Qatar and the United States have further strengthened bilateral trade ties as the US Department of Energy approved Golden Pass, an international energy company, to export Liquefied Natural Gas (LNG). Golden Pass, a joint endeavour between US energy giant, ExxonMobil and ConocoPhillips (which holds a 30% stake) and Qatar Petroleum (which holds a 70% stake), will invest an estimated $10 billion in improving and modernizing current US infrastructure. This effort would allow the US access to international LNG shipping lanes and terminals.
Golden Pass’s existing facilities, in Jefferson County, Texas, will play a crucial role in expanding the US footprint in the global energy market. Currently, Russia, Qatar, and several other nations dominate the Liquefied Natural Gas (LNG) market.
This venture will allow the US to enter the already dominated LNG market, taking advantage of recent technological advances in oil fracking, in a formidable partnership with Qatar. Natural gas in the US has been produced as a by-product of hydraulic fracking and has been usually wasted in the past. Qatar’s involvement in the project, through its position as a seasoned exporter and producer, would bring invaluable expertise to US producers that would be able to export two products rather than just one.
US producers are just arriving onto the Natural Gas market and face stiff competition. Qatar’s experience and relationships in the LNG export business will be able to shorten or even eliminate the learning curve for US companies. In doing so, US exporters are able to gain further profits in conjunction with their oil exports.
The Department of Energy authorization will allow additional infrastructure to be established in Florida, Louisiana, Texas, and Georgia that are estimated to create 45,000 US jobs in the coming years. The initiative will also allow local and federal governments access to additional revenue, with Golden Pass estimating that it will have to pay around $2.4 billion in federal taxes and $1.2 billion in state taxes.
This venture will also strengthen the US trade deficit as the new authorization will allow Golden Pass to export 6.2 million cubic meters of natural gas. US Secretary of Energy, Rick Perry, stated:
“This is not only good for our economy and American jobs but also assists other countries with their energy security.”
(Image Source: Fuel Fix)