Dow Chemical Severs Ties With Powerful D.C. Group Over Natural-Gas Exports

By TENNILLE TRACY

WASHINGTON–Dow Chemical Co. (DOW) severed ties Friday with one of Washington’s most powerful groups representing the manufacturing industry, citing differing opinions over whether the U.S. should export its newly abundant supplies of natural gas.

Dow’s decision to split from the National Association of Manufacturers marks a new chapter in the increasingly fierce battle over natural-gas exports, demonstrating how divisive the issue has become for some of the nation’s largest companies.

In a letter to NAM President Jay Timmons on Friday, and obtained by Dow Jones, Dow Chemical accuses the group of siding with member companies that are in the natural-gas industry, rather than adopt “a position of neutrality on an issue that clearly splits its membership.”

Dow Chemical is responding to a statement NAM posted earlier this week in support of natural-gas exports. In it, NAM said sales of natural gas to foreign buyers would create opportunities for U.S. businesses.

A spokesman for NAM wasn’t available for immediate comment.

Dow Chemical, by contrast, is pushing for limits on natural-gas exports. Its chief executive, Andrew Liveris, has said unchecked exports will increase domestic prices and threaten investments in the U.S. manufacturing sector.

“The unfettered export of natural gas is widely understood to have serious implications for the cost and volatility of manufacturing feedstock prices,” Dow says in its letter to NAM. “NAM’s decision therefore places the views of oil and gas producers above the interests of its manufacturing members.”

Exxon Mobil Corp. (XOM), another NAM member company, is proposing to build a natural-gas export terminal in Texas. It has accused Dow and other companies opposed to limitless exports of being “protectionist.”

Dow Chemical spokeswoman Nancy Lamb declined to comment on the letter. But she said the company’s membership in another influential group, the American Chemistry Council, “remains to be seen.”

The fight between Dow, Exxon Mobil and, now, the groups that represent their interests in Washington comes as U.S. regulators consider more than a dozen proposals to ship U.S. natural gas to countries that lack a free-trade agreement with the U.S.