By OGJ editors
HOUSTON, Apr. 4 -- US government and industry officials—noting the role LNG is expected to play in bridging the gap between future US natural gas demand and production—have formed the International LNG Alliance (ILNGA), an organization that will focus on LNG policy and trade issues.
The US Energy Association made the announcement Apr. 1 at a half-day conference it hosted at the American Gas Association's headquarters in Washington, DC. The conference, "LNG Imports, Obstacles & Opportunities," reviewed issues relating to LNG growth.
USEA Executive Director Barry Worthington said LNG currently has a market share of less than 1%. "ILNGA can play an important role in facilitating the development of sound energy policy as LNG grows."
Recent changes made by the Federal Energy Regulatory Commission in the regulation of LNG facilities have set the stage for significant expansion of US LNG markets, ILNGA Executive Director David Sweet said.
At the conference, James Kendell of the US Energy Information Administration told government and industry representatives that the US would need about 12 tcf of incremental natural gas supply by 2025. "US natural gas supplies (both domestic and imported) will become increasingly dependent on new, large-volume projects," he said.
LNG is a huge part of the national energy plan, and currently there are about 45 LNG projects in various stages of development that offer business opportunities, said US Department of Energy Assistant Secretary for Fossil Energy C. Michael Smith.
"(LNG) offers the opportunity for a whole lot of stranded natural gas to reach a growing US market," Smith said, "A big challenge is going to be infrastructure. How are you going to build it? How are you going to move it?"
Building infrastructure to bring LNG into more widespread use must be addressed, agreed FERC Chairman Pat Wood. Getting the commodity to the nation's (currently four) receiving terminals is one thing, he said, but moving natural gas through pipelines to where it is needed is another. And each proposed LNG facility must be assessed individually.
Safety issues
Wood also emphasized the importance of working with local officials and addressing the issue of LNG safety. "The (US) Coast Guard has to be comfortable about safety issues, including the concern of increased tanker traffic."
"Based on a recent survey of Capitol Hill energy staff, there is a substantial level of concern in Congress on LNG safety issues," Sweet noted. "Interestingly, the survey also indicated a desire for more regulation of the energy industry in the wake of the Enron (Corp.) and California (energy crisis) scandals."
Worthington said that ILNGA and USEA would follow up with new initiatives with respect to LNG in the US and worldwide, including a conference in September in Houston that will further examine these issues and commercial opportunities.