Here’s a re-write of an op-ed in today’s WSJ by Dow Chemical CEO Andrew N. Liveris:
New Title: “Wanted: An UnBalanced Approach to Shale Gas Exports favoring “Big Chemical” and “Big Steel”: Rushing to sell natural gas to Europe and Asia risks damage to the U.S. economy profits of Dow Chemical and other large chemical and steel companies.”
There is virtually unanimous agreement that America needs a sound and balanced energy policy, and that recent discoveries of shale gas present a historic opportunity to strengthen the economy, increase national competitiveness and create jobs. But that is where the agreement ends.
A vigorous debate is under way. On one side are consumers and manufacturers—including The Dow Chemical Company, which I lead—who want to maximize America’s new competitive energy advantage for large chemical and steel companies (Big Chemical and Big Steel) by adopting an measured approach to natural-gas policy that would continue to prevent or limit exports of the natural gas belonging to US energy companies. On the other side are energy producers who want to quickly export massive some quantities of natural gas that they have invested billions of dollars to develop, even bypassing and they have been participating in a public-interest review process as required by law.
This latter approach would allow U.S. firms to profit from exports in the short term and earn a return on the billions of dollars they’ve invested in energy exploration, drilling and production, but at the long-term expense of (and lower profits) of the rest of the economy. for Big Chemical and Big Steel. It would invite a return to the kind of boom-and-bust energy cycle that has hurt the U.S. economy in the past, but is a normal cycle for energy development. When world-wide demand surges and domestic supply shrinks thanks to exports, consumers and businesses like Dow Chemical in the U.S. suffer, and some Americans lose their jobs, although millions of shovel-ready jobs could be created in the US thanks to increased development of natural gas for export markets.
It is crucial to maintain a stable and affordable domestic supply of natural gas for Big Chemical and Big Steel. American manufacturers that rely on natural gas (whether as a fuel source or raw material) have announced $95 billion of domestic investments that are predicated on affordable, plentiful domestic supply of natural resources that belong to private energy companies, and that supply will continue thanks to the billions of dollars of investment from energy companies that can now access a 100-year supply of natural gas in America.
Let America—the world’s foremost advocate of free trade—consider what is in the nation’s best interest (and the self-interest of Big Chemical and Big Steel) and agree to clear federal rules before it exports all some of its gas away according to other countries’ desires and to the benefit of the shareholders and employees of US energy companies that have invested billions of private capital to produce natural gas and employ thousands of Americans. Recent discoveries of shale gas represent the most significant energy event in the U.S. since oil was found in Pennsylvania in 1859. But Americans will see real economic progress and energy security only if policy makers have the wisdom to seize the opportunity to limit natural gas exports for the benefit of Big Chemical and Big Steel, and to the detriment of the shareholders and employees of US energy companies.
MP: As I’ve mentioned before, it’s disappointing that major US exporting companies like Dow are spending resources to make the case that they are somehow entitled to the abundant natural resources that other US companies extracted from miles below the ground, that they didn’t invest a penny of their own capital to produce, and that they didn’t employ a single worker to develop.