The U.S. natural gas industry is jumping on the LNG export bandwagon as a way to get a higher price for the abundance of shale gas available in today’s markets. The recent announcement of a fully termed sale and purchase agreement (SPA) between Cheniere Energy and BG Group has fueled rhetoric around U.S. LNG exports from the Sabine Pass LNG terminal. It would be very informative to read that SPA. Price wasn’t mentioned in the press release, but it is invariably included in an SPA. Of course, this agreement could turn out to be a radical departure from the industry standard. Alberta Oil magazine had an interesting take on why such a deal will go through. The argument was based on the U.S. trade deficit. In 2009, the deficit was at $380.7 billion as noted by the U.S. Department of Commerce and the Bureau of Economic Analysis. Almost 54% of that was for petroleum and petroleum products. The magazine pointed out that the administration wants to cut that number down through its National Export Initiative. The shale gas flood will lead to even more export schemes. But, will Congress be willing to sell domestic natural gas to offset the cost of imported oil? The debate is just beginning. Brendan DeMelle, executive director, DeSmogBlog.com, is firing one of the opening salvoes against that argument. The headline on his Oct. 28 blog post read, “Massive Natural Gas Export Deal Inked by BG Group, So Much for Industry's ‘Domestic Energy’ Claims.” DeMelle is taking the natural gas industry to task. “The natural gas industry's favorite public relations ploy about the necessity of hydraulic fracturing (fracing), the process through which ‘clean natural gas’ is now procured, is that the patriotic gas industry is championing the shale gas boom for domestic consumption and for ‘national security purpose. We now know definitively that this is pure propaganda.” He pointed to the BG-Cheniere SPA as the “smoking gun” and another example of the oil and gas industry’s duplicity. “In other words, this is a totally different story than what the industry has told Americans about "home grown, domestic" energy. Little did the residents of the rural U.S. communities know, when the gas industry rolled into their communities a few years ago . . . that they were simply pawns in the industry's larger plan to export this shale gas to overseas markets.” The blog pointed to the three Canadian proposals in British Columbia and the four projects in the Lower 48. “So are we to expect that industry front groups like ‘America’s Natural Gas Alliance’ will now honestly discuss the fact that their claims to be patriotic champions of ‘domestic energy’ and promoters of ‘U.S. energy security’ are bogus? Not likely,” he concluded. That particular argument is likely to get some traction in the not too distant future. It all has to do with that pesky natural gas. About 25 years ago, an industry joke was about a company drilling for oil. The bad news was that they hit natural gas. Given the price of gas in the U.S., it is still bad news for a few companies. What will be the industry response when members of Congress from Florida and Massachusetts ask why they should open the offshore areas to drilling if the companies are going to ship natural gas to foreign markets? The industry faces a lot more questions about what to do with that natural gas. What happens if the low natural gas prices lead to increased demand and gas isn’t available because it is going overseas? Can the industry justify needing higher prices to continue tapping the shale gas resources? Will the transportation industry replace enough gasoline vehicles with natural-gas-fired cars and trucks to reduce imports? If LNG exports do begin, will the push to sell natural gas at the higher foreign prices drive up domestic prices? Will Congress let that happen? After all, being able to find markets for the excess natural gas would benefit the producers and the people that depend on that industry -- a perfect example of a trickle-down economy. But, it is the oil and gas industry. And a battle is looming over what Congress can take away from the industry, not what it will provide the industry. Contact the author, Scott Weeden, at sweeden@hartenergy.com.