Posted June 5, 2014
The Wall Street Journal (ROBERT PROFUSEK): Since the 1970s, multinational companies regularly relocated manufacturing outside the U.S., chasing what GE’s Jeff Immelt coined “labor arbitrage,” and the conventional wisdom was that U.S. manufacturing was heading to an inexorable death. The conventional wisdom has, however, proven untrue, as so often is the case.
Some of the reasons for the rebirth of manufacturing in the U.S. were the inevitable consequences of the rapid rise in industrialization in emerging market countries–think of the pollution and daily rolling brownouts in India, labor unrest and increased wage and work rule demands in China and unpredictable legal systems in many emerging market countries. But the fundamental factor driving manufacturing back to the U.S. is technology–computers and robots have further eroded the labor arbitrage, and the U.S. is the undeniable global leader in technology and innovation. At the same time, the U.S. is in the midst of an energy boom, itself technology-enabled, producing an enormous cost and reliability advantages. While this particular advantage can be expected to diminish over time, it is real and the catch-up time is likely to be long, as evidenced by China’s inability to date to exploit its own shale gas reserves cost-effectively.
Posted June 2, 2014
Posted May 30, 2014
In announcing plans to revamp the way it considers permit applications for projects to export U.S. liquefied natural gas (LNG) to non-free trade agreement countries, the Energy Department said changes would help streamline the process and increase efficiency.
Unfortunately, the revisions could mean more Washington delay and inject additional uncertainty for multi-billion-dollar investments – hampering efforts to harness America’s game-changing opportunity to create new jobs, boost the economy and stimulate domestic production with LNG exports.
In a DOE blog post, Christopher Smith, principal deputy assistant secretary for fossil energy, writes that the department will review export applications and make final public interest determinations only after environmental reviews are completed. It would end the department’s procedure of the past year and a half of issuing conditional approvals pending environmental review.
Posted May 30, 2014
The Hill: The Department of Energy (DOE) released two reports Thursday with favorable conclusions about the environmental impacts of exporting liquefied natural gas (LNG).
The department said it is not “reasonably foreseeable” that there would be any domestic environmental impacts from the increased natural gas drilling and hydraulic fracturing, or fracking. And in Europe and Asia, the natural gas would have much lower greenhouse gas emissions than coal when used for power generation.
The DOE is publishing the reports to gather comments on them and eventually use them in determining whether individual LNG export applications are in the country’s interest. Neither report is required by law, the agency said.
The reports came the same day the DOE proposed a new, streamlined process for considering applications to export LNG to countries with which the United States does not have a free trade agreement.
Posted May 23, 2014
Bloomberg Businessweek: Mark Hiduke recently raised $100 million to build his three-week-old company. The 27-year-old isn’t a Silicon Valley technology entrepreneur. He’s a Texas oilman.
Now that a breakthrough in shale drilling technology has U.S. oil and gas production booming, an aging workforce is welcoming a new generation of wildcatters, engineers, and aspiring oil barons. After years of failing to attract and retain young talent, the industry is suddenly brimming with upstart millennials such as Hiduke—oil and gas veterans call it “the great crew change.” “I’ve never seen an industry do what the oil and gas industry has done in the last 10 years,” says T. Boone Pickens, the 86-year-old oilman. “Ten years ago I could not have made this statement that you have picked the right career.”
Posted May 22, 2014
Energy and economic prosperity go together – on that most Americans agree. New polling finds strong majorities ofregistered voters connect exporting natural gas and new job creation, trade deficit reduction and a stronger economy.
The results mirror findings in other recent surveys on energy infrastructure investment and construction of the Keystone XL pipeline. All together, they tell decision makers to choose pro-energy development and investment policies to put more Americans to work and to make America stronger in the world today.
Posted May 20, 2014
Last week’s finding by federal regulators that a proposed liquefied natural gas (LNG) exporting project in southern Maryland would pose “no significant impact” on the environmental is great news for the local and state economy, as well as for the United States, when it comes to broader trade and economic benefits from exporting U.S. LNG. Let’s hope the commission quickly follows up to approve the $3.8 billion project at Cove Point, Md.
Diane Leopold, president of Dominion Energy, which owns the existing LNG import facility (left) where the export project is planned:
“This marks another important step forward in a project that has very significant economic benefits and helps two allied nations in their efforts to increase their energy security and reduce their greenhouse gas emissions. … The Cove Point LNG facility has been in existence for nearly 40 years and this makes the most of existing facilities. This project will be built within the existing footprint and fence line of an industrial site. There is no need for additional pipelines, storage tanks or permanent piers, thus limiting its impact and making an environmental assessment appropriate.”
Posted May 16, 2014
Bloomberg: Dominion Resources (D) Inc.’s plan to export liquefied natural gas cleared a U.S. environmental review, a key step toward final approval as supporters in Congress seek to expedite overseas shipments of the fuel.
U.S. Federal Energy Regulatory Commission approval of Dominion’s proposed Cove Point project on Maryland’s Chesapeake Bay would have “no significant impact” on the environment, as long as proper measures are taken, the staff said today in an environmental assessment.
The full commission is scheduled to issue a final decision on Cove Point by Aug. 13. Cheniere Energy Inc. (LNG)’s Sabine Pass is the only U.S. project so far to win approval from the FERC and Energy Department.
Posted May 15, 2014
CNBC (Spencer Abraham/Bill Richardson): Once again the world is looking for America's leadership in unsettled times. Our diplomats have limited options to combat Russia's annexation of Crimea, but they can take greater advantage of a new tool in their toolbox that no administration has had for generations — U.S. energy abundance. American energy exports will not only create economic opportunities here at home but will provide strategic geopolitical advantages abroad.
The crisis involving Ukraine and Russia highlights the need for American energy leadership. Russia remains the world's largest exporter of natural gas, supplying 30 percent of Europe's imports. Countries on Russia's periphery, many nearly completely dependent on Russian supply, pay exorbitant oil linked prices. Many are NATO allies.
Posted May 14, 2014
Wall Street Journal (subscription publication): Top Obama administration officials are considering relaxing federal laws banning crude-oil exports, a move that would upend decades-old policy, cause a political stir in Washington and sway the global oil market.
U.S. Energy Secretary Ernest Moniz said Tuesday that some of the fast-growing supply of domestically produced oil isn't suitable for refining locally, which could warrant re-examining a nearly 40-year-old law that bans exports of most crude.
"The nature of the oil we're producing may not be well-matched to our current refinery capacity," Mr. Moniz said Tuesday after an energy conference in Seoul. The administration is studying the issue, though government officials declined to comment on its scope or timing.