Owing to a combination of legal and policy restraints, as well as vociferous environmental objections, it is becoming increasingly difficult to gain approval from both federal and state bodies for new gas pipeline construction. For example, California, Washington and New England have proactive energy and environmental policies to encourage renewables, energy efficiency and energy storage, all at the expense of fossil fuels including natural gas generation.
Even with funding based on a thorough engineering definition, operators could still see a cumulative $111-billion cost overrun.
The growth in LNG production will depend on the availability of capital for construction of gasification export facilities and associated infrastructure alongside Asia’s rate of economic development and change towards a world of less carbon to combat global warming.
In sum, for the region’s gas exporters, on the one hand exports of LNG though costlier to transport, offer greater market flexibility and security than piped supplies. For gas importers, if local political tensions are resolved, piped natural gas is a very price competitive solution but LNG could still have a role in topping up supplies.
Saving the planet is a bit like picking fruit off a tree: it gets harder the farther up you climb…