Inherency 15 Inherency Energy Dept Blocking 16

Natural Gas demand is increasing in Asia, old sources are insufficient

Senior fellow and Director of the Energy Security Initiative at Brookings, Charles, “Liquid Markets: Assessing the Case for US Exports of Liquefied Natural Gas,” 5-2-12, http://www.brookings.edu/~/media/events/2012/5/02%20lng%20exports/20120502_lng_exports

While about 45 percent of the Pacific Basin’s total gas demand is met by LNG imports from within the region, an additional 40 percent of its demand is met by LNG imports from outside the region, primarily from the Middle East and Russia.59 Qa- tar alone accounted for 11 percent of Japanese LNG imports in 2010. Qatari production pre- dominantly serves both the European (mostly the U.K.) gas market and the Pacific Basin gas market. Current uncontracted supply available on the spot market is likely to be sent to Asia to take advan- tage of the Pacific Basin’s higher prices. However, other than meeting the existing spare capacity for LNG production, the Middle East will have little excess supply capacity. This is in part because Qa- tar is trying to preserve its price structure with the East Asian market and partly because there is a moratorium on further development of Qa- tar’s North Field, which together with Iran’s South Pars Field, is the largest gas field in the world. An- other reason for the limited excess supply from the Middle East is that Oman, which is the sec- ond largest Middle Eastern LNG exporter to Asia, is experiencing declining LNG exports as more gas is being consumed domestically. Iran, which has the world’s second largest gas reserves, has proposed several LNG projects, but has been un- able to implement them because of sanctions. Gas demand in Asia remains strong, led by Ja- pan, South Korea, and Taiwan, which accounted for more than half of all global LNG imports in 2010.60 Japan, the world’s largest importer of LNG, has seen a particular increase in projected natural gas demand as a result of the accident at the Fukushima nuclear power plant following the earthquake in March 2011. The nuclear accident, which has caused a short-term shutdown of most of Japan’s nuclear reactors, has also prompted a review of Japan’s nuclear energy policy. The re- view comes largely at the demand of the public, which is wary of Japan’s reliance on atomic pow- er.61 In the event of a move away from nuclear power, a significant amount of Japan’s electricity production will likely be met by additional LNG shipments. It is estimated that in 2012, Japan will require an additional 974 bcf of LNG to make up for the electricity shortfall resulting from the Fu- kushima accident and the reduction in nuclear power generation.62

LNG exports solve Asia Pivot and Asian energy dependence – k2 credibility in Asia

Senior fellow and Director of the Energy Security Initiative at Brookings, Charles, “Liquid Markets: Assessing the Case for US Exports of Liquefied Natural Gas,” 5-2-12, http://www.brookings.edu/~/media/events/2012/5/02%20lng%20exports/20120502_lng_exports

Only strength in the pivot can deter enemies and assure allies to prevent conflict

Trang 13 - research fellow at the Diplomatic Academy of Vietnam

(Le Thuy, “The (continued) need for American Pivot to Asia,” http://southchinaseastudies.org/en/publications/vietnamese-publications/863-the-continued-need-for-american-qpivot-to-asiaq)

