Biden Pauses New Liquefied Natural Gas Exports

Happy Monday! After a pair of truly heartbreaking losses yesterday by the Detroit Lions and the Baltimore Ravens, the Super Bowl LVIII matchup is set. The happiest people this morning? San Francisco 49ers fans, Kansas City Chiefs fans, and NFL executives drooling over the marketing possibilities of Taylor Swift rooting on her boyfriend during the biggest game of the year. 

Quick Hits: Today’s Top Stories

• Three U.S. service members were killed and dozens more were injured over the weekend when an Iranian-backed militia—likely in Syria—launched a drone strike against a U.S. military installation in northeast Jordan near the Syrian border. President Joe Biden said Sunday that the U.S. would respond. “These service members embodied the very best of our nation: Unwavering in their bravery. Unflinching in their duty. Unbending in their commitment to our country—risking their own safety for the safety of their fellow Americans, and our allies and partners with whom we stand in the fight against terrorism,” he said. “[H]ave no doubt—we will hold all those responsible to account at a time and in a manner [of] our choosing.” While Iran-affiliated militias in the Middle East have launched more than 150 attacks on U.S. and allied troops in the region since Hamas’ October 7 attack on Israel, this is the first attack that has resulted in the deaths of U.S. troops.  
• The U.S., U.K., and Germany are among at least 11 countries that announced over the weekend that they were pausing funding to the United Nations Relief and Works Agency for Palestine Refugees (UNRWA) after allegations emerged that 12 of the U.N. agency’s workers participated in Hamas’ October 7 attack on Israel. Of the 12 staff members, nine have been fired, one is confirmed dead, and the identities of two have yet to be confirmed, according to U.N. Secretary-General António Guterres. The pause in funding only affects new obligations after January 24, not money allocated prior to that date, according to the State Department. The countries pausing their funding said they will wait for the outcome of the U.N.’s investigation into the agency to make final decisions about supporting the agency in the future.  
• Yemen’s Houthi rebels fired at the USS Carney, a U.S. Navy destroyer, in the Gulf of Aden on Friday—the first time a U.S. warship has been directly targeted since the Iranian-backed group began attacking ships in the Red Sea in October. “The missile was successfully shot down by USS Carney,” U.S. Central Command said. “There were no injuries or damage reported.” The U.S. conducted a strike on a Houthi anti-ship missile ready to launch on Saturday, the latest in a series of strikes on the Iran-backed militia. 
• Ukrainian security services said Saturday that they suspect five people—including some high-ranking members of the defense ministry—of involvement in a plot to embezzle $40 million in state funds meant as payment for 100,000 mortar shells that were never provided. The allegations are part of an ongoing struggle with military graft as the war in Ukraine approaches the end of its second year. 
• The Biden administration informed key lawmakers on Friday of its intent to sell Turkey $23 billion in updated F-16 fighter jets and Greece as many as 40 F-35 stealth fighters. The four leaders of the Senate Foreign Relations and House Foreign Affairs committees said they would not block the sales, effectively greenlighting the deal. The sale to Turkey had become functionally contingent on its decision to allow Sweden to join NATO, which Turkish President Recep Tayyip Erdoğan approved last week. 
• A New York jury awarded writer E. Jean Carroll a total of $83.3 million in damages—$18.3 million in compensatory damages and $65 million in punitive damages—from former President Donald Trump in her defamation case against him for statements he made denying that he raped her several decades ago. Carroll recently won a civil suit against Trump based on those allegations, with the jury awarding her $5 million. Trump, who left the courtroom before the verdict was read, will likely appeal the decision.
• The Justice Department found that former New York Gov. Andrew Cuomo sexually harassed 13 women employed by the state’s executive office and that his staff retaliated against at least four of the women he harassed. The findings emerged as part of a settlement between the DOJ and New York, which requires additional reforms from the governor’s office, including expanded independent reporting processes. Cuomo, who maintains he did not harass anyone, resigned in 2021 after New York Attorney General Letitia James found the governor had sexually harassed 11 women, some of whom were not state employees.
• Italian tennis player Jannik Sinner came from two sets behind Daniil Medvedev to win the Australian Open on Sunday, the 22 year old’s first Grand Slam title. In the women’s final, Belarussian Aryna Sabalenka defended her title on Saturday, defeating China’s Zheng Qinwen in straight sets and becoming the first woman in a decade to win two consecutive Australian Open titles.  

