Sixty years ago in 1956, Elvis Presley got his first hit with “Heartbreak Hotel, Norma Jean Mortenson became Marilyn Monroe, and President Dwight Eisenhower signed the law that created the Interstate Highway System.
That year was also the last time the United States was a net exporter of natural gas. But thanks to fracking and the shale energy boom, our country reached a new milestone in 2016, The Wall Street Journal reports [subscription required]:
The U.S. has become a net exporter of natural gas, further evidence of the how the domestic oil and gas boom is reshaping the global energy business.
The U.S. has exported an average of 7.4 billion cubic feet a day of gas in November, more than the 7 billion cubic feet a day it has imported, according to S&P Global Platts, an energy trade publisher and data provider. Exports also topped imports for a few days in September, Platts reported. It has been nearly 60 years since the U.S. last shipped out more natural gas than it brought in annually, according to the U.S. Energy Information Administration.
The milestone comes less than a year after restrictions on most crude oil exports were lifted, allowing tankers of crude to be freely shipped overseas for the first time nearly half a century, and together they mark a significant and potentially permanent change in the way U.S. energy flows around the world. Overseas producers now have to deal with the growing clout of the U.S. energy industry, which is aggressively looking to ramp up its global market share to help offset a long period of low prices.
“Gas exports have risen more than 50% since 2010,” the Journal adds. “The Energy Department says the country will be the world’s third-largest producer of liquefied natural gas for export by , trailing Australia and Qatar.”
Most natural gas exports are going to Canada and Mexico, but a promising market is China which is about to receive its second U.S. shale gas shipment.
The Energy Information Administration predicted the U.S. would become a net natural gas exporter by 2017, but there was an inkling that this would happen sooner. Earlier this month, Bloomberg reported, “The U.S. is set to export a record number of cargoes, demonstrating a strong international demand for U.S. shale gas.
At the same time domestic natural gas is being exported—supporting good-paying jobs--consumers are seeing lower energy prices.
A 2015 Harvard Business School study found that fracking and the shale energy boom it prompted helped consumers save $780 in energy costs, and that savings is expected to rise to $1,070 by 2030.
Also, residential electricity prices are on pace to fall for the first time since 2002.
Continuing this positive trend requires better energy policies. For instance, we need speedy federal regulatory approvals to allow the natural gas exports to non-FTA nations like Japan and China.
Earlier this year, both the House of Representatives and the Senate passed their own energy bills that include LNG export application streamlining. After months of little activity, the conference committee should finish their work and get a final bill to the president for his signature.
Also, regulatory agencies need to streamline how they permit safe energy infrastructure projects like pipelines to prevent them from being bogged down in red tape.
As David Taylor, president of the Pennsylvania Manufacturers’ Association, wrote in a letter to Federal Energy Regulatory Commission supporting the Atlantic Sunrise natural gas pipeline project:
We must be able to transport the gas to refine it, manufacturer other products from it, and then export it to our friends and allies throughout the world. Only with more pipeline infrastructure can our global leadership flourish.
The Permitting Dashboard created through the Fixing America’s Surface Transportation (FAST) Act is designed to promote transparency and accountability and speed up permitting for infrastructure projects like oil and natural gas pipelines.
With good policies in place, we can keep U.S. energy exports on its healthy, job-creating path.
Does America need an "All of the Above" energy strategy? Find out here.
This Chamber Explainer will get you up to speed.