Liquefied Natural Gas: Redefining Nature, Restructuring Geopolitics, Returning to the Periphery?

Abstract

AbstractThe liquefied natural gas (LNG) industry began as a means of making use of natural gas resources in socially remote regions and of natural gas associated with oil production. Natural gas was transformed from a waste product into LNG that could be moved thousands of miles to market, redefining “waste” as a valuable raw material. As the newest large‐scale LNG exporter, the United States entered the LNG industry based on another redefinition of nature: the extraction of natural gas previously economically and technologically inaccessible in shale formations. Hydraulic fracturing and new drilling technologies have created reserves of natural gas that are driving down prices with excess production and provoking a search for new markets via LNG exports. Liquefied natural gas is reshaping economies, communities, industries, and ecosystems in the United States and in other parts of the world.This article analyzes the role of the LNG industry with a particular focus on the economic and geopolitical consequences for the United States. The United States is returning to its historical role of energy exporter. Some view the return to this role as an economic and geopolitical boon that will enhance the U.S. economy and the nation’s global standing. A contrasting interpretation sees the United States sliding into the extractive periphery, serving the energy demands of a growing China, much like the United States once did for Europe and especially Great Britain. This view condemns what it views as the exploitation of U.S. natural resources to meet China’s energy needs while leaving large areas of the United States with depleted resources, damaged ecosystems, and disrupted communities.