[Congressional Record Volume 160, Number 107 (Thursday, July 10, 2014)]
[Senate]
[Pages S4414-S4417]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. HOEVEN (for himself, Mr. McCain, Ms. Murkowski, and Mr. 
        Barrasso):
  S. 2592. A bill to promote energy production and security, and for 
other purposes; to the Committee on Energy and Natural Resources.
  Mr. HOEVEN. We are here today to talk about energy--energy for our 
country but also energy for our allies. This is a discussion not just 
about energy, it is about jobs, good-paying jobs. It is also about 
economic growth. It is about generating tax revenues to help reduce the 
debt and the deficit without raising taxes. It is about national 
security--not only our national security but also working with our 
closest friend and ally, Canada, as well as our allies in Europe, the 
European Union, and working to help countries such as the Ukraine that 
very much need energy supply from sources other than Russia.
  With the current events going on in the Ukraine, it is very clear 
that we need to play a long-term game, a long-term strategy--deploy a 
long-term strategy when it comes to helping our allies, not only in 
terms of our national security but working with our allies to make them 
stronger, their strength, their national security. The national 
security of allies also contributes to our strength and our security 
here at home. So that is what we are here to talk about. We are here to 
talk about the North Atlantic Energy Security Act, legislation we are 
introducing today--myself, Senator Barrasso, Senator McCain, and 
Senator Murkowski.
  I am going to take a few minutes to talk about energy production, 
transportation, and export in terms of building our energy future in 
this country and working with our allies. Senator Barrasso is here, and 
he will be talking about the specific legislation. Senator McCain will 
join us as well to talk about the national security issues and 
implications.
  I will start with the first chart.
  Very simply, what we want to do is continue to produce more energy in 
our Nation, in the heartland of our Nation and throughout our country. 
We want to transport that increased production to market. That includes 
not only markets domestically but also markets where we can export it 
to our friends and allies in the European Union, to the Ukraine, and to 
Japan. That is the simple equation we are working on. Again, it is 
about energy. It is about jobs. It is about a growing economy. It is 
very much about national security.
  That gas is produced throughout our country, more and more all the 
time. Right now we produce 30 trillion cubic feet of natural gas a 
year. We only use 26 trillion cubic feet of natural gas a year, so we 
are already producing more than we consume, and that number is growing.
  What happens when you produce more than you consume and you do not 
have a market for that gas? In places such as North Dakota, we are 
flaring off that gas. Right now, just in my State alone, we flare $1.5 
million a day of natural gas--$1.5 million a day. That is natural gas 
that we need to capture, that we need to get in gathering systems, that 
we need to transport to markets, and we need markets for that gas. This 
is just common sense.
  How do we move gas from North Dakota to places such as Ukraine, where 
there is much need for a market? Well, we need both interstate and 
intrastate pipeline systems. On this chart, you can see that the purple 
is the interstate. That is how we move gas across State lines. But we 
also need intrastate gathering systems. A lot of oil wells produce 
natural gas as a byproduct; other wells are just gas wells. But you 
need gathering systems, the blue systems that go to all those wells so 
that gas can be gathered, put in the interstate system, and moved to 
markets--markets throughout the United States and markets overseas.
  As I said a minute ago, we produce 30 trillion cubic feet a year, 
States such as North Dakota, Wyoming, and many others. That number is 
growing. We produce 30 trillion cubic feet a year, but we only consume 
26 trillion, so we are flaring off that gas.
  We need markets. As we work to build those gathering systems and 
those interstate pipelines, how do we get markets? Well, we move that 
product to overseas as liquefied natural gas, LNG. It is cooled and 
condensed, put on ships, and moved to other markets--the European 
Union, Ukraine, Japan--by ship. But we need the LNG facilities to do 
it. We do not have them. So that is a problem, right? Well, it is, 
except we have many companies that are not only ready and willing but 
anxious to build the facilities. Here are 16 right here, 16 
applications.

