Jul 28 2014
The Wall Street Journal
By John McCain (R-AZ) and John Hoeven (R-ND)
The violence on the border of Ukraine and Russia reached a horrendous level on July 17, when Russian-backed separatists shot down Malaysia Airlines Flight 17, killing 298 innocent men, women and children. This horrific event brings even greater instability to the region five months after Russian President Vladimir Putin invaded Crimea. Russia continues to intimidate and disrupt Ukraine's pro-Western government in Kiev and U.S. allies in Europe.
Mr. Putin's Russia also continues to exploit Ukraine and Europe's dependence on Russian energy, undermining support within the European Union for the tougher sanctions needed to deter further aggression. Currently, 13 European nations rely on Russia for more than half of their natural gas and four—Lithuania, Estonia, Finland and Latvia—depend on Russia for 100%. One quarter of all natural gas consumed in the EU is piped from Russia, much of it through Ukraine.
What can the U.S. do to help alleviate Europe's reliance on Russian natural gas? We can start by passing the North Atlantic Energy Security Act, legislation we sponsored and introduced with Sens. Lisa Murkowski (R., Alaska) and John Barrasso (R., Wyo.) that will deploy our own natural resources to weaken the Putin regime and strengthen our allies in Ukraine and Europe.
Today, the U.S. has the leverage to liberate our allies from Russia's stranglehold on the European natural-gas market. Thanks to new technologies such as hydraulic fracturing and horizontal drilling, America is producing more than 30.2 trillion cubic feet of natural gas a year, but only using 26.6 trillion. Oil and gas companies are forced to burn off natural gas that isn't used, as the U.S. lacks the pipeline infrastructure needed to capture it. North Dakota alone flares 40% of all natural gas produced on lands managed by the federal government, according to data from the North Dakota Industrial Commission, which overseas oil and gas development in the state. This benefits no one.
The U.S. should put that natural gas on the global market. Here's what our bill does:
First, it would streamline onshore production. It currently takes 180 to 270 days for the federal government to approve a drilling permit in North Dakota, according to the North Dakota Industrial Commission. Our legislation would remove government roadblocks and cut red tape that delays and sometimes prevents onshore American energy production. It would reform the leasing process for onshore oil and natural-gas projects on federal lands. It would set clear rules for developing U.S. oil-shale resources and would take steps to create a true all-of-the-above American energy plan, one that uses our vast natural resources to develop both traditional and renewable energy.
Second, the bill would expedite the approval process for natural-gas gathering systems. These systems capture natural gas that would otherwise be burned off and pipe it to processing plants so that it can be refined and marketed. Our legislation would provide an accelerated path under the National Environmental Policy Act for certain natural-gas gathering lines that are located on federal and Indian land and service oil wells. Our bill would also establish deadlines for approving right-of-ways, giving the federal government 30 days to approve or deny a permit.
Finally, our bill would expedite liquefied natural-gas exports to our allies. Today, a small facility in Alaska, ConocoPhillips's Kenai LNG terminal, is the only natural-gas export terminal in the U.S. The Energy Department has given final approval to another in Louisiana, which will begin exporting by the end of 2015. Six more are conditionally approved and another 26 are still under review, the majority of which have waited more than a year for a decision. Our bill requires the energy secretary to approve immediately exports of LNG to Ukraine, NATO allies and Japan in addition to free-trade countries.
A recent headline in this newspaper said it all: "Move over, Russia: U.S. is now the world's biggest oil and gas producer." We need to use our leverage wisely: to boost our economy at home, and to strengthen our national security by helping our allies resist Russian aggression. Passing the North Atlantic Energy Security Act would be a good start.
Messrs. Hoeven and McCain are Republican U.S. senators from North Dakota and Arizona, respectively.