A dissenting voice in natural gas boom

Boosting exports would be a gamble, Dow exec warns

Clifford Krauss and Nelson D. Schwartz / New York Times News Service /

Published Aug 16, 2013 at 05:00AM

MIDLAND, Mich. — As Dow Chemical’s chief executive, Andrew Liveris has made himself into something of an outcast among his fellow business leaders.

The reason? He is spearheading a public campaign against increased exports of natural gas, which he sees as a threat to a manufacturing renaissance in the United States, not to mention his own company’s bottom line. But many others say such exports would provide far more benefits to the country than drawbacks, all part of a transformation that promises to increase the nation’s weight in the global economy.

But that windfall is at risk if the government permits natural gas exports to increase quickly, Liveris warns.

To nurture the nation’s good luck, he says, the government needs to plan an energy policy that carefully balances the interests of the oil and gas companies that want to freely export natural gas with those of industries like Dow Chemical Co., that fear that an export boom could outpace domestic gas supplies and bring higher energy prices.

Not surprisingly Liveris has become a lightning rod, particularly to those in the oil and gas drilling business.

“He is coming across as a hypocrite and a self-serving person,” said Charif Souki, chief executive of Cheniere Energy. “He wants free trade for everything he manufactures but no free trade for anybody else.”

Liveris concedes that the interests of his company coincide with his views. But he says that as the chief executive of Dow Chemical he also represents the interests of energy consumers at large.

“I’m protecting my shareholders,” he said, pointing out as a cautionary example his native Australia, which he said exports 90 percent of its gas. That has caused, he says, “the collapse of the manufacturing sector. And, by the way, the retail sector’s paying through the nose. We’re paying Japanese electricity prices in Australia, yet Australia is gas rich.”

Liveris says that he also favors free markets, but that energy — like defense and food — requires special care to protect the national interest. Exporting natural gas is fine, he said, but not at the price of importing it back in the form of goods made with cheap gas elsewhere.

“The paint ingredients need the paint can,” he said. “The paint supply chain needs trucks. The trucks go to warehouses. Warehouses go to retail. I’m not importing finished goods. I’m making them in the United States of America.”

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