Free Markets, Free People

Daily Archives: April 9, 2012


The US could become the world’s largest exporter of Liquid Natural Gas … “if”

Could.  That’s the operative word. “If” is the keyword.  We certainly have the assets and infrastructure.

By 2017 the U.S. could be the largest exporter of liquefied natural gas in the world, surpassing leading LNG exporters Qatar and Australia. There is one big “if,” however. America can produce more gas, export a surplus, improve the trade deficit, create jobs, generate taxable profits and reduce its dependence on foreign energy if the marketplace is allowed to work and politics doesn’t get in the way.

However, there are few things like this in which politics doesn’t get in the way.  And don’t forget the crony capitalists:

But exporters must overcome growing opposition to LNG exports by environmentalists and industrial users of natural gas. Exporters must also get multiple permits from environmentally conscious federal officials. And Rep. Ed Markey (D.-Mass.) has proposed legislation to bar federal approval of any LNG export terminals until 2025. Those who most fear global warming don’t want anyone anywhere to use more fossil fuel, even “cleaner” natural gas.

Of course the most beneficial thing to do would be to let the market for LNG work.  But there are vested interests which will lobby against that:

Exporting energy, however, rubs a lot of people the wrong way. [T. Boone] Pickens wants cheap natural gas for his 18-wheelers and opposes LNG exports. Industrial gas users argue that a vibrant LNG industry would propel domestic gas prices higher. A study by Deloitte said that exporting six 6 BCF [billion cubic feet] per day of LNG would raise wellhead gas prices by 12 cents per million BTU (about 1% on a retail basis). Advocates of “energy independence” argue that exporting LNG would tie U.S. natural gas prices to global markets.

The Energy Department’s Office of Fossil Energy is considering whether exporting LNG is in the public interest. In the meantime — shades of Keystone XL — the department has effectively put a moratorium on new LNG export licenses.

Energy’s decision-making process balances the extent to which exporting LNG drives up prices with the economic benefits of increased production and energy exports. The price assessment comes at a time when U.S. gas fetches the same price in constant dollars as it did in 1975. Producers are now shutting down production and lowering exploration budgets. The shale-gas “job machine” is now in reverse.

So what would be the ideal?

Ideally, the Energy Department should move quickly and recognize free-market principles. And the administration could send a clear policy signal that natural gas is integral to the country’s energy future and that exporting LNG is good economics and consistent with its 2010 State of the Union address to double U.S. exports over five years and create two million new jobs. But Energy is moving slowly, and administration signals on natural gas are mostly lip service. The economic-benefits study should have been done by the end of March. But last week, Energy delayed its release until late summer, and said there is no timeline to review results and develop policy recommendations. Translation: after the election.

We’ve seen this scenario before (*cough* Keystone *cough*).

Here we are in the middle of a recession and we’re seeing the same sort of nonsense being played out as we have with other energy projects.  The delays are literally playing with people’s lives and livelihoods:

Estimates of the job benefits from U.S. LNG projects depend on a variety of assumptions. Roughly 25,000 direct construction jobs would be created if all the projects are built. Increasing the U.S. natural-gas production base by another 13 billion cubic feet might translate to 450,000 direct and indirect jobs and $16 billion in annual tax revenue for federal and state coffers.

It’s easier to forecast improved trade balances. Exporting 13 BCF per day of LNG could generate about $45 billion annually. Reaching Pickens’ goals could offset another $70 billion annually of oil imports.

But, instead, the Energy Department is delaying.

And people wonder why coming out of this recession we aren’t adding jobs to the economy as we have in past recessions?

Politics and policy, my friends, politics and policy.

~McQ

Twitter: @McQandO


Has the Trayvon Martin incident become more about the media than the shooting?

If you’ve been following this incident at all, you know that much of what was initially reported was wrong and some of what has been reported since was false, manufactured and/or misleading.

American Thinker has a good round up of the story to this point.  In the article, Jeff Lipke outlines the “myth” as it was perpetrated by the media.

The two worst offenders in my opinion have been NBC and ABC.  NBC aired an edited 911 tape which was clearly meant to depict George Zimmerman as a racist.  They continue to try to defend it as a “mistake”.  No one with any common sense is buying that nonsense.

ABC used footage of Zimmerman’s arrival at the Sanford police station to claim that it didn’t support his claim he’d been attacked as there was no evidence of blood or contusions. Never mentioned was the fact that Zimmerman had been treated by EMTs who are not in the habit of leaving visible blood on a patient they treat.  Subsequent enhancement showed that initial claim by ABC to have been incorrect.  Additionally, ABC claimed that Zimmerman had used a racial slur when talking to the 911 operator.  Again, enhancing the audio makes it clear he didn’t and instead seems to be remarking about how cold it was that night.  In fact, for central Florida, it was a cold night.  But ABC jumped to the conclusion because it supported the desired evolving story line – it was a racial killing.

The unraveling of the myth seems to have the whole story losing steam.  That may be why Al Sharpton decided to be a no-show at this weekend’s rally.   And there have also been incidents that have done little to gain sympathy for Trayvon Martin.  HIs parents attempt to copyright his name obviously hoping to capitalize on his death. Then there was the rally for Martin by members of the school he attended which turned into a flash-mob looting of a local drug store.

But for the media, this has been anything but its finest hour.  One of the reoccurring criticism of blogs by the media is they’ll publish anything and have no editors to check them.  Yet it is the media, especially the two networks named above, who’ve seemed to fall into that category, editors notwithstanding.

Take the latest story circulating.   Supposedly “Neo-Nazis” are patrolling Sanford, FL.  The NY Daily News reports this as a fact.  But Legal Insurrection’s Professor Jacobson has actually tried to confirm it (wait, isn’t that what editors and research assistants are supposed to do in the media?).  And, according to his inquiry to the Sanford Police Department, there’s no evidence of any neo-Nazi group patrolling the city:

My initial e-mail (which included an embedded link to the Memeorandum thread):

“There are a number of reports in the media that Neo-Nazis are conducting armed patrols in Sanford.  Can you confirm or deny whether this is true, and provide any information you have on the subject? If someone is able to get back to me as soon as possible (and before Monday) that would be appreciated, since such rumors are spreading.”

Response from Sanford Joint Information Center:

“At this time the City of Sanford has not confirmed the presence of Neo-Nazis groups.”

My follow up:

“You say “not confirmed.” Is there any indication of such patrols that the Department is aware of?”

Further Response from Sanford Joint Information Center:

“We have no indication of any such patrols at this point in Sanford. The only large gathering was the children and their parents at the Easter egg hunt.”

How poorly are we being served by a media which now seems to be engaged in precisely what it criticized blogs for?  And how ironic is it that a blog is doing the work the media should be doing?  That’s not to say blogs are in the clear.  Every left wing blog of any size has been parroting the rumor as well.

But the fact remains this case, no matter how you feel about it, has shown the media in a very unflattering light.  Sensationalism, poor journalism, lousy and false editing, conclusion jumping,  and rumor mongering have all been evident in their coverage.

And the industry wonders why so many Americans don’t trust them any more?

~McQ

Twitter: @McQandO