One of the oft-cited indications that the US “pivot” might be going astray in contributing to Asian stability, to many critics, is the emboldened stance many regional countries seem to be taking towards China. To these critics, American efforts to enhance alliances and partnerships in Asia were feeding many US allies and friends’ adventurism and seeding rivalry, to the detriment of regional security and stability.[7] Yet as Georgetown University’s Victor Cha has argued, America’s alliances in Asia have been maintained as much an instrument to control US allies and avoid saber-rattling with potential adversaries as they are a deterrent to those adversaries. At the beginning of the Cold War, Washington’s decision to establish bilateral alliances with South Korea and Japan instead of incorporating the latter two into a larger multilateral network where American voice would presumably hold less sway was a deliberate choice to counter Soviet influence and at the same time avoid unintended clashes with Soviet forces on the Asian front.[8]¶ ¶ That kind of restraining effect offered by alliances remains in place today. Early into Obama’s first term in office, it was demonstrated as the contours of things on the Korean peninsula turned for the worse in 2010. After Pyongyang evaded responsibility for the Cheonan incident, in which North Korea was accused of sinking a South Korean submarine and causing the deaths of 46 South Koreans, and Beijing refused to press its quasi-ally on that issue, Washington took an active role in keeping the situations in check by demonstrating support for South Korea while at the same time encouraging Seoul to exercise restraint.[9] Indeed, even China has grasped the values of US alliances with Japan in discouraging Tokyo’s backsliding into its past militarist adventurism. Given growing unease with China’s rise in various Asian capitals today, American presence is all the more critical to provide both the assurance and deterrence all regional countries need.¶ ¶ Many would point to the string of confrontations in East Asia that happened to concur with US return to the region and seem not convinced that the American “rebalance” is indeed beneficial to regional stability. It should be noted, however, that tensions in the East and South China Sea had smoldered before the Obama administration announced the “pivot” – even before the administration took office. What is truly disturbing for regional peace and stability is the correlation between signs of US withdrawal from Asia and China’s moves to advance its interests to many regional countries’ chagrin. In 1974, when American troops were beginning to leave Vietnam after the signing of the Paris Accord, China took advantage of Vietnam’s situation to capture the Paracels from South Vietnamese forces. In the early 1990s, Manila’s decision to discontinue to host American military base in the Philippines hastened further American disengagement from the region, and the Filipinos paid quite a dear price for their decision as China, emboldened by US troops’ departure from Philippine shores, leveled up its assertiveness at the Mischief Reef.[10]Apparently the Clinton administration’s demonstration of US resolve and commitment to Taiwan’s security in 1996 forced Beijing to review its strategy and adopt a more nuanced “charm offensive” towards its neighbors. Yet a decade of relative calmness in the South China Sea began to fade away as the Bush administration appeared to be indulged in the war on terrorism.[11] In formulating and executing the “pivot”, the Obama administration was responding to regional events rather than precipitating those events; in fact, Washington was answering US allies and friends’ concerns about China’s power trajectory and perceivable US distractedness in ways that help assuage those concerns rather than precipitate them and allow unnecessary conflicts to transpire.

Lack of credible assurances lead to war

Goh 8 - Lecturer in International Relations in the Department of Politics and International Relations at the Univ of Oxford

(Evelyn, International Relations of the Asia-Pacific, “Hierarchy and the role of the United States in the East Asian security order,” 2008 8(3):353-377, Oxford)

