U.S. lawmakers to weigh speeding up LNG exports to help Europe, Ukraine

WASHINGTON, March 25 Tue Mar 25, 2014 10:30am IST

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WASHINGTON, March 25 (Reuters) - U.S. lawmakers will hear testimony on Tuesday from those who favor loosening restrictions on liquefied natural gas exports so that abundant American supplies could help reduce Ukraine and Europe's dependence on Russian gas.

European worries about the security of energy supplies have grown since Russian forces seized control of the Crimean peninsula from Ukraine this month. Moscow has in years past cut gas supplies amid regional disputes.

Currently, the U.S. Department of Energy must give permission to export natural gas to all but a handful of countries with free trade agreements with the United States.

Opponents of unlimited gas exports have argued that shipping too much natural gas abroad could cause U.S. prices to rise, hampering the economy's ability to recover from the recent recession.

Hearings before the House and Senate energy committees come on the heels of the Energy Department's sixth approval of LNG exports from a U.S. plant in the past 10 months.

"While our government does not dictate where that supply will go, it does control how fast we will connect to the global market," David Goldwyn, a senior fellow at Brookings Institution, will tell lawmakers at a Senate Energy Committee hearing slated for 10 a.m. EDT (1400 GMT) on Tuesday.

This will be Senator Mary Landrieu's first hearing as chairwoman of the Energy Committee. The Louisiana Democrat has pressed to streamline review of the 24 applications in the queue.

A vocal coalition of industrial companies, led by Dow Chemical Co, has disputed claims that speeding up the Energy Department approvals would help Ukraine or other allies as substantial U.S. gas exports remain years away.

ELIMINATING DOE'S REVIEW

One solution is legislation that the House Energy Committee will consider on Tuesday afternoon to allow U.S. natural gas exports to any country that is a member of the World Trade Organization without government approval.

While the administration has not officially taken a position on the measure, Deputy Assistant Secretary for Oil and Natural Gas Paula Gant will tell lawmakers the bill would essentially eliminate the need for Energy Department review of applications.

The WTO encompasses 159 nations, including every country that has expressed interest in LNG imports, Gant said in prepared testimony.

Instead exporting natural gas, the United States should look to export drilling technology that would allow countries such as Ukraine to tap their own shale gas reserves, Dave Schryver, the executive vice president of the American Public Gas Association will tell lawmakers at the House hearing.

"There is certainly no good reason why the U.S. should undertake a domestic LNG export policy that has numerous downsides for the American gas consumers when many of the very countries we are seeking to help are capable of helping themselves by accessing their own domestic shale gas reserves," Schryver said.

APGA, which is a part of Dow's coalition, is opposed to all U.S. LNG exports, which it says will increase the price of U.S. natural gas. (Reporting by Ayesha Rascoe; Editing by Steve Orlofsky and Lisa Shumaker)

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