When President Joe Biden announced his temporary pause on liquid natural gas (LNG) exports in January, he said it “sees the climate crisis for what it is: the existential threat of our time.”
A federal judge put a stop to the ban six months later.
“[The] Defendants’ action were outside the scope of their authority and rooted in politics and Defendants’ climate change policies,” wrote U.S. District Judge James D. Cain Jr. last week as he issued a preliminary injunction.
Cain said the 15 state attorneys general who sued the administration were justified in their actions because the country’s LNG market is expected to boost gross domestic product by $46 billion by 2030. He noted the Department of Energy last year rejected a request to end LNG exports.
“There never seemed to be a good reason for the pause in the first place, and it looks like the courts couldn’t find one either,” Philip Rossetti with R Street Institute told InsideSources.
The American Petroleum Institute (API) argued the pause never made much sense because it ceded America’s energy advantage to foreign nations and threatened thousands of jobs.
Natural gas production has helped pace the American economy. U.S. Energy Information Administration (EIA) statistics show American companies exported more LNG than any other country last year.
Global politics played a major factor in America’s jump to the top.
The European Union turned to the U.S. for LNG following Russia’s invasion of Ukraine in 2022. American LNG exports to Europe shot up 115 percent shortly after the war started.
Last year, the U.S. sent 66 percent of its LNG shipments to gas-hungry European nations like France, the Netherlands, Germany, and the United Kingdom.
That’s changed since Biden’s LNG export pause was announced.
Gas and oil analytics company ICIS reported Russia took over as Europe’s biggest supplier of natural gas in May. It initially said so-called “one-off” factors caused Russian gas imports to eclipse U.S. imports by one percent.
Yet, the EU remained reliant on Russian LNG versus American LNG last month, according to ICIS. While the volume difference was .24 billion cubic meters, the numbers troubled energy analysts.
“If we put a pause in the permitting, that tells [the EU and Asia] this natural gas from America may not be available in the future,” Trisha Curtis, CEO of energy consultant Petronerds, told InsideSources.
New sanctions announced last month did not include the LNG import ban supported by Sweden and Baltic countries. The lone holdout was Germany, which relies heavily on Russian LNG. Instead, the sanctions said Russian LNG couldn’t be imported and then sent to another country.
American LNG will continue to flow to the EU in the short term. But few contracts go beyond 2030 despite the EU’s top energy official saying last year there “will be a need for American energy.” Some of that has been credited to the EU’s ambitious climate goals.
Why did Biden hit the pause button on LNG exports? November politics.
The White House met with environmentalists in the months leading up to the executive order. One influencer warned that voters would “reward or punish” the president for the export ban.
Curtis scoffed at the idea that Biden could win the election by catering to 20-something-year-old environmentalists. She said the “environmental stuff means nothing” because carbon emissions dropped 36 percent from 2005 through 2021 in the U.S. That drop was credited to the switch from coal to natural gas.
When asked why the administration enacted the pause despite science showing that natural gas is good for the environment, Curtis said it was because policymakers don’t understand how energy works.
“They’re putting greenwashing ahead of humankind, truthfully.”
Reprinted with permission from DC Journal by Taylor Millard.
