LNG Export Jobs Create True Wealth

By John Plesnicar
Published: May 6th, 2012

Recently I attended the World LNG Americas series in San Antonio Texas.  The opening keynote address was given by Mr. Davis Thames President of Cheniere Marketing.  A portion of his presentation discussed the jobs that would be created by the Cheniere LNG export project.  Mr. Thames pointed out that in addition to the construction and operation jobs at the Sabine Pass liquefaction site there would also be up to 50,000 jobs involved with supplying the feed gas needed for the plant.  This feed gas will not just be coming from Texas and Louisiana but from 33 gas producing states.  

There is an important discussion regarding U.S. jobs in the LNG export value chain which the industry should be emphasizing.  Not all jobs are equal in the net benefit of wealth creation for a nation.  There is a hierarchy of jobs which benefit a nation more than others in terms of creating wealth.  The jobs created by Cheniere and the entire LNG export chain should be touted as being at the top of this job wealth creation pyramid.  The U.S. natural gas and LNG industry should be emphasizing that not only can LNG exports be a model for job creation, but also a model for badly needed wealth creation for the United States.

Why are all jobs not equal? 

Winston Churchill once said “that for a nation to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”  Currently too many jobs and industries in the United States are “in the bucket.”  When we look at the jobs created in the United States in the last 25 years the majority have been in government, health care, education and the service sector.  Not only do most of these jobs require tax payer dollars to fund but also massive amounts of tax payer money for pensions and future obligations.  The United States has debt issues, some of the highest unemployment since the Great Depression and a trade deficit that grows every year.  The nation’s ability to continue borrowing or raising taxes will come to an end.  If the United States would like to continue to enjoy a high standard of living then it must find a way to start creating new wealth.  

LNG exports are part of the solution. 

The thousands of jobs that could be created by increasing the United States internal use of natural gas and exporting of LNG require 1) No tax payer funding.  Taxpayers and business will not be asked to help pay to create these jobs.  Compare this to a construction job building a road, school or courthouse, all of which require taxpayer money to fund.  All construction jobs can’t be thought of as equal with regard to wealth creation.  2) Money and investment that the US does not currently have an opportunity to obtain comes from overseas buyers and pays for upstream and LNG terminal jobs.   3.)  These jobs are self-funding and do not require taxpayer money and will continue to produce wealth year after year. LNG export value chain jobs create true wealth. 

Summary 

Some jobs create wealth for a nation and some jobs do not.  As a nation we need to be intellectually honest regarding these facts.   The Sabine Pass LNG export facility and others if approved will generate true wealth for the United States.  The Department of Energy has commissioned a study which will include employment implications of U.S. LNG exports. The study will be released later this year.  One concern is that the study will just have a simple head count of total jobs created in the LNG export industry and not take in to account the wealth and investment these jobs can bring to the United States. The U.S. can't continue on its current path of borrowing money or raising taxes to try and create employment.  The only way to fund schools, roads and hospitals are with jobs which produce true wealth creation.   The entire LNG export value chain can create those types of jobs.   All jobs are not equal and employment in the LNG export value chain is at the top of the wealth creation pyramid.  


John Plesnicar is the Managing Director of LNG Global

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