The centrality of these mutual processes of assurance and deference means that the stability of a hierarchical order is fundamentally related to a collective sense of certainty about the leadership and order of the hierarchy. This certainty is rooted in a combination of material calculations – smaller states' assurance that the expected costs of the dominant state conquering them would be higher than the benefits – and ideational convictions – the sense of legitimacy, derived from shared values and norms that accompanies the super-ordinate state's authority in the social order. The empirical analysis in the next section shows that regional stability in East Asia in the post-Second World War years can be correlated to the degree of collective certainty about the US-led regional hierarchy. East Asian stability and instability has been determined by U.S. assurances, self-confidence, and commitment to maintaining its primary position in the regional hierarchy; the perceptions and confidence of regional states about US commitment; and the reactions of subordinate states in the region to the varied challengers to the regional hierarchical order. 4. Hierarchy and the East Asian security order Currently, the regional hierarchy in East Asia is still dominated by the United States. Since the 1970s, China has increasingly claimed the position of second-ranked great power, a claim that is today legitimized by the hierarchical deference shown by smaller subordinate powers such as South Korea and Southeast Asia. Japan and South Korea can, by virtue of their alliance with the United States, be seen to occupy positions in a third layer of regional major powers, while India is ranked next on the strength of its new strategic relationship with Washington. North Korea sits outside the hierarchic order but affects it due to its military prowess and nuclear weapons capability. Apart from making greater sense of recent history, conceiving of the US' role in East Asia as the dominant state in the regional hierarchy helps to clarify three critical puzzles in the contemporary international and East Asian security landscape. First, it contributes to explaining the lack of sustained challenges to American global preponderance after the end of the Cold War. Three of the key potential global challengers to US unipolarity originate in Asia (China, India, and Japan), and their support for or acquiescence to, US dominance have helped to stabilize its global leadership. Through its dominance of the Asian regional hierarchy, the United States has been able to neutralize the potential threats to its position from Japan via an alliance, from India by gradually identifying and pursuing mutual commercial and strategic interests, and from China by encircling and deterring it with allied and friendly states that support American preponderance. Secondly, recognizing US hierarchical preponderance further explains contemporary under-balancing in Asia, both against a rising China, and against incumbent American power. I have argued that one defining characteristic of a hierarchical system is voluntary subordination of lesser states to the dominant state, and that this goes beyond rationalistic bandwagoning because it is manifested in a social contract that comprises the related processes of hierarchical assurance and hierarchical deference. Critically, successful and sustainable hierarchical assurance and deference helps to explain why Japan is not yet a ‘normal’ country. Japan has experienced significant impetus to revise and expand the remit of its security forces in the last 15 years. Yet, these pressures continue to be insufficient to prompt a wholesale revision of its constitution and its remilitarization. The reason is that the United States extends its security umbrella over Japan through their alliance, which has led Tokyo not only to perceive no threat from US dominance, but has in fact helped to forge a security community between them (Nau, 2003). Adjustments in burden sharing in this alliance since the 1990s have arisen not from greater independent Japanese strategic activism, but rather from periods of strategic uncertainty and crises for Japan when it appeared that American hierarchical assurance, along with US' position at the top of the regional hierarchy, was in question. Thus, the Japanese priority in taking on more responsibility for regional security has been to improve its ability to facilitate the US' central position, rather than to challenge it.13 In the face of the security threats from North Korea and China, Tokyo's continued reliance on the security pact with the United States is rational. While there remains debate about Japan's re-militarization and the growing clout of nationalist ‘hawks’ in Tokyo, for regional and domestic political reasons, a sustained ‘normalization’ process cannot take place outside of the restraining framework of the United States–Japan alliance (Samuels, 2007; Pyle, 2007). Abandoning the alliance will entail Japan making a conscience choice not only to remove itself from the US-led hierarchy, but also to challenge the United States dominance directly. The United States–ROK alliance may be understood in a similar way, although South Korea faces different sets of constraints because of its strategic priorities related to North Korea. As J.J. Suh argues, in spite of diminishing North Korean capabilities, which render the US security umbrella less critical, the alliance endures because of mutual identification – in South Korea, the image of the US as ‘the only conceivable protector against aggression from the North,’ and in the United States, an image of itself as protector of an allied nation now vulnerable to an ‘evil’ state suspected of transferring weapons of mass destruction to terrorist networks (Suh, 2004). Kang, in contrast, emphasizes how South Korea has become less enthusiastic about its ties with the United States – as indicated by domestic protests and the rejection of TMD – and points out that Seoul is not arming against a potential land invasion from China but rather maritime threats (Kang, 2003, pp.79–80). These observations are valid, but they can be explained by hierarchical deference toward the United States, rather than China. The ROK's military orientation reflects its identification with and dependence on the United States and its adoption of US' strategic aims. In spite of its primary concern with the North Korean threat, Seoul's formal strategic orientation is toward maritime threats, in line with Washington's regional strategy. Furthermore, recent South Korean Defense White Papers habitually cited a remilitarized Japan as a key threat. The best means of coping with such a threat would be continued reliance on the US security umbrella and on Washington's ability to restrain Japanese remilitarization (Eberstadt et al., 2007). Thus, while the United States–ROK bilateral relationship is not always easy, its durability is based on South Korea's fundamental acceptance of the United States as the region's primary state and reliance on it to defend and keep regional order. It also does not rule out Seoul and other US allies conducting business and engaging diplomatically with China. India has increasingly adopted a similar strategy vis-à-vis China in recent years. Given its history of territorial and political disputes with China and its contemporary economic resurgence, India is seen as the key potential power balancer to a growing China. Yet, India has sought to negotiate settlements about border disputes with China, and has moved significantly toward developing closer strategic relations with the United States. Apart from invigorated defense cooperation in the form of military exchange programs and joint exercises, the key breakthrough was the agreement signed in July 2005 which facilitates renewed bilateral civilian nuclear cooperation (Mohan, 2007). Once again, this is a key regional power that could have balanced more directly and independently against China, but has rather chosen to align itself or bandwagon with the primary power, the United States, partly because of significant bilateral gains, but fundamentally in order to support the latter's regional order-managing