Moody's: Modest amount of controversial natural gas exports will get approval
Zack Colman - 05/01/13 12:05 PM ET
The Obama administration will likely approve a limited number of politically controversial natural gas export projects despite some fears on Capitol Hill about a massive expansion, according to a Moody's report released Wednesday.
It said the Energy Department (DOE) would likely approve three out of the 20 applications under review for exporting natural gas to nations that lack a free-trade agreement with the United States. One such application already has received the go-ahead from the DOE.
Those projects have alarmed some lawmakers, who are tussling over whether to allow a major expansion of natural gas exports.
The DOE must determine deals to non-free trade countries are in the national interest under federal law, meaning they must clear a more stringent standard than contracts with free-trade nations.
Given the process at the DOE and the time it takes to build export facilities, Moody's said the United States won't be a major player in the international market until 2020.
Republicans and some Democrats want to send more natural gas to non-free trade nations, arguing doing so would add jobs and generate revenues. But several Democrats worry that too rapid an increase would drive domestic energy prices upward.
The report comes as House lawmakers are preparing to dive into the geopolitical implications of exporting natural gas. The Senate Energy and Natural Resources Committee will also hold a series of natural gas “roundtables” this month, one of which will focus on exports.
A bulk of the liquefied natural gas shipped from the United States will likely head to Asia and will help other nations secure lower-cost contracts, Moody's said.
While the United States doesn’t figure to become a player in the global natural gas trade until the next decade, its expected emergence already is having an impact, the