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LNG, Crude Oil Exports Good For U.S. Economy, Says API Head

Calling it a "policy relic" of a bygone era when scarcity dominated, American Petroleum Institute (API) chief Jack Gerard on Tuesday reiterated a call to lift the ban on U.S. crude oil exports and called for liquefied natural gas (LNG) exports.

Gerard made the comments when issuing API’s 2015 report (see Daily GPI, Jan. 6). The industry-backed organization has issued several studies recently pushing for exports to create jobs and boost the U.S. economy (see Daily GPIMay 20, 2013and Shale DailyApril 1, 2014).

"The decades-long ban on crude oil exports does nothing more than impose an unnecessary cost on American consumers and American businesses' global competitiveness," said Gerard. President Obama “has a ready-made opportunity to achieve his vision of increased trade by leading the effort to allow exports of crude oil."

API wants Congress to eliminate the crude oil ban, but more immediately, Gerard hopes the president will take steps to open up crude exports to lower the nation's trade imbalance. "Energy is a good place to look; it's a ready made opportunity," Gerard said.

He also wants more crude imports. Approving he Keystone XL oil pipeline to carry crude from Canada to Gulf Coast markets is a top priority because it is "low-hanging fruit,” Gerard said. and "If we focus on things like crude oil and LNG exports, we have a real opportunity to achieve President Obama's broader trade goals while also putting more U.S. citizens to work to produce the added energy we send into those global markets," said Gerard. He urged Congress and the administration to work together on the issues.

"Just a week or so ago, the Obama administration clarified its position on the issue of condensate exports, and while it didn't change policy, it clearly sent a signal to the marketplace on what would be allowed and what might not. That is a positive step to make clear that we will allow this economic activity.

"But having done that, we need to take the next step and deal with our fundamental relic of the past back when we had a mindset of scarcity by recognizing that we now have rich abundance."

Gerard's arguments for gas exports via LNG include their potential global benefits of changing out coal and diesel use for natural gas in growing markets around the world that haven't had much access to gas supplies. The U.S. shale boom has now made it possible for the U.S. to have a broader impact on the world's response to climate change, he said.

"We are at a 20-year low in our carbon emissions in the United States, Gerard said. "Why is that? It wasn't a government mandate or legislation. It was driven by the increase in production of cleaner burning natural gas that was made possible by the American energy renaissance that we have today. That's what has gotten us to where we are today in reducing the amounts of carbon being released."

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