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Berzins: Will Europe Benefit From Shale Boom?

It matters, of course, how the United States will proceed with granting permission for exports to Europe. Several senators from natural-gas-producing states have introduced the Expedited LNG for American Allies Act of 2013 (HR 580, S 192) that would reduce barriers for LNG exports to NATO allies and Japan, giving them the same preferential treatment as countries that have free-trade agreements. As the hearing showed, senators will hear economic warnings from home-state manufacturers that rely on natural gas, most notably for chemicals and fertilizer.

The United States should take care not to offend European counterparts by choosing to support exports only to NATO states. The European Union’s natural-gas markets are integrated, and European legislation is opposed to destination clauses on natural gas. This is ever more relevant in the context of free-trade negotiations between the United States and the EU.

As Sen. Mark Udall, D-Colo., argued during the hearing, “geopolitical ramifications” are a vital part of the discussion. Domestic LNG can provide European states greater independence from potentially risky suppliers, and greater energy security in Europe is in the interests of the United States.

Kristine Berzins is a Berlin-based energy analyst and author of the report “European Views on American Natural Gas Exports” for the American Clean Skies Foundation. It can be downloaded at cleanskies.org/eu-views-natural-gas.

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