SPONSORED CONTENT: U.S. shale boom offers security advantages
Author: Jared Wright - November 17, 2017 - Updated: August 1, 2018
The shale energy boom, which launched the United States to top spot in the world in terms of natural gas production, is presenting significant national security impacts, energy experts say.
The surge in domestic production, sparked by advances in hydraulic fracturing, have made the U.S. the world’s No. 1 producer of oil and natural gas since 2011.
While the U.S. still relies on imports of crude oil to fully meet domestic demand, experts say this trend suggests the U.S. will be far less dependent on imports from politically volatile regions of the world or potentially adversarial nations.
In addition to increased energy security, the new production is positioning the U.S. as a key natural gas exporter. According to a report issued by the U.S. Energy Information Agency, the United States became a net exporter of natural gas for the first time in 60 years in February. Additionally, the U.S. is on pace to challenge Qatar and Australia as the world’s top exporter of natural gas, according to a report released last summer by the International Energy Agency (IEA).
“The U.S. shale revolution shows no sign of running out of steam, and its effects are now amplified by a second revolution of rising LNG (liquified natural gas) supplies,” IEA Executive Director Fatih Birol told reporters in July. He added that the increase in American production was being met with a simultaneous increase in global customers for LNG. “The rising number of LNG consuming countries, from 15 in 2005 to 39 this year, shows that LNG attracts many new customers, especially in the emerging world.”
Global energy watchers say this ability to export vast quantities of natural gas can position the U.S. more favorably on the world stage and allow for greater opportunities to influence events.
With our own supply of oil and natural gas, we don’t have to rely on hostile, foreign regimes and war-torn regions to meet our energy needs.” — Jim Davis, 27-year veteran of the FBI and Former Chief of Public Safety for the state of Colorado
“It is difficult to fully appreciate how great a geopolitical advantage fracking has handed the United States,” says John Harpole, a Denver-based energy analyst and president of natural gas brokerage and research firm Mercator Energy.
Harpole says Lithuania serves as an illustration. Last month, the Baltic nation received its first spot shipment of U.S. LNG from Cheniere Energy’s Sabine Pass LNG terminal in Louisiana. Cheniere signed a deal with Lithuania in June to provide the country’s first direct imports of U.S. natural gas.
“Ninety-eight percent of Lithuanian natural gas comes from Russia,” said Harpole. “Like other Baltic nations, Lithuania would rather not be dependent on energy from a country that recently attacked and annexed the Crimea.
“U.S. natural gas offers them an option other than Gazprom (Russia’s majority state-owned natural gas company).”
Lithuanian officials confirmed that they had important strategic reasons for seeking U.S. gas imports. “This is crucially important for the whole region,” Lithuania’s Foreign Affairs Minister Linas Linkevicius told the Reuters News Agency after the inaugural delivery. “We want to cement our relationship with the United States in many aspects in addition to defense and security — energy trade is one of the strategic areas for cooperation.”
Other eastern European nations, nervous about Russia, could follow suit. Poland, for instance, also received its first U.S. LNG shipment this summer.
Harpole also points to other, often surprising new places the U.S. is suddenly exporting natural gas to, including oil-rich middle eastern nations. Beginning in March 2016, LNG from Sabine Pass has been shipping to Qatar and Kuwait.
Meanwhile, projects such as the Jordan Cove natural gas pipeline and LNG facility in Oregon promise to strengthen U.S. energy and security ties with Pacific Rim allies, particularly Japan, as those alliances face tough tests from North Korea.
“Even a cursory look at international events in the 20th century and up to the present day reveal how important control of energy supplies is in terms of geopolitics,” said Kelly Sloan, Energy Policy fellow at Denver’s Centennial Institute. “America’s security is enhanced significantly by the tremendous increase in domestic oil and natural gas production engendered by fracking, certainly by reducing our own dependence on overseas sources of energy, but also by enabling the U.S. to become an exporter. It provides the United States, and the West in general, a measure of strategic leverage we didn’t have before.”