  Of the 26 applications that are pending, many of them have been 
pending for over a year waiting to get approval from the Department of 
Energy and from the FERC. So here we are flaring off natural gas, as I 
showed a minute ago--$1.5 million a day in my State--flaring it off 
because we produce more than we consume. We need markets. These 
applications are just sitting there and have been for more than a year.
  If they get approved, what happens? Let's take an example. Here is 
one by a company everybody has heard of--Exxon. Exxon has an 
application. As you can see here, they have had an application in for 
over a year waiting to get approved at Sabine Pass, TX, which is right 
down in that gulf area. They are ready, willing, and able to spend $10 
billion right now, today, to build that facility.
  Where are they going to move the gas? They are going to move it to 
the United Kingdom so it can go right into the European system. We will 
touch on that European system and how it gets to places such as the 
Ukraine in a minute. But if they can get approval--

[[Page S4415]]

I have already talked to their CEO, Mr. Rex Tillerson. He indicates 
that within 36 to 40 months of approval, they can be moving gas into 
the European markets. Does that sound realistic? It certainly does. 
Obviously that is a very large company with the capabilities to do what 
they say they are willing and want to do.
  Here is another example. Here is Cheniere. Same place--Sabine Pass. 
This is one that did get approved. This is one that did get approval. 
They intend to be delivering gas into the European market by the middle 
of next year--middle of next year. So this is not something that is 
going to take forever to happen.
  We not only have the fact that we can start moving natural gas over 
here in a very reasonable amount of time, but think of the impact on 
the markets in Europe and the impact on Russia and gas prices when they 
know it is coming.
  I am going to ask Senator McCain to step in here. I mentioned a 
minute ago that application I showed you that is pending from Exxon. 
They want to move that natural gas to market right here in the UK.
  What this chart shows is the pipeline network throughout Europe that 
will enable them to move that product throughout Europe and even into 
Eastern Europe, including places such as Ukraine.
  Right now where is all that gas coming from? Russia, Gazprom. All 
these pipelines are coming down from Russia and providing that gas to 
the European countries, to the European Union, and to the Ukraine. Of 
course, that makes them dependent on Russia and that enables Russia to 
engage in the kind of activity we have seen and we can't always be 
reacting short term. We need a long-term strategy to break that hold.
  Here are some of the numbers. This shows not only Ukraine but look at 
the impact on other NATO countries, Lithuania, Estonia, Latvia, 100 
percent of their gas coming from Russia. Think of the leverage that 
gives Russia in this situation.
  The last chart is the North Atlantic Energy Security Act. Quite 
simply, we are going to cut the redtape that is holding up production 
and infrastructure, we are going to reduce flaring, and we are going to 
expedite LNG to our friends and allies, to countries such as the 
European Union, to Ukraine, to Japan. We reduce the redtape that is 
holding up production. We are producing 30 trillion cubic feet of 
natural gas, and we can produce a lot more, but we have to cut through 
the redtape. We also enhance and expand our ability to build the 
gathering systems that move that natural gas to market, and we allow 
export.
  We have an expedited process so we can export that gas to the markets 
we need, to our friends, and to our allies. Again, this is about 
energy, but it is about creating jobs, it is about growing our economy, 
it is about the national security of our country and our allies, and it 
is about having a long-term strategy that works, not going from crisis 
to crisis.
  With that, I turn to my colleague, the senior Senator from Arizona, 
to comment on some of the national security implications.
  Mr. McCAIN. I ask unanimous consent the colloquy between the three of 
us be allowed.
  The PRESIDING OFFICER. Without objection.
  Mr. McCAIN. I thank my two colleagues from North Dakota and Wyoming. 
There are no two Members of the Senate who know more and have worked 
harder on this energy issue. There are no two Senators who have worked 
harder to try to bring to the American people the fact that if we could 
export energy to these countries, it could literally change the world. 
This is not only when it actually arrives, but when Vladimir Putin gets 
the message, within 3 years--as I understand the Senator from North 
Dakota's context--we could be sending energy to the living rooms.
  If you would put the numbers back up with the countries and their 
dependence on Russian energy.
  Within 3 years the people within Latvia, Estonia, members of NATO, 
would no longer be reliant--and it gets very cold up in those Baltic 
countries as well. It can have a significant effect on the entire 
world.
  I would also point out if that energy--and I would ask my colleagues 
from Wyoming or North Dakota--could get to the living room of Kiev--
which the Senator showed the different pipelines that cross Ukraine--
that has a huge effect.
  I would ask my friend from Wyoming to comment.
  We have threatened Russians time after time after they absorbed 
Crimea in violation of an agreement they made in Budapest to respect 
the territorial integrity of Ukraine. They absorbed Crimea. They 
continue to provoke unrest in Eastern Ukraine.
  They have been threatened time after time by the United States and 
Europe, and I would argue that the handful of sanctions on individuals 
has had very little effect whatsoever on Russian behavior.
  I ask the Senator from Wyoming as well, this is not only about the 
fact that the United States of America would be an energy exporter--
which is a huge effect on our economy--but this could have a huge 
effect on the entire European Continent, because if Vladimir Putin 
understands that this energy is coming from a friend of the ally of the 
United States America, as opposed to them being dependent on Russian 
oil and energy, I would argue that it could change the entire shape of 
the world as we know it.
  I thank both of the Senators who have been involved in this issue for 
many years. I don't know how many times both Senators have come to the 
floor--and I might just say I don't claim to be an expert on energy as 
my two colleagues are--but I will say the presentation the Senator from 
North Dakota just made should be understandable and I believe is 
understandable to every American citizen how we can, within 3 years as 
I understand it, achieve a level of energy independence and that for 
Europe that could literally change the entire equation in Europe and in 
the United States.

