As the national discussion on natural gas policy continues, let me call your attention to some important numbers on job creation and the likely economic benefits of increasing exports of energy products like liquefied natural gas (LNG).
Preliminary data from a forthcoming study on the economic ramifications of LNG exports hint at a wide range of benefits from the export opportunities made possible by America’s new abundance of natural gas.
The study is being prepared by the consulting group ICF International, and a presentation citing some of its key findings was recently made public. The projected data should give policymakers added incentive to authorize LNG export applications currently on file with the federal government.
A look at the presentation shows that ICF believes there would be an overall net gain in employment if the industry proceeds with exports. They found that by 2035, LNG exports could “result in between 28,000-116,000 direct and indirect annual job additions, as well as up to 120,000-540,000 in annual induced employment.” The ranges depend on the level of exports.
Interestingly, ICF found the overall jobs impacts are larger the greater the export volumes, refuting claims put forth by some that exports would have a negative economic impact.
All told, ICF expects a total economic contribution of $723 billion to the nation’s GDP between 2015 and 2035 under their mid-range estimate if exports go forward – an average gain to the economy of more than $36 billion each year.
Meanwhile, the Bipartisan Policy Center just issued a comprehensive strategy for guiding what it calls “America’s energy resurgence.” My colleague, Bill Colton, ExxonMobil’s vice president of Corporate Strategic Planning, is a board member of the Bipartisan Policy Center’s Strategic Energy Policy Initiative and participated in the launch of the strategy earlier this week.
Among the Center’s key recommendations is that the U.S. government should place no restrictions on international trade in fossil fuels like natural gas or coal.
In examining the export question, the authors of the report determined “that LNG exports are likely to have only modest impacts on domestic natural gas prices – LNG exports will adjust as domestic prices rise or fall.”
The Bipartisan Policy Center’s report is about more than LNG exports, of course. But it recognizes that a market-based approach to exports should be a critical part of a broader national energy policy to maximize the advantages of our newfound energy abundance.
Set aside some time to read it, as well as ExxonMobil’s latest comments regarding the DOE/NERA study on natural gas exports that I’ve written on recently. They both show that, thanks to new supplies of natural gas, there is good reason to be optimistic about the American economy, if we make the right policy decisions.