Louisiana plans to collect no industrial property tax from the $15.2 billion Driftwood liquefied natural gas (LNG) export terminal planned for its southwest corner, state officials announced in December.
Critics say this tax break is worth $1.4 to $2.4 billion, making it one of the largest local corporate tax exemptions in American history — even larger than those offered to Amazon for its much sought-after second headquarters.
Proposed by the natural gas firm Tellurian, the Driftwood terminal, which would liquefy and export 4 billion cubic feet of natural gas a day, is one of over a dozen gas export terminals proposed around the U.S. and fueled by a glut of shale gas released by fracking. The final investment decision for Driftwood is expected in early 2019, as are decisions on two other proposed Gulf Coast export terminals.
The move comes as a group of investors and insurers have called on the U.S. and all other G20 nations to end fossil fuel subsidies entirely by 2020, citing the risk that climate change poses to the global economy.
From 2012 to 2016, fossil fuel subsidies were slashed in half, falling from a peak of nearly $500 billion, according to the International Energy Agency’s World Energy Outlook 2018. However, in 2017, global subsidies began to rise again, edging up to $300 billion. (The IEA report looked only at subsidies for energy consumption and left out the costs borne by the public of health impacts and environmental harms.)
By 2025, analysts say, the U.S. could become the world’s largest exporter of the fossil fuel LNG.
Driftwood alone could nearly double American LNG exports, as the industry currently has the capacity to export 3.6 billion cubic feet a day, according to the Energy Information Administration. Tellurian plans to pipe shale gas from Texas’ Permian Basin and Louisiana’s Haynesville shale through…