  Mr. BARRASSO. My friend and colleague from Arizona is absolutely 
right. The three of us have traveled together to Ukraine. We have 
traveled together to Latvia and Lithuania.
  What we hear everywhere we go is: Please sell us natural gas. Please 
sell us energy. Please help us undermine what Putin is doing to us.
  Energy should be used as a geopolitical weapon, and it is the 
advances in technology in just the last decade that have made all of 
this possible. The Senators from Arizona and North Dakota are both 
correct. We are producing more now than ever. They are well aware of 
that throughout Europe and throughout the Baltics--to the point that 
Lithuania is even in the middle of acquiring an at-sea platform to 
change liquefied natural gas into natural gas--to warm it up, if you 
will, for use--and it is called the Independence. That is the name of 
this platform. It is to give them independence from Russia.
  That is what they are investing in, and now they are saying to us: 
Please send it our way.
  The technology has changed so much that in 2005 a book came out 
called ``Beyond Oil,'' and it was sent to every University of Wyoming 
first-year student coming in. They were invited to read it, and there 
was a whole section on liquefied natural gas.
  At the time the technology wasn't developed enough for us to be so 
blessed in the United States to produce it, so that they were talking 
about actually building terminals in Louisiana, Texas, to import 
liquefied natural gas from other places.
  Now we have reversed it. We are now in a position where we have such 
an abundance of liquefied natural gas, as my colleague from North 
Dakota said, we are flaring it off, burning it to the point of $1.5 
million a day. That is the value of that gas, and there is also tax 
revenue that is not being collected because this isn't being sold, so 
our States could use the revenue. The Federal Government would benefit 
from us selling this rather than burning it, but yet we don't have the 
opportunity to do so because of the specifics of the laws with which we 
are faced.
  We need to change the law. We need to be able to export. We need to 
be able to have permits to export, and we are seeing a lot of foot-
dragging by this administration, which is why there are bills on this 
floor, bipartisan pieces of legislation, to help us use our energy 
abundance as a geopolitical weapon to

