WASHINGTON – The Arkansas delegation is supporting calls for a boost in natural gas exports as part of a national response to Russia’s military incursion into Ukraine.
“From the standpoint of statecraft, I think that is a reasonable suggestion to be made,” said Rep. Steve Womack, R-Rogers.
The Obama administration and some members of Congress are considering how to leverage the nation’s abundant natural gas supply to weaken the influence Russia now has as an energy supplier to Europe.
The House Foreign Affairs Committee debated the issue Thursday as it drafted a non-binding resolution condemning Russia’s recent action and calling on the Obama administration to enact financial and trade sanctions against Russia.
Rep. Ted Poe, R-Texas, sought to strengthen language in the resolution to advocate expansion of U.S. natural gas exports. Poe said that Congress needed to send a clear message to Russian President Vladimir Putin that the U.S. would not stand by and allow him to use natural gas as an “economic weapon” against Ukraine, former Soviet satellites or Western Europe.
“This would help Ukraine and help us as well,” Poe said. “There is a demand and we have an overwhelming supply. We have more natural gas than we can use.”
The committee did not adopt Poe’s amendment fearing that it could divide Congress over environmental concerns related to shale. Instead, they settled on language that would encourage Ukraine and Europe to develop alternative sources of energy – and preserve strong bipartisan support for the resolution.
Rep. Tom Cotton, R-Dardanelle, who sits on the committee did not participate in the debate but offered that he favored Poe’s language encouraging natural gas exports.
“In light of the current situation in Ukraine, it is particularly important for the administration to streamline the approval process for new LNG export facilities. A global market for our growing production of LNG would reduce not only Ukraine’s dependence on Russia, but also reduce the role Russia plays in supplying energy to our European allies,” Cotton said.
Rep. Tim Griffin, R-Little Rock, issued a statement Thursday urging Obama to order his Energy Department to approve stalled applications for American oil and natural gas projects to “help Ukraine and weaken Putin’s sway over the region.”
Russia supplies Ukraine nearly two-thirds of its natural gas and about a third of all the natural gas that goes to Europe. The United States has not been a major exporter of natural gas but has a vast reserve and producers now interested in foreign markets.
U.S. natural gas production increased 25 percent from 2007 to 2013, and with the emergence of the Marcellus shale formation in the northeast is now expected to become a major exporter over the next few years, according to a recent report by Morningstar Inc.
The U.S. could begin exporting liquefied natural gas next year from an approved liquefied natural gas facility and there are at least five others with conditional approval that could begin shipping after that.
In Arkansas, Fayetteville shale remains an important component of the US natural gas supply and production could grow if prices recover, according to Hanwean Chang, a senior analyst at IHS, a global information company.
Griffin said that only six permits have been issued in the last three years for LNG facilities. Another 24 applications are awaiting action.
“If the president wanted to strengthen his hand, and help protect our allies in the region, he’d pick up his phone and use his pen and have the Energy Department approve the applications for these LNG exports.”
Legislation has also been introduced in the House and Senate to expand the ability of energy firms to export liquefied natural gas to more countries around the world without the need for lengthy approval process now required.
Poe introduced the bill in the House and Sen. Mark Udall, D-Colo., has a similar bill in the Senate.
“The ongoing crisis in Ukraine — and Russia’s threat to use its natural gas exports as a cudgel there — shows why we need to responsibly develop our natural gas reserves and expand our ability to export this resource abroad,” Udall said in announcing this bill.
Sen. John Boozman, R-Ark., said that expansion of natural gas exports is something that should be considered. But he expressed some fear that it could lead to a spike in domestic prices that would hurt individuals and businesses that rely on natural gas.