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Here’s What The White House Isn’t Saying About Its Moratorium On Approving Natural Gas Export Hubs

The White House is neglecting to address crucial contextual information when it touts its decision to pause approvals for new liquefied natural gas (LNG) export terminals.

President Joe Biden has touted the move as a decisive step on climate, and White House National Climate Adviser Ali Zaidi suggested that fears of negative geopolitical interests for the U.S. are overblown since many key allies are transitioning away from fossil fuels in the long-term anyways. However, there is strong potential that global emissions could increase as a result of the ban, or that America’s reputation with key allies could suffer because of the administration’s decision to throw a wrench into major LNG export projects.

“In every corner of the country and the world, people are suffering the devastating toll of climate change,” Biden said last Friday, when the decision became official. “My Administration is announcing today a temporary pause on pending decisions of Liquefied Natural Gas exports – with the exception of unanticipated and immediate national security emergencies … This pause on new LNG approvals sees the climate crisis for what it is: the existential threat of our time.”

Biden’s comments suggest that American LNG export terminals and the greenhouse gas emissions associated with LNG’s transport are problematic enough to warrant a pause, and, by extension, possible termination. What he did not acknowledge, however, is that would-be buyers of U.S. LNG will look elsewhere to meet their needs rather than give up on finding supply in light of the approval pause, as energy sector experts recently told the Daily Caller News Foundation.

Instead, those would-be buyers, whether in Asia or Europe, will likely look to producers in Russia and Qatar, for example, in their scramble to fill in the unexpected gap in their forecasted supply, energy sector experts told the DCNF. The U.S. produces LNG more cleanly than most other nations, Dan Kish, a senior research fellow for the Institute for Energy Research, told the DCNF. meaning that a move prompting buyers to look to countries that produce LNG in less clean fashion is a move that effectively increases emissions.

The pause on approvals “won’t bring down emissions at all, because the U.S. produces LNG with the least environmental impact of just about every other country on Earth,” Kish told the DCNF. “Russia and Qatar are clearly in the driver’s seat as a result of this decision.”

David Blackmon, a 40-year veteran of the oil and gas industry who now writes and consults on the energy sector, agreed with Kish, telling the DCNF that “it is profoundly absurd to claim this action will do anything to curb emissions.”

Natural gas is projected to remain a major pillar of the global energy mix through 2050, with demand emerging markets increasing substantially over that time period, according to estimates from the International Energy Agency.

Nevertheless, many environmentalist groups — almost all of which consider climate change to be a global issue — took a victory lap after the administration made the decision. The White House amplified many of these reactions in a Saturday blog post, including one issued by Climate Defiance, a confrontational activist group that has targeted administration officials and elected Democrats for months. Environmental activists and young voters are poised to be key bastions of support for Biden in the 2024 presidential race.

Beyond the potential ramifications for the climate, the decision is poised to have significant geopolitical consequences that the White House has not comprehensively addressed.

Last Friday, Zaidi said that “a lot of our allies and partners who use that LNG today, actually are on a trajectory to back out that demand, to replace it with things like clean energy and energy efficiency” in response to a direct question about whether the decision will reduce emissions.

Principally, Zaidi’s comments appear to be in reference to Europe, which has significantly increased its purchases of U.S. LNG in recent years. Many European countries have ambitious climate and green energy targets, and the European Union (EU) is aiming to achieve “net-zero” carbon emissions among its members by 2050.

However, pointing to those long-term goals does not tell the whole story for Europe, which has leaned on American LNG exports since the Russia-Ukraine war started, according to data from the U.S. Energy Information Administration (EIA). Those imports have allowed Europe maintain the political will to support Ukraine in the ongoing war between the two countries, according to Politico.

In this context, the decision to pause new approvals can be understood as “a blow to NATO,” Kish told the DCNF.

Eurogas, a coalition of 101 companies and associations in the European energy market, wrote a Jan. 26 letter to Biden expressing their “serious concerns” about the approval pause, specifically highlighting the increased risks of future price volatility in the absence of unreliable supply forecasts.

“What’s certain is that in the current geopolitical environment, we’re counting a lot on American gas,” Olivier Becht, the French minister delegate for foreign trade, previously said, according to the Eurogas letter.

To that end, Europe has seen a revival in natural gas power plant construction, and several countries have invested in building LNG import terminals that could ostensibly complement American export hubs.

The Biden administration may have foreseen wide criticism of the decision’s geopolitical consequences, evidenced by Biden’s claim that there can be exceptions made for “unanticipated and immediate national security emergencies,” Blackmon told the DCNF. But that caveat is mostly symbolic, he said, because emergency situations arise much more suddenly than major capital investment planning can occur.

“That language was no doubt put into the statement to try to deflect one argument that could be used as a criticism of the move. The fact that the White House engaged in that thought process they understand how risky the decision truly is,” Blackmon told the DCNF. “These are long-term investments involving multiple billions of dollars that can’t just be turned on and off on the whim of John Podesta or Jennifer Granholm. It takes companies years — not months, years — to put together the capital required to reach a final investment decision on projects like these. We are talking about a delay of at least a year here — that’s a lot of time for financial backers to source other projects towards which to dedicate their billions in capital.”

The White House did not respond to a request for comment.

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