function. Recognizing a regional hierarchy and seeing that the lower layers of this hierarchy have become more active since the mid-1970s also allows us to understand why there has been no outright balancing of China by regional states since the 1990s. On the one hand, the US position at the top of the hierarchy has been revived since the mid-1990s, meaning that deterrence against potential Chinese aggression is reliable and in place.14 On the other hand, the aim of regional states is to try to consolidate China's inclusion in the regional hierarchy at the level below that of the United States, not to keep it down or to exclude it. East Asian states recognize that they cannot, without great cost to themselves, contain Chinese growth. But they hope to socialize China by enmeshing it in peaceful regional norms and economic and security institutions. They also know that they can also help to ensure that the capabilities gap between China and the United States remains wide enough to deter a power transition. Because this strategy requires persuading China about the appropriateness of its position in the hierarchy and of the legitimacy of the US position, all East Asian states engage significantly with China, with the small Southeast Asian states refusing openly to ‘choose sides’ between the United States and China. Yet, hierarchical deference continues to explain why regional institutions such as the ASEAN Regional Forum, ASEAN + 3, and East Asian Summit have made limited progress. While the United State has made room for regional multilateral institutions after the end of the Cold War, its hierarchical preponderance also constitutes the regional order to the extent that it cannot comfortably be excluded from any substantive strategic developments. On the part of some lesser states (particularly Japan and Singapore), hierarchical deference is manifested in inclusionary impulses (or at least impulses not to exclude the United States or US proxies) in regional institutions, such as the East Asia Summit in December 2005. Disagreement on this issue with others, including China and Malaysia, has stymied potential progress in these regional institutions (Malik, 2006). Finally, conceiving of a US-led East Asian hierarchy amplifies our understanding of how and why the United States–China relationship is now the key to regional order. The vital nature of the Sino-American relationship stems from these two states' structural positions. As discussed earlier, China is the primary second-tier power in the regional hierarchy. However, as Chinese power grows and Chinese activism spreads beyond Asia, the United States is less and less able to see China as merely a regional power – witness the growing concerns about Chinese investment and aid in certain African countries. This causes a disjuncture between US global interests and US regional interests. Regional attempts to engage and socialize China are aimed at mediating its intentions. This process, however, cannot stem Chinese growth, which forms the material basis of US threat perceptions. Apprehensions about the growth of China's power culminates in US fears about the region being ‘lost’ to China, echoing Cold War concerns that transcribed regional defeats into systemic setbacks.15 On the other hand, the US security strategy post-Cold War and post-9/11 have regional manifestations that disadvantage China. The strengthening of US alliances with Japan and Australia; and the deployment of US troops to Central, South, and Southeast Asia all cause China to fear a consolidation of US global hegemony that will first threaten Chinese national security in the regional context and then stymie China's global reach. Thus, the key determinants of the East Asian security order relate to two core questions: (i) Can the US be persuaded that China can act as a reliable ‘regional stakeholder’ that will help to buttress regional stability and US global security aims;16 and (ii) can China be convinced that the United States has neither territorial ambitions in Asia nor the desire to encircle China, but will help to promote Chinese development and stability as part of its global security strategy? (Wang, 2005). But, these questions cannot be asked in the abstract, outside the context of negotiation about their relative positions in the regional and global hierarchies. One urgent question for further investigation is how the process of assurance and deference operate at the topmost levels of a hierarchy? When we have two great powers of unequal strength but contesting claims and a closing capabilities gap in the same regional hierarchy, how much scope for negotiation is there, before a reversion to balancing dynamics? This is the main structural dilemma: as long as the United States does not give up its primary position in the Asian regional hierarchy, China is very unlikely to act in a way that will provide comforting answers to the two questions. Yet, the East Asian regional order has been and still is constituted by US hegemony, and to change that could be extremely disruptive and may lead to regional actors acting in highly destabilizing ways. Rapid Japanese remilitarization, armed conflict across the Taiwan Straits, Indian nuclear brinksmanship directed toward Pakistan, or a highly destabilized Korean peninsula are all illustrative of potential regional disruptions. 5. Conclusion To construct a coherent account of East Asia's evolving security order, I have suggested that the United States is the central force in constituting regional stability and order. The major patterns of equilibrium and turbulence in the region since 1945 can be explained by the relative stability of the US position at the top of the regional hierarchy, with periods of greatest insecurity being correlated with greatest uncertainty over the American commitment to managing regional order. Furthermore, relationships of hierarchical assurance and hierarchical deference explain the unusual character of regional order in the post-Cold War era. However, the greatest contemporary challenge to East Asian order is the potential conflict between China and the United States over rank ordering in the regional hierarchy, a contest made more potent because of the inter-twining of regional and global security concerns. Ultimately, though, investigating such questions of positionality requires conceptual lenses that go beyond basic material factors because it entails social and normative questions. How can China be brought more into a leadership position, while being persuaded to buy into shared strategic interests and constrain its own in ways that its vision of regional and global security may eventually be reconciled with that of the United States and other regional players? How can Washington be persuaded that its central position in the hierarchy must be ultimately shared in ways yet to be determined? The future of the East Asian security order is tightly bound up with the durability of the United States' global leadership and regional domination. At the regional level, the main scenarios of disruption are an outright Chinese challenge to US leadership, or the defection of key US allies, particularly Japan. Recent history suggests, and the preceding analysis has shown, that challenges to or defections from US leadership will come at junctures where it appears that the US commitment to the region is in doubt, which in turn destabilizes the hierarchical order. At the global level, American geopolitical over-extension will be the key cause of change. This is the one factor that could lead to both greater regional and global turbulence, if only by the attendant strategic uncertainly triggering off regional challenges or defections. However, it is notoriously difficult to gauge thresholds of over-extension. More positively, East Asia is a region that has adjusted to previous periods of uncertainty about US primacy. Arguably, the regional consensus over the United States as primary state in a system of benign hierarchy could accommodate a shifting of the strategic burden to US allies like Japan and Australia as a means of systemic preservation. The alternatives that could surface as a result of not doing so would appear to be much worse.

