Posted November 8, 2013
When President Obama talks about creating jobs, growing the economy, expanding exports of U.S. goods and strengthening the middle class, as he did Friday in New Orleans, most Americans are with him. And so is the oil and natural gas industry. As he said in April, creating jobs and opportunity for Americans should be our “true North.”
The president used Friday’s speech to make the case that needed improvements to the nation’s infrastructure – roads, bridges, ports and more – is a path to increased prosperity:
“Now growing our economy, creating new jobs, helping middle-class families regain a sense of stability and security so they can find good jobs and make sure that their kids are doing even better than they did – that’s always been what America’s about. But for too many people that sense that you can make it here if you try, that sense has been slipping away. … So, today I just want to offer a couple of ideas about what we could do right now together that would help our economy. Right now.”
He also linked infrastructure and U.S. overseas trade:
“What we should be focused on is helping more businesses sell more products to the rest of the world. … Thanks in part to new trade deals we’ve signed … we now export more goods and services than ever before. And that means jobs right here in the United States of America.”
The chairman of his Council of Economic Advisors, Jason Furman, agrees and blogged earlier in the day:
“Continued efforts to promote American exports would further contribute to growth and recovery.”
We support all of the above. Infrastructure, free trade, exports – these are economic fuel for America. The great news is the president’s goal of significant private investment in infrastructure that can lead to substantial benefits from overseas trade is at hand.
Currently, 21 applications for the export of liquefied natural gas (LNG) to non-Free Trade Agreement nations remain under consideration by the Energy Department – applications that could clear the way for billions in private investment in the construction of LNG export facilities, creating thousands of jobs. The studies have been done, and congressional action is unnecessary. While the Energy Department has approved four export applications over the past two and a half years, there’s still a backlog that’s delaying more jobs, more investment, more revenues to government and which could impact U.S. competitiveness in the developing global LNG market.
As we say, the studies have been done. The benefits are clear:
- A study by NERA Economic Consulting concluded that U.S. GDP would grow between $5 billion and $47 billion by 2020, depending on how much natural gas is exported.
- ICF International estimates average net job growth could range from 73,100 to 452,300 between 2016 and 2035 because of LNG exports. ICF pegs the net effect on GDP would range from $15.6 billion a year to $73.6 billion by 2035.
This is a win-win for the United States. As the president said in New Orleans, investment in export infrastructure means jobs in the building of projects and in the permanent operation of facilities, as well as tremendous trade benefits from the sale of valuable U.S. commodities overseas. In the case of LNG, we’re talking about countries like Japan, allies that want U.S. natural gas. In addition, studies have consistently shown the U.S. has sufficient natural gas reserves to meet domestic demand while supplying overseas buyers.
The beauty of investment in LNG export projects is that it can happen – if we allow it. NERA’s David Montgomery, talking earlier this year:
“… I’ve gone through many efforts to try to figure out why there is so much concern about our exporting too much (LNG). … The question is where the government is trying to make something that would not happen without the affirmative action of government. … But natural gas exports are not something which are being created by government action. They’re something that will happen. The market itself will determine quite well (the proper balancing point). … In this case all we really need to do is get out of the way.”
Infrastructure, jobs, exports – with U.S. LNG the answers are yes, yes and yes, Mr. President.
ABOUT THE AUTHOR
Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.