WASHINGTON, March 7 (Reuters) - An update of a pivotal report on U.S. liquefied natural gas exports released on Friday found that allowing unlimited shipments of gas abroad would benefit the U.S. economy, mirroring the findings of the initial study.
Using fresh data, NERA Economic Consulting concluded again that gas exports would increase real household income and gross domestic product in the United States, despite raising natural gas prices.
The study looked at an increase in wages and returns on investment in the natural gas industry, as well as other macroeconomic indicators, and said this would offset higher domestic energy prices.
The original NERA report, released in late 2012, was commissioned by the U.S. Department of Energy and has been used by the agency to support the granting of five conditional licenses for U.S. LNG exports over the past 10 months.
Scrutiny of U.S. gas export policy has intensified in recent days. Some lawmakers have called on the Obama administration to speed up its review process for allowing the sale of gas to non-free trade agreement countries in response to the crisis in Ukraine, or to just approve pending applications en masse.
But a manufacturers’ group, led by Dow Chemical, has warned that allowing too much U.S. gas to be sent overseas could harm fuel intensive industries by causing price spikes.
Commissioned by Cheniere Energy Inc, the report from NERA offered a more detailed analysis of the impact that exports would have on the chemical sector.
“Our analysis suggests that there is no support for the concern that LNG exports, even in the unlimited export case, will obstruct a chemicals or manufacturing renaissance in the United States,” the report said.
In all scenarios considered by NERA, the report found “slightly slower” but still “robust” growth rates of about 2 percent for chemical companies using natural gas between 2018 and 2038.
After facing criticism that it used outdated data in the 2012 report, NERA based its latest analysis on the Energy Information Administration’s 2013 editions of the Annual Energy Outlook and the International Energy Outlook.
Cheniere, the NERA report sponsor, was the first company to receive permission from the Obama administration to export LNG, in 2011. The company currently has several other projects seeking export approval.