Turning Down the Gas

The U.S. officially became the number-one global exporter of liquefied natural gas (LNG) in 2023, surpassing Qatar and Australia and shipping out 91.2 million metric tons of the energy source across the globe. Growth has been explosive in the eight years since the U.S. began exporting LNG, but a new rule out of Washington could dampen those numbers.

The Biden administration announced on Friday that it would pause all approvals of pending applications for liquefied natural gas (LNG) exports in the name of achieving President Joe Biden’s climate goals. The move was cheered by environmental advocates and many of Biden’s allies on the left, while Republicans and industry groups warned the pause could hurt both the U.S. economy and European allies who have come to rely on American LNG amid the ongoing war in Ukraine. In an election year, Biden appears to be gambling that additional action on climate will light a fire under disaffected young voters upset with his support for Israel—and not blow up the status quo.

According to the Department of Energy, natural gas supplies roughly a third of the U.S.’ primary energy consumption. Liquefied natural gas simply refers to the gas that has been cooled to return to a liquid state, which makes it easier to store and, critically, ship. The U.S. currently has seven functioning LNG export terminals, with five more under construction. “None of that is going to be affected,” Energy Secretary Jennifer Granholm told CNBC on Friday. “All the stuff that’s under construction, that’s been authorized, none of that is going away. Certainly the stuff that’s being currently exported, there’s no impact.” But for any terminals seeking a permit, the future is now murky.

According to the Biden administration, the pause—and a systematic review of the process to bring new LNG exports online—is long overdue. “The current economic and environmental analyses DOE uses to underpin its LNG export authorizations are roughly five years old and no longer adequately account for considerations like potential energy cost increases for American consumers and manufacturers beyond current authorizations or the latest assessment of the impact of greenhouse gas emissions,” the White House wrote in a fact sheet describing the new policy. During the pause, the Biden administration will take time to analyze how LNG exports impact climate change as well as the economy and national security, and offered to bring approvals back online in case of “unanticipated and immediate national security emergencies.”

Ultimately, though, Biden cast the decision in stark terms, calling the decision to temporarily freeze the approval process for new LNG export facilities a matter of global importance. “This pause on new LNG approvals sees the climate crisis for what it is: the existential threat of our time,” Biden said in a statement released Friday. 

Despite the announcement, previously approved projects are still set to come online—two export facilities that will begin production this year are expected to contribute an additional 38 million metric tons of capacity. By the end of the decade, the Biden administration expects exports to double. And despite rhetoric from the White House supporting the phasing out of fossil fuels, the U.S. is producing more oil than any other country in history—13.3 million barrels per day, according to a recent report from S&P Global Commodity Insights. As recently as last year, additional projects were approved to further bolster domestic production.

Last March, the Biden administration greenlit the Willow oil project, which allowed developer ConocoPhillips to build three drill sites on federal land in the National Petroleum Reserve-Alaska. The Biden administration tried to argue that the project had been scaled back, and that it would be paired with strict limits on drilling in other parts of Alaska—but climate activists still took umbrage with the project’s approval. Friday’s LNG pause could represent something of a peace offering from Biden.

The biggest project potentially affected by Friday’s pause is energy startup Venture Global’s Calcasieu Pass 2, or CP2. Set to be built in the Louisiana Gulf, CP2 would be the largest export terminal in the U.S. Freezing this project, some climate activists argue, represents a political win that could help shore up a key group of voters. “Biden wants young people, who care about climate above all, in his corner,” environmental activist Bill McKibben, who has organized against CP2, wrote in a post on his Substack. “They were angry about his dumb approval of the Willow oil project in Alaska. CP2 alone would produce 20 times the greenhouse gas emissions of Willow.”