Asian conflict leads to extinction – draws in nuclear powers and the most populous countries

Mead 10 - senior fellow @ the Council on Foreign Relations

(Walter, American Interest, “Obama in Asia”, http://blogs.the-american-interest.com/wrm/2010/11/09/obama-in-asia/)

The decision to go to Asia is one that all thinking Americans can and should support regardless of either party or ideological affiliation.  East and South Asia are the places where the 21st century, for better or for worse, will most likely be shaped; economic growth, environmental progress, the destiny of democracy and success against terror are all at stake here.  American objectives in this region are clear.  While convincing China that its best interests are not served by a rash, Kaiser Wilhelm-like dash for supremacy in the region, the US does not want either to isolate or contain China.  We want a strong, rich, open and free China in an Asia that is also strong, rich, open and free.  Our destiny is inextricably linked with Asia’s; Asian success will make America stronger, richer and more secure.  Asia’s failures will reverberate over here, threatening our prosperity, our security and perhaps even our survival. The world’s two most mutually hostile nuclear states, India and Pakistan, are in Asia.  The two states most likely to threaten others with nukes, North Korea and aspiring rogue nuclear power Iran, are there.  The two superpowers with a billion plus people are in Asia as well.  This is where the world’s fastest growing economies are.  It is where the worst environmental problems exist.  It is the home of the world’s largest democracy, the world’s most populous Islamic country (Indonesia — which is also among the most democratic and pluralistic of Islamic countries), and the world’s most rapidly rising non-democratic power as well.  Asia holds more oil resources than any other continent; the world’s most important and most threatened trade routes lie off its shores.  East Asia, South Asia, Central Asia (where American and NATO forces are fighting the Taliban) and West Asia (home among others to Saudi Arabia, Israel, Turkey and Iraq) are the theaters in the world today that most directly engage America’s vital interests and where our armed forces are most directly involved.  The world’s most explosive territorial disputes are in Asia as well, with islands (and the surrounding mineral and fishery resources) bitterly disputed between countries like Russia, the two Koreas, Japan, China (both from Beijing and Taipei), and Vietnam.  From the streets of Jerusalem to the beaches of Taiwan the world’s most intractable political problems are found on the Asian landmass and its surrounding seas. Whether you view the world in terms of geopolitical security, environmental sustainability, economic growth or the march of democracy, Asia is at the center of your concerns.  That is the overwhelming reality of world politics

Plan

The United States federal government should approve existing Liquefied Natural Gas export terminal applications.

