The U.S. House of Representatives passed the FY17 National Defense Authorization Act (NDAA), which authorizes $602 billion in funding for the Department of Defense and the national security programs of the Department of Energy. While defense spending has little effect on the oil and gas market compared to other factors, there was a provision in the bill that will affect the oil and gas market in the U.S.

The bill included a measure to streamline the permit process through the Department of Energy to export LNG. The passage of the bill allowing LNG exports opened the door to the U.S. entry into the global natural gas market, and this NDAA bill just pushed the door open even wider. A streamlined approval process would allow American LNG to enter the European Market, loosening Russia’s grip on energy supplies and prices.

The American Petroleum Institute released a statement commending the House on the passage of this legislation. “U.S. LNG exports will create American jobs, significantly strengthen the global energy marketplace, and bolster our strategic alliances,” said API Executive Vice President Louis Finkel. “Today’s action by the U.S. House of Representatives to approve LNG exports provisions as part of the defense authorization bill further cements the critical role U.S. energy plays at home and abroad.

“It’s time for our nation to fully embrace the vast economic and geopolitical opportunities unleashed by the energy renaissance. U.S. LNG exports ensure that consumers across the globe have access to stable, diverse energy supplies, protect America’s role as a global energy leader, further enhance national security in the homeland and help our allies break dependence on nations that use their energy resources as a political weapon,” API’s Finkel said.

U.S. LNG exporter Cheniere Energy (ticker: LNG) shipped its first LNG cargo to Europe from its Sabine Pass LNG export facility in Louisiana in April of this year. The company is targeting first cargo from Train 2 at Sabine Pass in mid-August.


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