Momentum Builds for Gas Exports as Russia Mobilizes

Lawmakers decry ‘de facto ban’ on exports as fears of Ukrainian supply shock grow

Russian President Vladimir Putin and Russian Defense Minister Sergei Shoigu
Russian President Vladimir Putin and Russian Defense Minister Sergei Shoigu / AP
March 4, 2014

Top congressional Republicans are seizing on Russia’s invasion of Crimea to call on the Obama administration to lift barriers to U.S. energy exports.

Russia’s control of the region’s fossil fuel supplies is seen as a potent weapon in its expansionist campaign in Crimea. American policymakers hope increased U.S. exports of oil and natural gas can counter that weapon.

The first step for the Obama administration should be to remove self-imposed obstacles to U.S. energy exports, they said.

Speaker John Boehner (R., Ohio) said on Tuesday that House Republicans "will work with the Obama administration on measures to impose consequences on Russia for its hostile act," and pointed to energy exports as a good place to start.

"One immediate step the president can and should take is to dramatically expedite the approval of U.S. exports of natural gas," Boehner said in a statement.

The Department of Energy (DOE) recently gave a preliminary nod to a natural gas export terminal in Louisiana, but many critics say the regulatory process remains cumbersome and slow.

"The United States has abundant supplies of natural gas … and the U.S. Department of Energy’s excruciatingly slow approval process amounts to a de facto ban on American natural gas exports that Vladimir Putin has happily exploited to finance his geopolitical goals," Boehner said.

Russia has long used its dominance over the European gas market to leverage political power in the sphere, shutting off gas supplies to Ukraine in previous disputes in 2006 and 2009. Some worry it may do so again.

The White House announced a $1 billion aid package for Ukraine on Tuesday designed to protect its energy sector from shocks caused by a cessation in Russian imports.

It was not immediately clear what types of projects the loan guarantees would support or how they would specifically backstop Ukrainian energy supplies.

The White House referred questions about the specifics of the package to the DOE and the Treasury Department. Neither of those agencies nor the State Department returned requests for more information by press time.

The administration has yet to address the gas export issue in the context of the Russian invasion, but Republicans are already lining up to support the approval of additional export projects.

"We also need to open up exports of domestic natural gas to our allies and partners in the region so that they are less susceptible to Russia's efforts to use energy as a weapon," wrote Sen. Marco Rubio (R., Fla.) and Rep. Tom Cotton (R., Ark.) in a CNN column on Tuesday.

Sen. Lisa Murkowski (R., Alaska), ranking member of the Energy and Natural Resources Committee, told an audience in Houston on Monday that current export restrictions are reducing the country’s ability to "respond quickly and nimbly" to punitive market manipulations by Russia and others.

"If this was a situation where we wanted to use our natural gas opportunities as political leverage, we're not in that place now," she said.

Murkowski released a report on Monday highlighting the president’s authority to unilaterally lift the longstanding U.S. ban on exporting crude oil. She called on Obama to do so in her Monday speech.

House and Senate committees are already planning hearings on their own proposals to assist the Ukrainian government and punish Russia for its aggression. Proposals related to energy resilience will likely get some attention.

"Neither Ukraine nor Europe should have to be dependent on Russia for natural gas when there is an abundant supply in the United States," said Rory Cooper, a spokesman for House Majority Leader Eric Cantor (R., Va.), who is also backing efforts to lift restrictions on gas exports.

"This helps put pressure on Russia to end their aggression, and creates jobs for working middle class families at the same time."