[[Page S4416]]

undermine Vladimir Putin's ability to use energy as a weapon of his 
own, a club against, as we have said, Ukraine, Moldova, Latvia, 
Lithuania, Estonia--all of these areas that are so dependent upon 
Russia for their gas, when they would rather buy it from us.
  It would be an opportunity for us in America to become a net exporter 
in a way that would help balance our trade and balance our payments. It 
would bring cash back into the United States and we would be so much 
less dependent on the Middle East for sources of energy. We should be 
relying on that at home.
  I look to my colleague from Arizona and say he is absolutely right in 
his leadership, in his direction, and in his global view that he has 
seen in his incredible service to our country. He has seen the shift. 
He has seen the future, and he knows the future success for our country 
comes in exporting liquefied natural gas to Europe, to our NATO allies, 
to Ukraine.
  That is why we bring to the floor today the North Atlantic Energy 
Security Act, which we believe will help our country, help globally, 
and help us not just economically but help us geopolitically as well.
  I turn to my friends from either Arizona or North Dakota to continue 
in this discussion, and then I will get back to some specific things 
that are happening around the world.
  Mr. McCAIN. I say to both of my colleagues, the Senator from North 
Dakota, Americans understand, I believe, that we need to do what we can 
to help our European friends become independent of Vladimir Putin as a 
source of energy.
  They also are beginning to understand the United States of America is 
going to be an exporter of energy, which will obviously change our 
dependence on Middle Eastern energy and on other forms of energy, but 
the way the Senator from North Dakota described this, I think every 
American, if they saw it, would ask: Why don't we move in that 
direction? Why don't we believe the major energy companies that say 
within 3 years--and beginning, I understand, next year with some of 
them--we could be supplying these countries with energy which would 
then give them not only the ability to have energy without dependency, 
but it also sends a huge message to Vladimir Putin and to Europe that 
they are no longer dependent on his largesse. There have been times in 
the past where Vladimir Putin has shut off the energy in the 
wintertime, and it gets very cold in some of these countries in the 
wintertime.
  It might also send a message to Vladimir Putin himself that he is not 
going to get away with the kind of behavior that he has.
  I would ask the Senator from North Dakota, what does it require--
suppose I am just an average citizen--to capture that natural gas that 
is being burned for $1 million-plus a day? What does it require to 
capture that and then get it to that port where it is going to be 
exported?

