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Dow Chemical CEO Andrew Liveris on how exporting natural gas would potentially impact the U.S. economy.
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He's thank you very much.
Well it has been debated all year long should -- -- -- start exporting natural gas manufacturers would take a hit from higher Nat gas prices.
But -- the benefits the overall economy be worth it.
Earlier today my colleague was claimant top to a -- at the forefront and this debate Dow Chemical chairman and CEO and deliverance.
News just the Department of Energy released its long awaited study on that gas exports and in essence saying.
Let's go -- and the report makes a bold prediction it will boost the US economy by 47 billion dollars in just seven years and create jobs which of course we desperately need.
Andrew what do you think of the report.
-- what report does not make an energy policy a -- an energy plan it's fundamentally -- and there are ninety billion dollars of projects on the books in the country right now.
Not a billion dollars three million jobs and actually twenty times -- value add that would be under threat.
If they went ahead and took the recommendations in this report -- -- look at it ignores the manufacturing sector and by its own admission it says what the agricultural sector.
And consumers if everyone takes a report and puts them in motion.
We will see a catastrophic destruction.
Of jobs in this country.
It's not just from the Department of Energy but a lot of energy companies of course some politicians particularly on the Republican side feel that.
Exporting what they call the plentiful US resource to countries who will pay a lot -- -- Will quell all the critics who say we're fumbling an opportunity to create jobs what are you buy that premise.
If you export some of it went for exports we -- for free trade.
But we're also for holistic approach that says let's export some let's not destroy the domestic pricing structure which in this country's very efficient.
On a domestic sector basis -- Nine out of ten countries in the world that a gas rich.
Look at domestic gas has its first priority.
The one country that doesn't is my home country of Australia that he's instructed to the US example.
A -- exports 90% of its gas in the form of LNG.
Point to point contracts.
And has destroyed the manufacturing sector adding fact for an energy rich country pays the same electricity prices has those -- just.
And -- in manufacturing is a huge amount of natural gas to create your Dow Chemical products.
What would be the effect if this actually happen if we started exporting if as you say prices started to go up would you have to resort to layoffs.
At the end of the day the -- cable company will be fine if this country.
-- unintended consequence lets the price of gas -- the price of oil through unintended consequence of exporting most of it.
Then the investments that are on the books not just mine.
Ninety billion dollars of other people's investments will disappear that would be a tragedy into the job creations for this country and -- I think we should let that happen.
Let me play devil's advocate.
-- can't please all the people all the time Andrew you're looking at a through the prism of Dow Chemical that higher Nat gas prices would hike.
Your costs squeezing your margins but might exporting this resource -- US economy and has put your customers in a better position that.
To buy more of what you make.
A holistic approach our national energy policy is what's required.
To balance between international competitiveness and local value -- I would say to you that's not -- conversation that's a conversation for the country.
And we should be balancing that -- seem to -- one sector.
This is the interest of the entire country it doubt doesn't get the right -- and such in this country will go to countries where we can and we do.
I think that's amid concern I mean you're building a four billion dollar plant chemical plant in Texas if the export centres of which right now there's only one.
If they got approval would you pull that Texas investment.
-- as a set a few minutes or so ago -- we can.
See exports coming out of this country up to a certain amount for that affected the domestic gas price one terminal does not -- and export sector.
-- and also -- build all over the place that export 5060% of the gas you get the world all priced back a manual scenario comes true.
The last time we talked at the -- Olympics you were concerned about slowing China a weaker Europe.
How does your business look in those areas today does anything change -- are we looking a little bit firmer little bit better.
We -- to the first to feel weak macro economies.
We're also one of the first to feel a rebound.
And China is starting to come back we'll still be a month or two while soft -- to mom because of Chinese dia.
On the other side Chinese dear -- -- we should start to see good rebound.
That's the premise Europe is still sideways down woods and here we are in the United States was one of the best economies in the world getting -- And the potential to actually take -- off the rails as you know with the fiscal -- conversation -- 'cause the because it's so very much at the forefront of the national conversation right now the fiscal cliff up more than 200 companies have moved up their dividend -- date to -- the fiscal -- deadline.
I you guys have a healthy dividend and Dow Chemical do you have plans to speed up your payments before the end of the year -- Look the -- -- you just said we have a very healthy dividend payment.
But we also have what we consider.
Long term approach to dividend long -- president pay out.
And we also have bad debt we want to retire -- balance sheet in the short answer is you know we're looking at all options but it's doubtful we will do anything.
-- okay that's -- and argue in the cheering for the fiscal click deal can't or do you think it won't be as dire if congress and the president don't strike a deal.
No I it's as Liz there's not a business.
Leader out there that is not in the camp of saying if this doesn't get done this will be have very negative effect.
On the US economy.
We are in the camp all of us looking -- To bring that point to both sides of the aisle I believe that day hearing that very loudly.
From many of us in the business community small medium -- lodge.
As a consequence of that you know the hammering out in the public domain it's one thing.
What happens in private settings we're very hopeful that the win win will be found and that all options are on the table.
-- -- CEO and deliver -- all right would.