Solvency

DOE approval process is blocking production – harbor approval solves

Regoli and Polley 14

Natalie Regoli is a partner in Baker & McKenzie's Houston office and a member of the Major Projects Practice Group. Her legal practice focuses on LNG / gas matters and she has experience throughout the lifecycle of LNG / gas projects, petrochemical facilities, and other major capital projects, Brian Polley advises on upstream energy transactions for Baker & McKenzie, with an emphasis on the representation of exploration and production companies in acquisitions and divestitures of producing properties 4/16, “Regulatory uncertainty hampers LNG export projects” http://www.ogj.com/articles/uogr/print/volume-2/issue-2/regulatory-uncertainty-hampers-lng-export-projects.html

US brownfield projects require less capital investment than greenfield projects due to existing infrastructure, and therefore these projects are expected to be the first online. Lower investment costs and depressed gas prices at the benchmark Henry Hub enable US exporters to sell LNG for the lowest prices on the global market. The wildcard for these projects is the DOE, in particular, its lack of transparency regarding the criteria used to evaluate exports to non-FTA countries. Another cause for concern is the DOE's post-approval revocation authority, which most concerns Asian investors with ample balance sheets and large appetites for energy. The DOE reserves the power to reconsider approvals of non-FTA exports after those approvals have been granted, which worries investors, owners, and potential offtakers. Compare this to, for example, the regime created by Congress to review the national security implications of foreign investment in the US under the Committee on Foreign Investments in the US (CFIUS), where a clearance of a transaction is a safe harbor, and CFIUS cannot reconsider such decisions unless it finds that the parties misled or withheld critical facts from the committee. This post-approval revocation authority in the LNG export context creates great uncertainty and slows final investment decisions. The slow pace of the DOE's approval process alone is enough to hamper the competitiveness of US projects, especially if the export project is in the middle or end of the queue. A bottleneck at the Federal Energy Regulatory Commission amplifies the problem, with the second filer, Freeport LNG, only expected to receive final project approval in the third quarter of 2014.

Federal regulations are deterring construction of LNG export terminals

House Committee on Energy & Commerce 14 (US House of Representatives, Committee on Energy & Commerce majority staff, “Prosperity at Home and Strengthened Allies Abroad – A Global Perspective on Natural Gas Exports”, The Policy Paper Series, Vol. 3, Issue 1, February 14, 2014, http://energycommerce.house.gov/sites/republicans.energycommerce.house.gov/files/analysis/20140204LNGexports.pdf)

