The natural gas (from fracking) “boom” that has been touted as the key to America’s energy independence is being sold abroad as fast as deals can be cut. The British gas company Centrica announced this week it has contracted for nearly 90 billion cubic feet of liquefied natural gas (LNG) a year for 20 years from Cheniere Energy’s Sabine Pass, Louisiana, terminal, at which a gas liquefaction plant is now under construction. That’s enough gas to supply 1.8 million UK homes, and according to Centrica’s CEO Sam Laidlaw will help “to secure the UK’s future energy security.”
Other countries whose security is being enhanced by planned exports from Sabine Pass are Korea, Spain, India and France, each of whom plans to buy more gas than Centrica. Moreover, Sabine Pass is just the first of 21 proposed gas-liquefaction plants proposed to be built ASAP in the United States. If permitted, they would export 28 billion cubic feet of gas per day — 41 per cent of US gas production last year.
The US industries that use natural gas, and are benefiting from the current, glut-induced low prices in the US, are of course crying foul about the planned exports (which must, of course, first be approved by the federal government). They worry, apparently, that having only 60 per cent of American natural gas left for Americans might cause an increase in prices. To which the typical economist’s technical response is — d’oh!
Set aside for a moment the fact that the US gas “boom” is not a boom at all [see: Math Unmasks Oil and Gas Boom as Bubble, and Expert: Shale Gas Boom a Bubble About to Pop], and ask only this question: if the argument for permitting unrestrained fracking for natural gas, despite its dangers, is that it will drive down energy prices and enhance energy security, what is the argument after you have sold half the fracked gas overseas?
The facts are stark, ominous, and without advocates in the public square:
the boom is not a boom at all, but a balloon that will likely pop before the UK contract even takes effect in 2018;
energy independence for the United States, and for that matter energy security for the UK, is not possible without massive changes in both consumption and production that no one wants to discuss, let alone begin; and in the meantime
business as usual is going to kill us all.
[See also: Energy Industries Rush to Sell Out Their Country]