Freedom, Security and American LNG

Mark Green
Posted December 27, 2023

Just a few years ago, the important benefits of American liquefied natural gas (LNG) weren’t clear to all as they are today – which energy consultant Steve Everley noted in a recent X post:

We’ll get back to the U.S. Energy Information Administration graphic in Everley’s post shortly. His main point is on target: You could hear the eyeballs rolling from some quarters in 2019, when the Department of Energy (DOE) heralded natural gas exports as the “molecules of U.S. freedom.” This was soon after then-Energy Secretary Rick Perry said that “the United States is again delivering a form of freedom to the European continent” in the form of natural gas.

The New York Times was among the skeptics. “You may wonder, what are these molecules?” a Times article asked – and then answered: “The technical answer is liquefied natural gas. Or, if you are in charge of energy policy for the Trump administration, ‘freedom gas.’ Let that seep in.”

Some joined in the “mockery” Everley noted, including Politico’s energy reporter, who assured readers that DOE’s “freedom gas” announcement wasn’t a joke. Then-Gov. Jay Inslee of Washington state tweeted: “This has to be a joke (Remember freedom fries?).”

Unfolding events have shown that the joke is on them and others.

Last year, American LNG played the biggest role in preventing an energy crisis in Europe after Russia cut off natural gas supplies to countries that opposed its unjust war against Ukraine.

The U.S. became the largest LNG supplier to Europe in 2022, surging more than 800 cargoes – a 141% increase over 2021. Europe was the primary destination for American LNG last year, accounting for 6.8 billion cubic feet per day or 64% of total U.S. LNG exports. That’s what you see in the EIA graphic in Everley’s post above.

In recent Capitol Hill testimony, API’s Amanda Eversole, executive vice president and chief advocacy officer, described American LNG’s game-changing role:

“The European Union’s bold commitment to eliminate its reliance on Russian natural gas represents the biggest fundamental shift global natural gas markets have ever seen.”

American LNG’s role isn’t done, Eversole said.

“While U.S. LNG helped stave off the worst of Europe’s energy crisis over the past 18 months, European natural gas prices are still double their long-term average and more than quadruple those in the United States. There is also widespread concern that the coming winters will be even more difficult. A full, long-term rebalancing of European gas markets will be difficult, yet U.S. LNG is among the most feasible and reliable options.”

A 2022 analysis found that decisions made today by policymakers in the U.S. and Europe will determine  whether dependable, affordable and sustainable energy can be supplied in years to come. This includes:

• Expanding American capacity to send LNG to the European Union (EU) and the EU’s commitment to increased LNG import capacity;
• Long-term LNG purchases and infrastructure contracts, supported by an appropriate European legal framework;
• Timeliness and transparency across the permitting and approval processes so the U.S. can meet its commitments and strengthen global energy security.

America’s LNG strength supports domestic benefits as well, including increased natural gas production, job growth and economic contributions.

Eversole said while supplying Europe has been primary, others need American energy, too:

“We must not forget the vital role U.S. LNG is poised to play in meeting soaring energy demand in Asia and the rest of the developing world. Many of these countries are looking to LNG to help displace higher-emitting fuels as part of their long-term decarbonization strategies, and the United States is one of the few countries that can supply it.”

To meet the challenge, smart, forward-looking policy is needed. Eversole said about 40 million tonnes per year of proposed LNG export capacity is languishing at the Department of Energy:

“America’s global energy leadership has never been more important. Our success hinges on doing everything possible to promote bountiful and responsible domestic production.”

Four years after some rolled their eyes at the concept of American natural gas as linked to spreading freedom, let’s hope there’s broader agreement that it is real and true and worthy of wide support.