  I would finally say I intend to go every place I can in America in 
the next few months and give the same presentation the Senator from 
North Dakota did and help the American people understand that we don't 
have to do a lot.
  The energy is there. The question is, Do we have the national will 
and legislative will to take the action necessary to get that energy to 
the people who need it so badly, who are literally under the threat of 
freezing cold this coming winter?
  Mr. HOEVEN. I thank the Senator from Arizona for his comments, his 
leadership, and for his willingness to work on this vitally important 
issue.
  In terms of responding to his question: OK. What needs to happen--I 
wish to take a minute to give an overview of the legislation and then 
ask the Senator from Wyoming to comment in more detail.
  As I said at the outset, and I actually have said several times, this 
is about more energy, it is about job creation, it is about growing the 
economy, and it is about national security.
  It is also very much about environmental benefits. I showed you gas 
being flared off a well. This gas is just being flared.
  Not only is that wasting a natural resource which we can capture and 
get value for, but when we capture that, we also create environmental 
benefits.
  Nationally, we flare or vent, burn off, 212 billion cubic feet of gas 
a year--212 billion cubic feet of gas a year now being burned off.
  Mr. McCAIN. Which is roughly how much money?
  Mr. HOEVEN. Oh, boy. To convert it, it is billions, right, it is in 
the billions of dollars. I don't have the exact number, but it is a 
huge amount. It is $1.5 million a day in my State alone so the Senator 
can see we are talking billions of dollars. There are also tremendous 
environmental benefits as well.
  But let's go to the legislation for a minute because I think this is 
responsive to the question asked by the Senator from Arizona about: OK. 
How do we make it happen?
  The reality is we are producing the energy now, we can produce more, 
and this doesn't cost taxpayer money.
  This creates revenues without raising taxes. This is going to create 
revenues to help address the debt and the deficit. This is enabling and 
empowering the private companies to make investments to create jobs, 
make investments to produce the energy.
  Going back to this chart, Exxon wants to invest $10 billion today, 
creating thousands of jobs and a tremendous amount of revenue for the 
Federal Government to reduce the deficit and debt. It doesn't cost a 
penny. That is not what it is about. It is about streamlining the 
regulation, cutting the redtape. That means making sure we streamline 
and expedite the process to get wells approved. That is the first area 
of legislation that increases our production onshore. We can do it 
offshore as well. But we are talking about more production. As I say, 
we are already producing more than we consume.
  Second, it is about building those gathering systems. It requires 
permits and approvals to build gathering systems, so we are not able to 
build those gathering systems. If you can't build a gathering system, 
what happens? You burn off the gas because you can't get it to market. 
So that process is being held up. Again, it is about cutting through 
the redtape, reducing the regulation and bureaucracy. It doesn't cost 
anything.
  The final piece, the same thing--getting approval to export LNG. 
Right now there is one that has final approval from the DOE and FERC. 
There are 26 applications pending. One has final approval from the 
DOE--Department of Energy--and the FERC. Six have conditional approval 
and 26 are pending. It is as simple as getting the approvals and 
cutting through that redtape. This is not about spending taxpayer 
dollars; it is about generating revenues.
  Mr. McCAIN. If I could ask the Senator from North Dakota one 
additional question, and maybe the Senator from Wyoming would comment 
on it too. What about the environmental aspects of using natural gas as 
opposed to other forms of energy, whether it be coal or oil or other 
forms of energy?
  Mr. HOEVEN. I would respond briefly to the Senator from Arizona and 
then turn to the Senator from Wyoming on that issue as well for more 
detail on the legislation. He has tremendous expertise in this area and 
has been working on it for a long time.
  Clearly, it is a double win because not only are we no longer burning 
off or flaring that natural gas, but we are using natural gas, which is 
a very clean resource, for a whole range of energy uses, whether it is 
powering homes or many other uses. So it is a huge environmental win.
  Mr. McCAIN. So I would think the EPA would be out there in front 
arguing for this legislation.
  Mr. HOEVEN. Absolutely an environmental win.
  Mr. BARRASSO. It is interesting. The Senator from South Dakota, the 
Senator from Arizona, and I were reviewing this article in today's Wall 
Street Journal, Thursday, July 10.
  The headline is ``In the Arctic, Shipping Route Is Set to Supply LNG 
to Asia,'' and there is a map of the globe. It says:

       Shipping companies in China and Japan said they would start 
     a regular service to carry Siberian natural gas across the 
     Arctic Ocean to East Asia, showing how Asian demand for the 
     fuel is reshaping global shipping routes.

  So with the forces at play--Asia's demand for natural gas, Japan's 
move

[[Page S4417]]

away from nuclear power, China's struggle with pollution--this is an 
opportunity for us to use a resource we have in the United States and 
export it in a very profitable way for our country, put people to work, 
increase tax revenues to the States, increase tax revenues to the 
Nation, and improve our balance of trade. The technology is now 
allowing us to do it, but the government is not. That is the biggest 
problem we have--a bureaucratic Federal Government that is not allowing 
what we have and what we have learned to use. The government is 
blocking it, and that is why we have come to the floor today to try to 
encourage additional exports to Europe and support the North Atlantic 
Energy Security Act.
  Mr. HOEVEN. Madam President, I turn to the good Senator from Arizona 
for any final comments. Seeing that he doesn't have any, I thank him.
  I also thank the good Senator from Wyoming and ask if there are any 
final comments he might have on the legislation. He has been an author 
of much of this legislation. I thank him for that tremendous work and 
for being part of this effort.
  Mr. BARRASSO. The legislation is bipartisan. We have Republicans and 
Democrats alike who realize there are incredible values to us as a 
nation to be exporting liquefied natural gas.
  At a time when the technology is there, the will is there, we need to 
get a vote on the Senate floor. I offered the amendment before and 
bring it again today as legislation, the North Atlantic Energy Security 
Act. It is about energy, it is about security--our economic security, 
our energy security--and our opportunities on the geopolitical stage to 
use our resources to the best advantage of our Nation and our Nation's 
citizens.
  I thank the Senator from North Dakota for his continued leadership in 
this area.
  Mr. HOEVEN. I thank the Senator from Wyoming.

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