US LNG exports could help boost allies abroad-former DOE heads

Fri Jan 11, 2013 6:39pm EST

Related Topics

* Gas exports offer geo-political benefits-former secretaries

* LNG exports could help reduce reliance on Russia, Iran

* Energy exports should not be used as "political tool"-Abraham

By Ayesha Rascoe

WASHINGTON, Jan 11 (Reuters) - The United States can help its allies by selling part of its abundant gas reserves abroad, and do so without sacrificing the resurgent manufacturing sector, two former U.S. energy secretaries said on Friday.

The availability of U.S. liquefied natural gas could allow countries in Europe and Asia to be more selective about their energy providers, the former officials told Reuters.

"It's not a trade off," said Bill Richardson, who headed the U.S. Energy Department during the Clinton administration. "What we are offering the international community and our friends by exporting natural gas is a form of energy security."

Technological innovations have dramatically increased U.S. natural gas output, putting the country on the path to potentially be a net exporter of gas after years of fears that the nation would have to rely on foreign sources to meet its energy needs.

But tensions over gas exports are growing as critics voice concerns that the United States could be trading away the low energy prices that have fueled a rebound by the long-struggling manufacturing sector.

Richardson and Spencer Abraham, who served as energy secretary during the second Bush administration, have joined forces to throw their support behind LNG exports. In December the pair penned an op-ed in the Financial Times in backing exports.

They argue that the United States could diversify the market for natural gas in places like western Europe, where Russia has used natural gas exports for political leverage.

U.S. exports could also help countries move away from imports of Iranian natural gas. The European Union issued measures last month banning Iranian gas imports, as part of an effort to get the country to scale back its nuclear program.

These "positive" developments have "to be factored into any calculus that's made as to the benefits of exporting natural gas," Abraham said.

Natural gas exports to all but a handful of countries with free trade agreements require authorization from the Energy Department. The department is currently weighing 16 applications sell the natural gas to foreign countries.

The debate over how to manage the nation's natural gas bounty is ramping up, with a group of energy intensive companies launching a campaign on Thursday to promote domestic use of natural gas.

Abraham and Richardson disputed the notion that permitting natural gas exports would hurt manufacturers, pointing to a government-sponsored report issued late last year that found exports would have only a modest impact on prices.

Some export skeptics have also argued the United States should extract some concessions from countries before allowing exports to non-free trade agreement nations, but Abraham said the United States "should not go down that road."

"We've always been the good guys," Abraham said. "We've stood for free trade, not using energy exports as political tool. That's the high ground."

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