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Senate hears pleas for gas exports to Europe
March 26, 2014 - Ben Klein
WASHINGTON (AP) — Calls to begin U.S. natural gas exports to Europe to counter Russian influence across the continent grew louder Tuesday amid concerns that Russia will move deeper into Ukraine.
Lithuania's energy minister, Jaroslav Neverovic, pleaded in emotional terms for U.S. help, saying his country is "100 percent" dependent on Russia for natural gas and has to pay 30 percent higher prices for it than other countries in Europe.
"This is not just unfair, this is abuse," Neverovic told the Senate Energy and Natural Resources Committee.
Lawmakers from both parties used the hearing to urge the Obama administration to speed up natural gas exports as a hedge against the possibility that Russia could cut off its supply of gas to Ukraine and other countries.
Four Central European nations — Hungary, Poland, Slovakia and the Czech Republic — made formal requests for U.S. exports as Moscow moved to annex part of the Ukraine. Concerns about energy security threaten the region's residents on a daily basis, ambassadors to the four countries said in letters to House and Senate leaders.
Sen. Mary Landrieu, D-La., the Senate committee's new chairman, said U.S. exports of liquefied natural gas, or LNG, would be a "powerful geopolitical tool" to pressure Russian President Vladimir Putin to lower gas prices across Europe.
The U.S. does not export natural gas to Europe, although it does export some gas to Mexico, Canada and Japan.
"We all know real competition in real open markets drives efficiency and lowers prices for everyone," Landrieu said. "The last thing Putin and his cronies want is competition from the United States of America in the energy race. Tyrants and dictators throughout history have had many reasons to fear revolutions, and this U.S. energy revolution is one they should all keep their eyes on."
Landrieu's energy-producing state is home to several proposed terminals to export LNG, including the only project that has won final approval. The terminal at Sabine Pass, La., is scheduled to begin operations late next year. Other proposed terminals would not begin sending fuel overseas until 2017 at the earliest.
"It's about the signal that is sent, even if (the natural gas) can't get there" right away, said Sen. Lisa Murkowski of Alaska, the senior Republican on the energy panel.
Landrieu is among nine U.S. officials barred from entering Russia in retaliation for economic sanctions imposed by the Obama administration in response to Russia's annexation of the Ukrainian peninsula of Crimea. She called that "a badge of honor" and said it encouraged her to redouble efforts to increase U.S. energy production and exports, including LNG.
Ukraine is heavily dependent on Russian natural gas, and previous disputes between Ukraine and Russia have led to cuts in supply. Russian state gas company Gazprom has warned that it will stop the flow if Ukraine doesn't pay off a nearly $2 billion debt.
Landrieu, House Speaker John Boehner, R-Ohio, and other lawmakers have been urging the Obama administration to clear the way for more exports amid a U.S. natural gas boom driven by improved drilling techniques, including hydraulic fracturing.
The process, also known as fracking, involves pumping huge volumes of water, sand and chemicals underground to split open rocks to allow oil and gas to flow. Improved technology has allowed energy companies to gain access to huge stores of natural gas across the U.S. but also has raised widespread concerns that it could lead to groundwater contamination and even earthquakes.
Even before the crisis in Ukraine, energy companies were pushing the U.S. to act before Russia, Iran and other countries build pipelines and terminals to help meet growing energy demands in Asia and other parts of the world.
The Energy Department has moved to approve just seven of more than two dozen proposed LNG export terminals in the past two years, including a conditional approval announced Monday for a project in Oregon.
The White House has argued that Russia's dependence on gas revenues makes it unlikely that the country will cut off supplies to Europe.
Edward Chow, a senior fellow at the Center for Strategic and International Studies, said U.S. officials also should work with counterparts in Germany and other European nations to relax restrictions on fracking and other drilling techniques. Many European countries ban fracking, a luxury Chow said they can no longer afford.
"They should improve their own (energy) situation," before seeking U.S. help, he said.
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