Experts warn of “naive” LNG pause as House Hearing Highlights Education Ramifications

The indefinite U.S. LNG export pause by the Biden administration continues to raise experts’ eyebrows and spark reactions domestically and internationally. This week, JP Morgan CEO Jamie Dimon called the move “enormously naïve,” while a House Energy and Commerce field committee hearing highlighted the ban’s ramifications on education and workforce development.

JP Morgan CEO Jamie Dimon joined the long list of professionals raising the alarm over the export pause, taking aim at the ban done for what he called are “political reasons” to appease those who want to stop oil and gas development, a move he called “wrong.”

Meanwhile, on April 8th, the House Energy and Commerce Committee’s field hearing in Port Arthur, Texas highlighted the potential long term and irreversible consequences of the pause on the regional economy and education – specifically for the most disadvantaged communities.

Opportunities for the youth and education

At the hearing, Dr. Betty J. Reynard of Lamar State College in Port Arthur opened her testimony contrasting Port Arthur’s demographics with the national average, underlying what she argued are needed opportunities the LNG industry provides to the workforce in the area:

“[Port Arthur’s] per capita income is $24,065 and 27.6% of Port Arthur residents live below the poverty level. […] Only 11.4% of residents have a bachelor’s degree or higher while the national average is 34.3%.”

Reynard went on to explain that LNG industries support education in the Port Arthur region and fund scholarships. For example, Chenier LNG and Port Arthur LNG have recently donated funds to support an EDA Grant application by Lamar State College Port Arthur (LSCPA), and petrochemical plants in Port Arthur count LSCPA students amongst their interns. Bechtel, who is the contractor for Port Arthur LNG, provides Commercial Driver’s License (CDL) training to students, and partnered with Nederland High School on a welding program. LSCPA has about 200 majors relating to the petrochemical and LNG industries – only possible thanks to these different partnerships and the opportunity the industry provides.

Dr. Reynard explained that on average, manufacturing interns earn approximately $16 per hour and that these internships often evolve into full-time paid opportunities with incomes situated from $64,250 to $109,5403. LNG industries therefore provide economically disadvantaged communities with opportunities:

“LSCPA enrolls large numbers of educationally and economically disadvantaged students. Student profiles generally include descriptions such as socioeconomically disadvantaged, academically underprepared, first-generation student, and member of an at-risk ethnic group. The campus also has concerns that too many of our students experience homelessness, food insecurity, and general economic challenges. I frequently describe those challenges by reminding the public that LSCPA students are ‘one flat tire’ away from ‘dropping out’ or ‘stopping out’ of college.”

Supporting a national and regional economy

Beyond Port Arthur’s youth, LNG industries support the regional economy with direct employment and investment. For example, the Port Arthur LNG Plant employs 9,000 workers and the Golden Pass LNG plant employs 2,500. Not only do these plants create new jobs, but they also generate revenue through tax revenues and investments in infrastructure. Similarly, the contractors building the Port Arthur LNG Plant, by training LSCPA students, also provide income to the college. Therefore, limiting LNG activities in Port Arthur is perpetuating its existing poverty.

Using the example of Sabine Neches Navigation District, Rep. Randy Weber (R-TX) underlined that industries also support local governments in the maintenance and renovation of infrastructure.

“Sabine Neches Navigation District has been able to [increase] their local share sponsorship to 40 percent to encourage the federal to go ahead and dredge out some of their waterways.”

Similarly, Rep Weber made sure that the consequences of a pause were clear for workers:

“Is it true that or false that a pause means no income for construction workers?”

A point confirmed by Dr. Reynard.

In addition, as highlighted by Rep Morgan Griffith (R-VA), the LNG industries’ closure could lead to other jobs but from his experience: they do not pay as well. This point was confirmed by Larry Kelley, Executive Port Director and CEO of the Port of Port Arthur, who recalled the closure of some of Port Arthur’s refineries led employees to convert to lower wage jobs. Kelley also underlined that most businesses tied to energy and the LNG pause would have a chain reaction effect on other goods going through the port, with their own chain of supply and jobs – including paper towels, picket fences, aluminum, materials used for building homes, and export commodities such as wooden pallets.

Supporters of ban falsely state global consequences

Activist James Beard, Jr, Founder and CEO of the Port Arthur Community Action Network, falsely testified that the ban was welcomed by allies:

 “Contrary to the narrative of this hearing, President Biden’s pause has broad support both here and abroad. Our allies have told us that they do not want our gas.”

But this has been widely debunked with allies and experts raising the alarm about how the pause will affect their markets.

For example, in January, The New York Times published the opinion of several European experts in energy, namely Fredrik Persson, President of Business Europe, Didier Holleaux, President of Eurogas, and Henning Gloystein, Director for energy and climate change at Eurasia Group, who all expressed “a huge concern” regarding the Biden administration’s pause on LNG permits. They had explained the strategic role of U.S. LNG exports was to stop “Russia from forcing Europe down on its knees with using energy as a geopolitical weapon”.

Similarly, the Agence France-Presse reported research consultancy Rystad Energy’s analysis that “this pause will have longer-term implications, given the growth in demand for LNG beyond 2030” in Europe and Asia, where a rise in prices on global indices is not excluded. For Rystad, limiting LNG could even slow down the pace of the energy transition, to the benefit of coal.

Bottom Line: Experts continue to raise the alarm that U.S. LNG activities, particularly in local communities like Port Arthur are a crucial variable to success, economics, and social mobility. From workforce, education, national security, climate benefits and more, the indefinite LNG pause is harming key pillars of American prosperity.








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