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Biden's Suspension of LNG Export Terminal Approvals: A Complex Situation

President Biden's decision to pause LNG export terminal approvals is a win for environmentalists but a setback for energy companies. This move impacts energy security, global supply, and climate change, as the world seeks cleaner energy sources.

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María Alejandra Trujillo
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Biden's Suspension of LNG Export Terminal Approvals: A Complex Situation

Biden's Suspension of LNG Export Terminal Approvals: A Complex Situation

President Joe Biden's recent decision to pause federal approval for new liquefied natural gas (LNG) export terminals has far-reaching implications. This move puts at least four projects seeking approval on hold, potentially harming America's long-term economic and geopolitical interests. However, despite the pause, the U.S.'s LNG export capacity is still expected to double by the end of the 2020s.

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The Pause: A Win for Environmentalists, a Setback for Energy Companies

The announcement is a significant victory for environmentalists and a source of frustration for natural gas players. It halts billions of dollars in development for energy companies as Biden aims to factor in the impacts on climate change in LNG permitting. The pause affects all LNG export projects that have not yet received approval, impacting countries without free trade agreements with the U.S.

National Security Risks and Global Energy Security

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Biden's decision raises concerns about national security risks, particularly in light of conflicts in Ukraine and the Middle East. The ban will impact long-term projects and exports, potentially affecting energy security in Europe, Asia, and the Philippines. It also questions the reliability of the United States as an energy exporter, which could lead to increased reliance on dirtier energy sources.

Impact on Domestic Energy Security and Global Supply Dynamics

The pause on approvals for new U.S. LNG export projects to non-FTA countries is expected to hinder domestic energy security, increase reliance on hostile foreign powers for energy, and potentially cause market instability and price fluctuations. Experts warn that the ban on LNG approvals could have far-reaching negative impacts on energy security across the United States, Europe, and Asia, with potential consequences for LNG buyers and global supply growth.

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Despite these concerns, the U.S. Energy Information Administration projects stronger pricing into 2025 as LNG export capacity increases. Three new LNG terminals are expected to come online by the end of 2025, adding 5.3 billion cubic feet per day of new LNG export capacity. This growth, however, does not negate the potential negative effects of the current pause on approvals.

In Louisiana's 'Cancer Alley', residents like James Hiatt are celebrating the decision, which has particularly halted plans for the CP2 LNG terminal. The move is seen as a significant rebuke to the oil and gas industry and a step towards renewable energy sources.

The pause prevents 681 coal plants worth of greenhouse gas emissions and addresses the issue of eco-anxiety among young people. This decision is seen as a win for hope and a call for continued organized action.

As the world grapples with the realities of climate change and the need for cleaner energy sources, decisions like Biden's pause on LNG export terminal approvals will continue to shape the global energy landscape. The implications of these decisions reach far beyond economic and geopolitical interests, touching on matters of public health, local livelihoods, marine wildlife, and the future of our planet.

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