* Law automatically allows exports to free trade countries
* Wyden says policy could harm U.S. manufacturers
* Pacific trade deal could expand U.S. export markets
By Ayesha Rascoe and Roberta Rampton
WASHINGTON, Nov 1 The United States needs to
reconsider its rules on exporting natural gas - even to
countries with which it has free trade agreements - now that a
surge in drilling has made the nation one of the world's
fastest-growing producers, U.S. Senator Ron Wyden said on
Advanced drilling techniques have allowed energy companies
to tap vast shale gas reserves, opening the door to U.S. exports
after years of projections that the United States would have to
rely on foreign gas to meet its energy needs.
The government should rethink a decades-old law that
automatically allows companies to send U.S. natural gas to the
country's free trade partners, argued Wyden, who is in line to
be the top Democrat on the Senate energy committee next year.
"This policy needs reconsideration," Wyden said in a
statement. "It could harm the nation's ability to achieve energy
independence, combat pollution and preserve the environment, and
improve the economic competitiveness of American manufacturers."
Wyden has repeatedly raised concerns about natural gas
exports, saying the government must assess whether sending gas
abroad will raise prices on consumers and industries.
Wyden's comments come as the United States engages in
negotiations with nearly a dozen countries to forge an
Asia-Pacific trade deal.
Companies have been pushing for the Energy Department to
expand exports to other countries, because the nations that
currently have free trade agreements with the United States
would not provide enough demand to support multibillion dollar
investments in liquefied natural gas export terminals.
The department approved exports from Cheniere's
Sabine Pass terminal in Louisiana, but has held off on approving
any more pending a study of the effects of exports.
The Trans-Pacific Partnership could dramatically change the
prospects for automatic exports, however, with Japan expressing
interest in joining the talks.
Japan is one of the world's top LNG consumers, and counts on
LNG imports for almost half of its energy requirements after it
took its nuclear reactors offline following the Fukushima
Its LNG prices are about five times U.S. prices, and the
Japanese government has said it would like to see more imports
from the United States.
"Any final agreement on a Trans-Pacific Partnership must not
constrain the U.S. from reshaping its energy policy, which may
include new treatment of natural gas exports," Wyden said.
The 11 countries participating in the Trans-Pacific talks
will hold their 14th round of negotiations in December, with
Canada and Mexico participating for the first time.
A final deal in the talks could still be one year or longer
away, with many tough issues left to resolve.