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The Biden administration will issue a study on the economic and environmental effects of liquefied natural gas exports later this month, Reuters has reported, citing an official from the Department of Energy.
The study follows the “pause” that President Biden issued on new LNG export facility approvals in January this year, following a pressure campaign from climate activists citing a study claiming that LNG exports are more harmful for the climate than burning coal.
“We expect to release the final study … by mid-December for a 60-day public comment period,” Brad Crabtree, assistant secretary at the DoE, told Reuters. He added, commenting on the approval pause, that it only affected seven projects with a combined capacity of 5.6 billion cu m, but since the start of the Biden administration, the DoE had approved projects with a combined capacity of 48 billion cu m.
“There is so much project development going on on the Gulf Coast that they can’t keep up” the official said. “They are struggling to find workers.”
The surge in project development may be one reason for the cost inflation LNG developers are facing, as noted in a report from LNG analysts at Poten & Partners this week. The report mentioned Venture Global’s Plaquemines LNG project, which is $2.3 billion over budget and the Golden Pass LNG, a joint venture between Exxon and QatarEnergy, which is about $2 billion over budget.
“We’ve got a lot of gas in the U.S., but we don’t really have vast amounts of really cheap gas,” the Poten & Partners analysts said, noting rising demand for LNG abroad and more electricity at home could push U.S. natural gas prices to $6 per million cu ft.
President-elect Donald Trump plans to axe the pause on LNG export project approvals on his first day in office.
