Any major decisions about exporting LNG from the United States are likely on hold until after the 2012 election cycle is complete, Center for Liquefied Natural Gas President Bill Cooper said June 7.
Speaking at a Hart Energy Conference in Houston, Cooper said most companies interested in exporting LNG, with the exception of Cheniere Energy Inc. and its Sabine Pass facility, are in a "waiting process." That process will likely continue until an undisclosed third party completes a macroeconomic study of the effects the proposed exports would have on the U.S. economy, Cooper said.
As a result of political concerns, he said, it is likely that the release of the study's findings is some months away, causing a de facto moratorium. "Politics trumps process," he said. "And we are in an election year."
Cooper said the hardened positions of Democrats and Republicans on opposing sides of energy matters have made it almost certain nothing changes through November.
"It's so cliché to even say it, but the partisan divide is incredibly strong and will probably remain so through the election. [The] Keystone XL [pipeline] is a perfect example," he said. "Between now and the election, you're not going to see a whole lot of movement on energy issues."
Without any clear way forward, Cooper said, proposed LNG projects that have not received approval from the U.S. Department of Energy have been put into deep freeze.
"There is no time frame [for construction]. ... At the DOE, we have one application in the Lower 48 that has been approved and that's Sabine Pass," he said. "The timeline is about nine months, but you can't use that as an example because of the de facto moratorium."
Cooper said multiple factors make it more likely that LNG export facilities in the Gulf Coast region will survive, while the future for others is less promising.
"Cove Point on the Atlantic is looking to do the same thing [export LNG]. The West Coast is a bit more problematic. ... There's a lot of local opposition, but you've certainly got a couple in Oregon that have promise," he said. "It's hard to say [how many will be built] ... not all applications filed will be approved, and not all approved will be built."
Copyright 2012 SNL Financial LC. All Rights Reserved.
(Originally published June 13, 2012, in SNL Daily Gas Report.)