The more natural gas America exports, the greater the economic benefits for the country, according to a federally backed study released Wednesday that could be key in whether the government issues export permits to gas companies clamoring for them.
The news of the study's conclusions cheered gas companies but raised concerns among manufacturers and consumers who could pay higher prices if exports gobble more of a plentiful supply of gas.
"Once (gas companies) get a new market with higher prices, it certainly benefits them," said Bill Stewart of the Keystone Energy Forum, which the American Petroleum Institute funds. "I think what they'll do is invest in more drilling. They have a ton of acreage under lease that they haven't touched yet."
The question of whether to allow large-scale natural gas exports has been a flash point between American drillers who want to sell more gas and American manufacturers and consumers who want a cheap supply. The federal government delayed decisions on more than a dozen requests for export permits in part while it waited for the results of the Department of Energy-commissioned study.
Dominion Resources Inc. touted the study as a sign that benefits will be disproportionately high in Maryland and the Middle Atlantic states. The company owns a terminal on the Chesapeake Bay that is on the list of export permit requests and says exporting will help spur jobs there and at drill sites in and around Pennsylvania connected by the company's transmission pipes.
"That was our logic all along. We're just glad the study confirmed that," Dan Donovan, the company's Pittsburgh-based spokesman said. "It's a significant landmark."
The economy would benefit from any level of exports, and unlimited exports would represent the best scenario, the 215-page report from NERA Economic Consulting found. Americans would benefit from cash coming in from overseas buyers and increased payments to landowners who own and lease their gas rights, the report said.
The downside of exporting gas would be an increase in price, estimated at between $0.22 to $1.11 per thousand cubic feet after five years of exporting. …