Posted by Brittany Stepniak - Wednesday, February 1st, 2012

Latest news on the energy forefront: natural gas exportation set to give the American economy a big boost.

After the natural gas industry experienced so much success with new drilling procedures, major companies are now focused on investing billions in export projects which will stimulate the economy by creating jobs and bringing in massive gains from foreign buyers.

One company, Cheniere (LNG), has taken the spotlight in this process...

Dominion Resources expects LNG to receive a federal permit sometime this year allowing it to export natural gas from an existing plant in Maryland. Dozens of other plants will have to be built to meet the drillers' ambitious goals...

Kogas, the world's largest LNG buyer has already committed to buying 3.5 mtpa from Cheniere for 20 consecutive years: this play will go into action no later than 2017.

This will be the first U.S. LNG export plant in nearly half-of-a-century.

State-run Kogas, South Korea’s sole gas wholesaler, will buy 3.5 million tonnes per year (mtpa) of LNG from the third of four production units planned for Sabine Pass, known as Train 3, which is expected to be online in 2017. Train 1 is scheduled for 2015, pending federal regulatory approvals.

“KOGAS is our fourth foundation customer and we have now sold 16 mtpa of the 18 mtpa being developed at the Sabine Pass LNG terminal,” said Cheniere chief executive Charif Souki in a statement.

Cheniere plans to keep the remaining 2 mtpa — 0.5 mtpa from each 4.5-mtpa train — for its own portfolio.

The U.S. Energy Information Administration indicates that in the five years between 2005 and 2010, total natural gas exports increased by 408,188 – from 728,601 in 2005 all the way to 1,136,789 in 2010.

Newly proposed export plant projects will cost billions, but the would add an additional 16 billion cubic feet of gas per day. U.S. consumption is currently about 67 Bcf/d.

If you've been keeping up to date with energy news you know that hyrdaulic fracturing and horizontal drilling, although controversial, have allowed drillers to uncover an overwhelming abundance of natural shale gas.

On account of this, natural gas prices in the U.S. have fallen to a remarkably low price of $2.50 per thousand cubic feet and left other energy industries struggling to keep up with such competitive prices.

Meanwhile, analysts speculate on what effect a surge in exports will have on domestic gas prices...

Most experts say that U.S. based Cheniere (LNG) exports will not raise gas prices. However, as mass volumes are sent out – equaling a quarter of current consumption – to foreign markets, the competition (decrease in supply, with sustained demand) some American consumers worry about the threat of rising domestic gas prices.

According to Kennth Medlock, with the James A. Baker Institute for Public Policy, American consumers shouldn't be too worried:

"The domestic supply is very robust," he told a Brookings Institution seminar recently, with sufficient surplus production capacity that exporting a "reasonable amount" of liquefied natural gas will have "no effect" on US prices.

The two most important variables in determining how the changes in exportation will affect U.S. prices are how much gas is exported and how fast those exports grow, but experts speculate that price increases in the U.S. will be unlikely in the near future, with only a slight possibility of paltry increases in the distant future.

What remains certain is that this progress in exportation plant development has opened up numerous opportunities for countless American workers and investors.