WASHINGTON, May 15, 2013 – U.S. LNG exports could create tens of thousands of domestic jobs while having only minimal impacts on domestic U.S. natural gas prices, a new report for API by ICF International finds. The report also concludes that LNG exports would spur strong growth in U.S. GDP but that U.S. companies would face considerable competition for LNG sales abroad, with at least 63 international LNG export projects currently planned or under construction.
“Increasing LNG exports is clearly in our national interest and will help the U.S. reach the president’s goal to double U.S. exports,” API President and CEO Jack Gerard said. “The industry is ready to invest in American infrastructure to create jobs and produce more domestic energy as soon as the Department of Energy moves forward with the approval of LNG export applications. Timely approval of LNG exports is crucial if we want to be competitive with international projects rushing to be first to market.”
U.S. LNG Exports: Impacts on Energy Markets and the Economy studies the energy market and economic impacts of LNG export levels of up to 4 billion cubic feet per day (Bcfd), 8 Bcfd, and 16 Bcfd by 2035. Among the report’s findings:
- Average net job growth due to LNG exports is projected to range from 73,100 to 452,300 between 2016 and 2035. Manufacturing job gains average between 7,800 and 76,800 net jobs between 2016 and 2035, including 1,700 to 11,400 net chemical, petrochemical and refining job gains over the period.
- U.S. GDP growth is projected to be positive at about $15.6 to $73.6 billion annually between 2016 and 2035, depending on LNG export case and GDP multiplier.
- LNG exports are projected to have moderate impacts on domestic U.S. natural gas prices of about $0.32 to $1.02 per million British Thermal Units (MMBtu) on average between 2016 and 2035. This results in 2016-2035 average Henry Hub natural gas price estimates of between $5.03 and $5.73/MMBtu, depending on LNG export case.
- LNG exports are expected to lead to a rebalancing of U.S. natural gas markets in the form of domestic production increases (79%-88%), a reduction in domestic consumption (21% to 27%), and changes in pipeline trade with Canada and Mexico (7%-8%). The sum of the three supply sources exceeds actual LNG export volumes by roughly 15% to account for fuel used during processing, transport and liquefaction.
“Allowing the export of LNG would mean more jobs, growth in U.S. GDP, and less debt – key priorities of the American people," Gerard said. "The government can demonstrate its commitment to addressing these priorities by promptly approving authorizations to export LNG."
API is a national trade association that represents all segments of America’s technology-driven oil and natural gas industry. Its more than 500 members – including large integrated companies, exploration and production, refining, marketing, pipeline, and marine businesses, and service and supply firms – provide most of the nation’s energy. The industry also supports 9.2 million U.S. jobs and 7.7 percent of the U.S. economy, delivers $85 million a day in revenue to our government, and, since 2000, has invested over $2 trillion in U.S. capital projects to advance all forms of energy, including alternatives.