methane on our planet,” it says. The U.S. is the world’s top LNG exporter and “today’s announcement will not impact our ability to continue supplying LNG to our allies in the near-term.”

The Thursday letter points out that Appalachia provides a third of the world’s natural gas supply and its production is fundamental to the long-term stability of energy markets.

Since 2009, when the shale revolution began, they wrote, gas prices have dropped in half and domestic natural gas prices have remained affordable, “and well below the high fluctuating price environment we experienced before the shale revolution.”

While Biden bases his pause on environmental concerns, the groups point out that natural gas produced in Appalachia has the lowest methane intensity of any other major producing region and is directly responsible for the significant drop in U.S. criteria emissions over the past decade. “As a result, our air is cleaner today than at any point since the dawn of the industrial revolution, and millions of Americans with respiratory challenges are benefiting each and every day.”

Appalachia’s greenhouse gas emissions are 22% lower than in 2018, they wrote.

In 2022, Appalachia’s overall greenhouse gas emissions intensity dropped 22% compared to 2018. Specific to methane, the basin’s intensity is 0.09% after reducing its already nation-leading low intensity by a considerable 11% in 2021, Clean Air Task Force and Ceres data shows.

“Reducing our nation’s ability to supply foreign markets,” they wrote, “does not reduce the demand; it simply forces our allies to rely on Russian natural gas that carries a 65% higher methane intensity than that from the U.S. That’s bad for our economy, bad for our national security, and bad for the environment.”

They highlight the economic benefits of shale gas production. “The industry supports hundreds of thousands of workers in Ohio, Pennsylvania and West Virginia with quality, family-sustaining careers and has induced significant economic activity across our three states through direct investment and significant royalty and tax payments.”

Biden’s move, they wrote effectively turns America’s back on its allies. “This dangerous political pandering undermines our work and will have dire long-term consequences for Americans and our allies across the world. We urge you to reverse this misguided decision.”

Lawmaker comments

On Thursday, Capito, ranking member of the Environment and Public Works Committee, joined with Sen. John Barasso, R-Wyo. and ranking member of the Energy Committee, and other GOP leaders to comment on Biden’s move.

She called the move “absolutely a political strategy move to try to attract more young environmental voters after some of the decisions that he’s made, and to me, do we really want to stake our national security and our international reliability and security on such a flimsy and I think, unfounded decision?”

Russia and Iran are the number two and three natural gas producers, she said. “So with West Virginia, Pennsylvania and Ohio, what does this do? It shuts down workers, shuts down families being able to stay in their communities, feed their families, and provide for the national security by being the energy independent country that we know they are.”

Biden, she said, “is choosing Putin over Pennsylvania. He’s choosing the Ayatollah over Appalachia. And he is also choosing the Kremlin over the Kanawha in West Virginia. And he’s choosing Moscow over the Marcellus Shale. It’s clear in his decision. It’s a political decision that harms not just us, but greatly harms our allies.”

Manchin, Energy Committee chair, held a hearing on the topic on Thursday. He highlighted the ramping up of U.S. energy production and LNG exports. ”A lot has changed in a few years and there are sensible reasons to update the market assessments that DOE uses when reviewing export applications to ensure the trajectory we’re on won’t risk harming American families and businesses. But these types of decisions should be firmly based on facts, not politics.”

The administration has done no market assessments yet, just cited some arbitrary data points. “The White House has gone out of its way to signal that the pause is a political ploy intended to get votes in an election year—it’s all about politics, not economics.”

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