Many beyond U.S. shores may not have heard of Rep. Bill Johnson (R-Ohio), but his sponsored bill in the House of Representatives, which passed on September 6, could give a massive boost to rising American liquefied natural gas (LNG) exports to the wider market.
Dubbed the Ensuring Small Scale LNG Certainty and Access Act (H.R. 4606), Rep. Johnson's bill – which cleared the house by 260 votes in favor versus 146 against – would require a "prompt" federal regulatory review of applications to import or export LNG in volumes of less than 140 million cubic feet (mcf) per day.
Thirty-seven Democrats crossed the floor and joined 223 Republicans in casting a 'yes' vote. Three Republicans and 143 Democrats voted against the measure on grounds that the move could have a "significant impact on domestic natural gas prices and adversely affect American consumers and manufacturers."
Subsequently, the bill has moved to the U.S. Senate for immediate consideration by the Energy and Natural Resources Committee and is likely to get a seal of approval.
That would mean a boost for U.S. exports to wider Latin America, and, on paper, adding to the 20% of headline American LNG exports that headed to Mexico in 2017.
In a statement, Rep. Johnson said it is critically important that the U.S. takes advantage of natural gas resources it has been blessed with. "There is no doubt that LNG exports are creating new, well-paying jobs and improving the quality of life for hard working families in eastern and southeastern Ohio."
The legislation would ensure the issue would not be subject to "the whims of future presidential administrations and policies," he added.
Predictably, U.S. LNG and wider energy lobby groups have cheered the passage of the bill. LNG Allies and Center for LNG said the move would create jobs, improve American exports and expand exporters' footprint in the Caribbean and Latin America, as well as benefit U.S. citizens in Puerto Rico.
With Henry Hub prices languishing in the $3 per million British thermal units (Btu), U.S. exporters are bound to get more bang for their buck in near America too, let alone Asia where prices hit a two-month high of $11.40 per million Btu.
U.S. LNG bulk exports are currently heading to nearly 30 countries, with Mexico, China and South Korea among the largest markets in volume terms. Last year, U.S. exports quadrupled to 1.94 billion cubic feet per day (Bcf/d). With a further uptick expected this year, exporters can expect more Latin American buyers soon.
Date: Sep 10, 2018