At the company’s shareholders meeting today, the CEO of Exxon Mobil Corp. (NYSE: XOM) said that Exxon is studying the possibility of exporting natural gas from the US Gulf Coast and Canada. Natural gas production in the US has exploded as hydraulic fracturing (fracking) technology has boosted US reserves to the point where there is sufficient natural gas to meet US demand and to allow exports, according to Exxon CEO Rex Tillerson.
Chesapeake Energy Corp. (NYSE: CHK) has also discussed natural gas exports as a means to boost natural gas prices, and EOG Resources Inc. (NYSE: EOG), Apache Corp. (NYSE: APA), and Encana Corp. (NYSE: ECA) have already announced a plan to begin shipping liquefied natural gas from Kitimat, British Columbia, in 2016. Cheniere Energy Inc. (AMEX: LNG) has already obtained the required permits to allow it to export liquefied natural gas from its Sabine Pass facility in the Gulf of Mexico.
Natural gas exports would certainly result in higher domesticd prices, but Tillerson emphasized job creation, higher tax revenues, and a better US balance of trade in his remarks. Liquefied natural gas fetches $15-$16/thousand cubic feet in Asia, compared with around $2.50/thousand cubic feet in the US.
Exxon is the largest US producer of natural gas following its 2010 acquisition of XTO Energy.