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Rising Global Energy Prices Keep LNG Debate Alive People debating proposed LNG terminal projects in Oregon now have to factor the complicated issue of rising global energy prices into their arguments.
Current projections are for double-digit increases in residential energy bills in the region this winter. This information is arming terminal proponents, attracting business groups, and could prompt federal regulators to fast-track the approval of one of the proposed projects.
Oregon senators and representatives have requested the slowing of the FERC’s decision on the Bradwood Landing terminal proposal, as has the state’s governor.
Senator Ron Wyden, a Democrat, has co-sponsored a bill that would restore LNG siting authority to individual states. The 2005 Energy Policy Act had given that authority to the FERC.
Several influential senators, including Barack Obama, have signed on to the proposed bill, but those watching the debate unfold acknowledge that the current political climate is resistant to anything that seeks to limit access to new sources of energy.
Terminal opponents are still hoping that decisions can be delayed until after the 2008 elections.
In Oregon, while many have protested the approval process itself, fewer have claimed the new gas supply would be unwanted. And labor and business groups have been lobbying in favor of the terminal proposals.
Manufacturers in particular are warning that high energy prices could adversely affect the region’s employment.
But others have pointed out that LNG is typically delivered at market prices. Furthermore, Asian nations with no gas supply of their own are attracting shipments of LNG at prices far higher than the current U.S. market is seeing.
In a letter to the FERC, Sen. Wyden noted that recently opened terminals are seeking ways to divert their contracted supplies to more lucrative Asian markets. Terminal proponents say the high prices in Asia won’t last, as more LNG supply comes online worldwide. But gas demand in developing nations is growing far faster than in the U.S., at the same time that new drilling technologies are increasing the domestic supply. Return to September 2008 Western Energy News To sponsor Western Energy News , please contact WEI at 503 231-1994.
Copyright © 2008. Reuse of this publication or its contents is allowed with credit to Western Energy Institute. WEI - 827 NE Oregon Street, Portland, Oregon 97232-2172
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