Back in 2007 the United States was in store to get about 130 metric tons of liquefied natural gas (LNG) imports. However, North American shale gas plays have changed all that. But if hydraulic fracturing (fracking) well stimulation is outlawed or severely curtailed, it could be back to the future where LNG imports are concerned.

“…[I]n 2007 there was expected to be 130 metric tons of LNG coming to the United States. The reality is all of that is now going somewhere else,” ConocoPhillips Gas & Power’s James Duncan, director of market analysis, told a Houston audience recently. “The point at which fracking is not allowed will send us back immediately to 2007 supply-demand fundamentals. And if you remember, we needed that 130 metric tons of LNG. We needed every gas well we had…”

Regulation of fracking practices that are conducted above ground is coming, said Wood Mackenzie’s Ed Kelly, vice president of North American gas and power, who along with Duncan spoke at the Argus Shale Liquids & Gas Summit in Houston.

Kelly said industry will likely find this regulation “bearable and doable. It’s very surmountable,” he said. “We don’t see that slowing the Marcellus [Shale] down.”

As for regulation of below-ground fracking, Kelly said the perception of the threat of regulation is becoming a factor in and of itself. “Producers can bear a fair amount of costs,” he said. “But I think it is in that realm of perception…that perception becomes a reality all by itself.”

Industry has been working to maintain a seat at the table where shale patch regulation is concerned. Recently, American Petroleum Institute CEO Jack Gerard said regulation of the nation’s shale gas plays would best be handled by state government and cautioned against involvement by the U.S. Environmental Protection Agency (see Shale Daily, May 5).

If the United States does end up relying more heavily on imported LNG — whether due to a curtailment of shale gas development or a spike in gas demand — there will be plenty of coastal regasification capacity available to handle incoming cargoes (see chart).