Energy Secretary Chris Wright, a fracking millionaire, grifter, and wannabe oligarch, purchased his cabinet seat with a million dollar donation to the Trump campaign, and is working it hard to the best advantage of himself, his industry cronies, and wealthy oil/gas tycoon donors.
A big promise of the American shale-drilling boom was cheap, plentiful natural gas that would give U.S. manufacturers an edge against global competitors.
Fifteen years in, U.S. gas production continues to reach new highs, the country has become the world’s largest exporter of liquefied natural gas and yet domestic manufacturers say they are increasingly cut off from fuel during the coldest winter days.
As frigid weather swept over the mid-Atlantic region late last month, Evonik Industries’ EVK 1.01%increase; green up pointing triangle plant in Havre de Grace, Md., received notice from its local utility: Shut off the gas or risk huge financial penalties.
In many parts of the country, there isn’t enough pipeline capacity to guarantee manufacturers a flow of gas when heating and cooling demand surges. That doesn’t happen to power plants and homes, where gas is needed to keep people from freezing. Nor are firms that ship gas to overseas buyers cut off, thanks to long-term supply deals guaranteeing them space on pipelines.
Workers at the Evonik plant were dispatched to close the gas supply valve into the factory, where the German chemical maker produces silica for toothpaste and food products.
Without gas for its manufacturing process, the plant ceased production. Emergency heaters were fired up so equipment didn’t freeze. Workers were assigned maintenance tasks until the gas could flow again. The outage lasted seven days.
“It literally goes into mothball mode,” said Len Kientz, Evonik’s director of energy management in North America. “It really hurt because we lost a week of production time.”
Soaring on-the-spot gas prices hit Evonik facilities in Illinois, Indiana, Tennessee and Nebraska this winter, too.
International Paper, the country’s largest producer of corrugated packaging, said its containerboard mills and box plants have been plagued by gas availability issues.
Several of its box plants in Texas were without gas for days during last month’s winter storm. Others only were able to keep running because the company paid prices for on-the-spot gas that had surged to several times the typical price. The company has had to truck fuel oil to one of its mills, which has been without gas since Jan. 23.
“There is a huge concern within the industrial sector that we are the lowest priority for gas supply and are curtailed first,” an International Paper spokeswoman said.
Pipelines curtailed or otherwise restricted the flow of gas to manufacturers more than 40 times last year, said Paul Cicio, chief executive of Industrial Energy Consumers of America, a trade group with members that operate more than 12,000 U.S. manufacturing facilities. “This year it’s going to be that or worse,” he said.
Cicio said his tally doesn’t include the manufacturers that wind down when high gas prices render their operations unprofitable. On-the-spot gas deliveries at trading hubs in areas hardest hit by the recent winter storm shot to some of the highest prices on record.
In New York, gas rose to nearly $150 per million British thermal units from around $3. In New England and Chicago, a million British thermal units topped $80 and $40, respectively. Prices spiked similarly along supply routes in the Southeast and up the Atlantic Coast. Although prices fell back almost as fast as they rose, gas in some areas remains several times more expensive than at the start of the heating season.
Manufacturers say they are at a disadvantage to exporters, which have long-term supply deals with overseas utilities and global energy firms that enable them to in turn lock up capacity on U.S. pipelines for many years.
U.S. energy executives and LNG advocates say there is no evidence that exports have caused higher prices or local availability issues.
President Trump has advocated greater energy exports as a way of gaining geopolitical sway as well as reducing the trade deficit. His administration has approved new LNG facilities, which are expected to help double export capacity by 2030. The president has also pressured trade partners, including the European Union, to commit to buy much more U.S. LNG.
“LNG exports have motivated U.S. production growth and productivity improvements that exert downward price pressures and benefit American consumers,” Dean Foreman, chief economist of the Texas Oil & Gas Association, wrote last year in a study. *
LNG industry officials note that the flow of gas into export terminals dropped during the worst of the recent winter storm, when about 15% of U.S. production became blocked in frozen wells from West Texas to Appalachia.
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*There is another view on the impact of LNG exports on prices.
According to Wood Mackenzie, European demand for industrial natural gas has declined by 21% since 2021 while industrial power demand has decreased by 4%, driven by soaring gas prices after Russia’s invasion of Ukraine. However, WoodMac has projected that the ongoing massive wave of new global LNG supply, primarily from the U.S. and Qatar, is expected to nearly halve European traded gas prices by 2030 compared to 2025 levels, saving European industry roughly $46 billion annually by 2032. Conversely, surging LNG exports and soaring demand from AI data centers are projected to push domestic U.S. gas prices to an average of $4.90/MMBtu between 2030 and 2035, a nearly 50% increase from 2025 levels. This constitutes a narrowing competitive gap, with the large cost advantage that U.S. manufacturers have enjoyed for over a decade poised to shrink despite U.S. energy remaining cheaper than European energy in absolute terms.