But yet again, federal red tape threatens to get in the way. To be exported, natural gas must be transformed into a liquid at very low temperatures, and loaded onto ships for export. The specialized LNG export facilities that can perform these tasks are an important part of the architecture of abundance, but building and operating them is subject to a very cumbersome federal permitting process. DOE plays a critical role in enabling the U.S. to take advantage of the new era of energy abundance by regulating the trade of natural gas. DOE exercises jurisdiction over the commodity itself (natural gas), whereas other federal agencies, such as the Federal Energy Regulatory Commission (FERC), state, and local bodies have jurisdiction over the facilities used to export the commodity. DOE’s authority arises under the Natural Gas Act, which sets the standard for review of most LNG export applications. Applications to countries with which the U.S. has a Free Trade Agreement (FTA) in effect are granted automatically. The process is much more complicated and uncertain for applications involving the majority of countries, those with which the U.S. does not have a FTA. The Natural Gas Act establishes a rebuttable presumption that a proposed export of natural gas to a non-FTA country is in the public interest; however, the statute does not define “public interest” nor identify the criteria that must be considered. As a result, DOE identified a growing list of factors, including economic impacts, international impacts, and security of supply. In addition, DOE relies on outdated 1984 Policy Guidelines related to the import of natural gas (at the time, it was believed that the U.S. would need to import more LNG) to weigh these factors. Overall, DOE’s standard of review is unpredictable, evolving, and has been slow to reflect the nation’s newfound natural gas abundance and the growing benefits of energy exports. DOE’s adopted procedures, including its role as a cooperating agency with FERC for the purpose of complying with the National Environmental Policy Act (NEPA), present unique challenges, as recently demonstrated in DOE’s order conditionally granting Freeport LNG authorization to export.12 Seemingly new criteria were added, and DOE partially denied the requested volume of natural gas not on the basis of previously stated public interest criteria,13 but because of a discrepancy identified in Freeport’s filing before FERC relating to the size of the facility and the environmental review process. DOE appears to be moving away from the market principles that once guided the process. In its 1984 Policy Guidelines on LNG imports, the agency stated that “the market, not government, should determine the price and other contract terms of imported natural gas … The federal government’s primary responsibility in authorizing imports will be to evaluate the need for the gas and whether the import arrangement will provide the gas on a competitively priced basis for the duration of the contract while minimizing regulatory impediments to a freely operating market.”14 DOE has seemingly abandoned this limited approach in favor of lengthy and comprehensive reviews of each export application under which almost any factor can be fair game. This unsettled review process has led to extensive delays and additional uncertainty, with more than 20 applications currently pending before the agency, some for over a year.15 Among the justifications for DOE’s cautious and case-by-case approach is the concern that if every application for export were approved, the resulting exports would create a substantial draw on domestic supplies of natural gas and cause a significant price increase. However, the previous record for FERC-approved LNG terminals does not bear this out. During the years when the U.S. faced the daunting task of building more import terminals in the face of declining production, there were approximately 33 applications that entered into the FERC application process. However, only five of these onshore import facilities were ultimately constructed.16 The reasons why only five were constructed vary, but given the complexity and costs of LNG projects, variables such as how many projects the market will ultimately support, and overcoming the federal, state, and local regulatory barriers to actually constructing a facility dictate that an approval to export LNG by no means guarantees a facility will be constructed or operational. 17 Whether these regulatory hurdles comply with the General Agreement on Tariffs and Trade and other trade agreements is a matter of considerable dispute.18 As one of the 159 member nations of the World Trade Organization (WTO), the U.S. is obligated to comply with these agreements. Ironically, the U.S. has expressed strong objections when other nations restrict exports of natural resources – such as OPEC’s oil embargo of 1973-­‐74 and ongoing efforts by China to limit rare earth exports – yet, DOE may be doing much the same by erecting regulatory barriers to LNG exports through its current interpretation of the Natural Gas Act.19 It should be noted that LNG facilities are multi-­‐billion dollar capital investments that take several years to build, so any regulatory uncertainty as to when they will be approved and to whom they are allowed to sell can have a chilling effect on investment.

U.S. possesses a surplus of natural gas reserves

Landrieu 14 (Mary L., Chair of the Senate Committee on Energy and Natural Resources, “Landrieu: Natural Gas Exports Will Create Thousands of High-Paying Jobs, Support U.S. Allies,” First hearing under Landrieu’s leadership, March 25, 2014, http://www.energy.senate.gov/public/index.cfm/2014/3/landrieu-natural-gas-exports-will-create-thousands-of-high-paying-jobs-support-u-s-allies)

“The dramatic growth in natural gas reserves and production in the United States over the past five years has resulted in economic growth, relative reductions in greenhouse gas emissions, and greater energy security. Every credible estimate of our energy future suggests we will have substantial exportable surpluses of natural gas for decades to come,” Mr. Goldwyn testified. “This bounty could enhance our national power by positioning our nation as a reliable supplier of natural gas to regions of the world that suffer from intimidation from their suppliers or simply the economy crushing burden of oil linked prices. The question before us is not whether we have this geopolitical potential, but whether we will realize it in time to help our friends and allies.”¶ “Even before we start exporting liquefied natural gas (LNG) from the lower 48 states, the American shale gas revolution has already made a significant impact on the global LNG market,” Mr. Chow testified. “An indication of the radical change the shale gas revolution caused in the U.S. is Cheniere Energy’s Sabine Pass LNG project. Sabine Pass was completed as a receiving terminal only in 2009 and almost immediately sought to become a bi-directional terminal that can liquefy and export gas as well. It will become the first LNG export terminal in the lower 48 states when it is completed by the end of 2015.”¶ Last week, Russia sanctioned nine U.S. officials, denying them entry into Russia because they hold views in opposition to Russia’s actions against the Ukraine. Sen. Landrieu was among the nine sanctioned officials.

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