Today the New York Times is running a long feature Cheniere Energy, an admirable Houston-based LNG company that has just cleared some major regulatory hurdles and is rushing to build several regasification terminals on the Gulf – thereby holding a major key to the future of energy security for the United States. One of the two terminals, at Sabine Pass in Texas, will be able to handle 400 tankers a year, making it the largest import hub of natural gas in the country. The bottom line: Cheniere has quietly become the premiere player in LNG in the United States. What the article does not mention is that there are indications that a Russian state energy firm may be considering acquiring a major participation in the company (perhaps majority), and gain a critical foothold into U.S. energy infrastructure. Check out some of the following quotes: News from Russia via the Houston Chronicle:

Gazprom Deputy Chairman Alexander Medvedev said Tuesday in Houston that, in exchange the Russian company would allow Western energy companies to have a role in developing the Shtokman Field in the Barents Sea. “Our principle is simple. We want to be involved in all parts of the value chain,” Medvedev said in the interview published in Wednesday’s editions of the Houston Chronicle. “For access to our strategic reserve base, we want equal access to the downstream and midstream assets.”

Upstream also reported on “close talks” between Russia and Cheniere on March 24, 2006 (not available online):

Liquefied natural gas terminal developer Cheniere Energy is looking to Russia for potential deal-making opportunities to reserve capacity at its planned LNG import terminals along the Gulf of Mexico coast, writes Anthony Guegel. … The talks could lead to a trip to Moscow by Cheniere’s co-founder and chief executive Charif Souki. Such a trip is believed to be under consideration by Cheniere. … John Hattenberger, LNG dirtector for Gazprom Marketing & Trading, has made no secret of his company’s ambition to be a world leader in the delivery of LNG. Part of that global strategy includes staking out a position in North America, and particularly in the US. Last week, Hattenberger said at an LNG industry forum in San Antonio, Texas, that talks for reserving regasification capacity in the US have hit “fever pitch”.

The Kremlin has long desired to diversify their customer base for Russian gas, and get more and more natural gas out of the pipelines and onto LNG tankers to sell on the spot market to the top bidder – thereby giving them more flexibility on long term pipeline contracts. This increased ability to take advantage of price upswings on the spot market will not only cripple the EU’s bargaining position, but will also dramatically strengthen the Kremlin’s political leverage with the United States, and will provide them with a critical position to encircle North America on many energy import routes. Isn’t it time that lawmakers and consumers heard this knocking at the door? One need not look further than the Ukraine fiasco to see what the Russians would be willing to do the U.S. energy supply should any political or business decision go against their interests. Yes, it is true that importing Russian gas to the gulf will inevitably happen in the future, but the time to play hardball is now, by demanding critical reforms to separate the energy industry from politics, respect rule of law, and improve human rights before the Kremlin is allowed to take over strategic U.S. companies.