Nat gas exports become the next step in US energy evolution
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The Department of Energy approved this week a fourth liquefied natural gas terminal to export to other nations, but even with the fuel much cheaper domestically than what it costs overseas, market observers differ on when, or if, the U.S. will become a major exporter. The Maryland-based Cove Point facility owned by Dominion Resources was conditionally approved to export up to 770 million cubic feet per day (cf/d) of natgas, to countries without a free-trade agreement with America.

To be certain, the development of the U.S. natgas export market is still in its infancy, and the idea of shipping stocks abroad remains a very touchy domestic issue. Still, Dominion's export terminal is seen by observers as the latest signpost on the ever-winding road to U.S. energy independence.

The move is more symbolic than substantive at this point—Dominion's export limit is a modest slice of U.S. production, which is expected to top 65 billion cf/d by January. Yet analysts say the facility, as well as the tentative embrace of natural gas broadly by U.S. officials, is clearly a harbinger of things to come. (Read more: Energy secretary: Emission cuts to be 'practical') "A lot of these exports are not going to take place until 2015-2016 at the earliest," said Gary Clark, commodities strategist at Roubini Global Economics. But with Dominion joining the ranks of Cheniere Energy and Sempra Energy as international natgas suppliers, "it's the signal that a lot of people have been waiting for for a number of years." Analysts at Goldman Sachs were less sanguine, saying in a research note Thursday that there is still "uncertainty surrounding the ability of proposed LNG export projects to attract financing, given that an 'overbuild' of US export terminals might leave global LNG markets over supplied" and depress prices even further. Still, Goldman added that LNG exports are "one of four major drivers" that will lead to growth in domestic demand.

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