Us Imports And Exports Of Natural Gas

Author : U. S. Department of Energy United States Government
Publisher : CreateSpace
ISBN 13 : 9781481200899
Total Pages : 42 pages
Book Rating : 4.2/5 (8 download)

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Download or read book Effect of Increased Natural Gas Exports on Domestic Energy Markets As Requested by the Office of Fossil Energy January 2012 written by U. S. Department of Energy United States Government and published by CreateSpace. This book was released on 2012-12-08 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt: This report responds to an August 2011 request from the Department of Energy's Office of Fossil Energy (DOE/FE) for an analysis of "the impact of increased domestic natural gas demand, as exports." Appendix A provides a copy of the DOE/FE request letter. Specifically, DOE/FE asked the U.S. Energy Information Administration (EIA) to assess how specified scenarios of increased natural gas exports could affect domestic energy markets, focusing on consumption, production, and prices. DOE/FE provided four scenarios of export-related increases in natural gas demand (Figure 1) to be considered: * 6 billion cubic feet per day (Bcf/d), phased in at a rate of 1 Bcf/d per year (low/slow scenario), * 6 Bcf/d phased in at a rate of 3 Bcf/d per year (low/rapid scenario), * 12 Bcf/d phased in at a rate of 1 Bcf/d per year (high/slow scenario), and * 12 Bcf/d phased in at a rate of 3 Bcf/d per year (high/rapid scenario). Total marketed natural gas production in 2011 was about 66 Bcf/d. The two ultimate levels of increased natural gas demand due to additional exports in the DOE/FE scenarios represent roughly 9 percent or 18 percent of current production. DOE/FE requested that EIA consider the four scenarios of increased natural gas exports in the context of four cases from the EIA's 2011 Annual Energy Outlook (AEO2011) that reflect varying perspectives on the domestic natural gas supply situation and the growth rate of the U.S. economy. These are: * the AEO2011 Reference case, * the High Shale Estimated Ultimate Recovery (EUR) case (reflecting more optimistic assumptions about domestic natural gas supply prospects, with the EUR per shale gas well for new, undrilled wells assumed to be 50 percent higher than in the Reference case), * the Low Shale EUR case (reflecting less optimistic assumptions about domestic natural gas supply prospects, with the EUR per shale gas well for new, undrilled wells assumed to be 50 percent lower than in the Reference case), and * the High Economic Growth case (assuming the U.S. gross domestic product will grow at an average annual rate of 3.2 percent from 2009 to 2035, compared to 2.7 percent in the Reference case, which increases domestic energy demand). DOE/FE requested this study as one input to their assessment of the potential impact of current and possible future applications to export domestically produced natural gas. Under Section 3 of the Natural Gas Act (NGA) (15 U.S.C. § 717b), DOE must evaluate applications to import and export natural gas and liquefied natural gas (LNG) to or from the United States. The NGA requires DOE to grant a permit unless it finds that such action is not consistent with the public interest. As a practical matter, the need for DOE to make a public interest judgment applies only to trade involving countries that have not entered into a free trade agreement (FTA) with the United States requiring the national treatment for trade in natural gas and LNG. The NGA provides that applications involving imports from or exports to an FTA country are deemed to be in the public interest and shall be granted without modification or delay. Key countries with FTAs include Canada and Mexico, which engage in significant natural gas trade with the United States via pipeline. A FTA with South Korea, currently the world's second largest importer of LNG, which does not currently receive domestically produced natural gas from the United States, has been ratified by both the U.S. and South Korean legislatures, but had not yet entered into force as of the writing of this report.