Liquefied natural gas is natural gas (primarily methane) that has been liquefied by reducing its temperature to -260 degrees Fahrenheit at atmospheric pressure.
Should the US export LNG? US natural gas price is approx. 3.65 per million BTUs as of this writing and in Japan, for example, the natural gas price is approx. $17. This makes exporting natural gas look very attractive.
The chemical industry that uses natural gas believes that it is too early to enter the export market of LNG. Because of their dependency on natural gas under current economic conditions and costs, they believe that is important to develop natural gas for domestic use only and that it not be shipped to other countries.
There are those who believe that it is an important time to become an LNG exporter. The US Department Energy is reviewing many requests to build export facilities for LNG.
The US natural gas shale play has been very successful over the last few years to the point that we have a supply glut. Therefore, LNG could become a bigger component of the energy equation over the next several years. LNG is transported to world markets such as Japan in vessels, and considering our abundance of natural gas it could become a potentially major new sector for the US energy industry.
In 2004 LNG accounted for 7 percent of the world’s energy. Despite the fact that natural gas could be a very significant factor in the years ahead, oil continues to be our dominant energy source, so the transition to a natural gas economy has presented us with a great challenge. It will take courage to make the critical and difficult decisions to transform the way we consume and produce energy.
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