Climate activists were broadly supportive of the measure, and hailed the pause as a victory for Biden’s climate agenda. “This decision is a major win for communities and advocates that have long spoken out about the dangers of LNG, and makes it clear that the Biden administration is listening to the calls to break America’s reliance on dirty fossil fuels and secure a livable future for us all,” said Ben Jealous, executive director of Sierra Club. “Strong leadership, that rejects fossil fuel industry fear mongering, is our best bet to protect communities and ensure energy is affordable.”

But the proposal has faced plenty of criticism, too. Sen. Bill Cassidy of Louisiana and 25 other Senate Republicans, for example, sent a letter to Biden denouncing the move. “LNG exports are lifelines for our allies,” Cassidy tweeted. “Without them, European leaders will have to decide between depriving their citizens of energy or actively funding Putin.” In 2022, Russia ranked fourth in global LNG exporters, well behind Qatar, Australia, and the U.S.

Mike Sommers, president and CEO of the American Petroleum Institute, which advocates for the oil and gas industry, also argued the LNG export pause represented a win for Russia. “This is nothing more than a broken promise to U.S. allies,” he said in a statement, “and it’s time for the administration to stop playing politics with global energy security.”

Even some members of the president’s own party believe the issue is an electoral loser. Former Rep. Tim Ryan, a Democrat from Ohio, said “the D’s have just put themselves squarely on the wrong side” of the issue in a heated election year. “LNG has helped us totally displace coal & make major reductions in CO2,” he tweeted. “You’ll hear lots of this in NV and PA and MI and WI and AZ. Walked right into it!”

Former President Donald Trump—Biden’s likely opponent come November—wasted no time in making the latest climate proposal an election issue. “Biden blocked the export of American natural gas to other countries, you know he doesn’t want—he doesn’t want plants built in the United States, even though that’s the best thing you could do,” Trump said at a rally in Nevada on Saturday. “I will approve the export terminals on my very first day back.” Even before Biden’s announcement, Trump had made energy production a core part of his campaign, promising to “drill, drill, drill” on day one.

Eliciting an election-year fight—and drawing attention to a key difference between himself and Trump—might have been part of Biden’s calculus in considering the LNG pause. “While MAGA Republicans willfully deny the urgency of the climate crisis, condemning the American people to a dangerous future, my Administration will not be complacent,” Biden said in the statement announcing the policy. “We will heed the calls of young people and frontline communities who are using their voices to demand action from those with the power to act.”

Only time will tell if Biden’s LNG export pause is a winning campaign issue—which could ultimately decide the proposal’s fate. Secretary Granholm has said the review of the permitting process will take “some months.” By the time the Biden administration’s fact-finding mission is complete, voters will likely have already issued their verdict on Biden’s climate policies.

Worth Your Time

• In a visually rich explainer complete with detailed maps, David Sacks of the Council on Foreign Relations broke down why China would have a difficult time invading Taiwan, should it choose to do so. “China is investing huge sums to develop the capability to bring Taiwan under its control by force, if need be,” Sacks wrote. “At the same time, invading Taiwan or mounting a successful blockade would be the most complex military operation in modern history, and China’s military has not fought a major war in more than seven decades. To invade Taiwan, China would have to conduct an extraordinarily complex military operation, synchronizing air, land, and sea power as well as electronic and cyberwarfare. The Taiwan Strait, over ninety miles wide, is incredibly choppy, and due to two monsoon seasons and other extreme weather events, a seaborne invasion is only viable a few months out of the year. Transporting hundreds of thousands of soldiers across the Taiwan Strait would take weeks and require thousands of ships. Each crossing would take hours, allowing Taiwan to target the ships, mass troops on potential landing sites, and erect barriers. Taiwan has inherent advantages that will make an invasion difficult, expensive, and uncertain. Still, the Taiwanese people’s will to fight and resist will likely prove more decisive than mountains, ports, roads, or the ocean. If China conducts the operation with little opposition, it can probably navigate and overcome those obstacles. However, if confronted with millions of people determined to repel an invasion, China will face a much tougher task.” 

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Toeing the Company Line

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• On the site today: Kevin Corinth makes the case against the child tax credit, and Thomas Harvey and Thomas Koenig argue that doing away with the Chevron doctrine won’t magically fix Congress. 

Let Us Know

Do you think the Biden administration’s liquefied natural gas pause represents a good-faith policy proposal or a campaign talking point?