US fossil fuel exports spur growth, climate worries

By MICHAEL BIESECKER and KIM TONG-HYUNGEnergyAssociated Press

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In this Friday, Dec. 7, 2018 photo, construction continues on large-sized liquefied natural gas (LNG) carriers at the Daewoo Shipbuilding and Marine Engineering facility in Geoje Island, South Korea. More than half of the 35 vessels scheduled for delivery in 2018 were LNG carriers. A similar number of vessels are lined up for completion in 2019. (AP Photo/Ahn Young-joon)

In South Korea's largest shipyard, thousands of workers in yellow hard hats move ceaselessly between towering cranes lifting hulks of steel. They look like a hive of bees scurrying over a massive circuit board as they weld together the latest additions to the rapidly growing fleet of tankers carrying super-chilled liquefied natural gas across the world's oceans.

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The boom in fossil-fuel production in the United States has been matched by a rush on the other side of the Pacific to build the infrastructure needed to respond to the seemingly unquenchable thirst for energy among Asia's top economies. When Congress lifted restrictions on shipping crude oil overseas in 2015, soon after the Obama administration opened the doors for international sales of natural gas, even the most boosterish of Texas oil men wouldn't have predicted the U.S. could become one of the world's biggest fossil-fuel exporters so quickly.

Backers of U.S. exports of liquefied natural gas, or LNG, argue that the boom will produce environmental benefits because it will help China and other industrial nations wean themselves from coal and other dirtier fossil fuels.

Environmentalists counter that the massive new supplies unleashed by American advances in extracting natural gas from shale doesn't just make coal-fired power plants less competitive. LNG also competes with such zero-carbon sources of electricity as nuclear, solar and wind — potentially delaying the full adoption of greener sources. That's time climate scientists and researchers say the world doesn't have if humans hope to mitigate the worst-case consequences of our carbon emissions, including catastrophic sea-level rise, stronger storms and more wildfires.

"Typically, infrastructure has multi-decadal lifespans," said Katharine Hayhoe, a climate scientist and director of the Climate Science Center at Texas Tech University. "So, if we build a natural-gas plant today, that will impact carbon emissions over decades to come. So those are the critical and crucial decisions that are being made today. Do we increase access to and use of fossil fuels, or do we make decisions that limit and eventually reduce access to fossil fuels?"

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This story is part of a collaboration between The Associated Press and the Center for Public Integrity, The Texas Tribune and Newsy.

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While it is difficult to estimate how much America's rise as major exporter of fossil fuels is contributing to a hotter climate, some of the economic benefits are plain to see in South Korea's shipyards.

At the sprawling Daewoo Shipbuilding and Marine Engineering facility on the island of Geoje, more than half of the 35 vessels scheduled for delivery in 2018 were LNG carriers. A similar number of vessels are lined up for completion next year.

South Korea's big three shipbuilders — Daewoo, Hyundai Heavy Industries and Samsung Heavy Industries — won orders for 53 new LNG carriers in 2018 at about $200 million each, soaking up the lion's share of the 62 vessels ordered globally, according to numbers compiled by the London-based shipping group Clarkson Research. South Korea is expected to finish 2018 at the top spot in overall orders for new commercial ships, surpassing China for the first time in seven years.

During a recent visit by The Associated Press, three of the LNG carriers were being assembled inside a massive dry dock. Another 13, including The British Contributor, had been floated out to nearby berths where workers were putting on finishing touches.

U.S. LNG exports quadrupled in 2017, with this year on track to see similarly exponential growth. Nearly a fifth of all that gas goes to South Korea.

The British Contributor is the third of six LNG carriers being built by Daewoo for British energy giant BP, which will mainly use them to transport U.S. gas to Asia under a 20-year contract with the Freeport LNG facility south of Houston. Daewoo delivered four similar ships this year to the government-owned Korea Gas Corporation, which has a 20-year deal to buy gas exported from Cheniere Energy's Sabine Pass LNG terminal in Louisiana.

Burning natural gas produces about half the carbon dioxide as burning coal does. LNG's increased adoption for generating electricity has been pitched by the U.S. and others as a way for nations to make progress toward meeting their emissions reductions goals under the 2015 Paris climate accord. Burning gas also creates less particulate pollution.

In China, the Communist government has declared a "Blue Sky Defense War" to reduce the choking smog in Beijing and two dozen surrounding cities with a program to convert hundreds of thousands of homes and industrial facilities from burning coal to gas. In February, Texas-based Cheniere signed a 25-year deal with the state-controlled China National Petroleum Corporation to export LNG from its export terminal in Corpus Christi.

But the increased gas exports from the U.S. and other sources hasn't really put much of dent in Chinese coal consumption, which has remained largely flat in 2018. Overall carbon emissions for China, the globe's biggest emitter, saw a nearly five percent increase in 2018.

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Associated Press investigative reporter Michael Biesecker reported from Washington. Center for Public Integrity reporter Jamie Smith Hopkins contributed.

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Follow Biesecker at http://twitter.com/mbieseck and Seoul-based AP reporter Tong-hyung Kim http://twitter.com/KimTongHyung