Center for LNG urges DOE to scrap proposed export review changes

The US Department of Energy’s proposal to only issue national interest determinations to LNG export projects that have completed a National Environmental Policy Act review should be withdrawn, the Center for Liquefied Natural Gas said.

The approach fails to address timeliness problems and financial uncertainty they create, CLNG Pres. Bill Cooper said in formal comments submitted to DOE as the formal comment period on the proposal closed on July 21.

Instead, CLNG encouraged DOE to void the current Order of Precedence, withdraw the proposed procedural changes (OGJ Online, May 29, 2014), and follow the Natural Gas Act and its existing regulations by issuing a decision promptly after the close of each submitted applications’ required public comment period.

“An applicant should have the reasonable expectation that upon completion of the application, its filing with DOE, payment of the filing fee, and the expiration of the comment period as established in the Federal Register notice without evidence being introduced to overcome the statutory presumption, DOE would require nothing more than the official record to render a decision,” Cooper said.

Two other organizations criticized DOE’s proposed changes for different reasons. The Industrial Energy Consumers of America (IECA) urged DOE to maintain the existing procedure that puts the public interest test first and the US Federal Energy Regulatory Commission’s approval second when determining whether to approve an LNG export application for shipment to countries which do not have a free trade agreement with the US.

“Determining whether an LNG export application will not be consistent with the public interest should, as the Natural Gas Act makes clear, comes first, not last,” IECA Pres. Paul N. Cicio said. “The core issue is, and always has been, to consider LNG exports on an application-by-application basis, and on a cumulative basis—answering the question as to whether the applicant’s proposed LNG export volume for shipment to non-free-trade countries will not be consistent with the public interest.”

DOE should make its public interest determination process transparent, IECA also said in its comments. Decisions on how much LNG to export are critically important to the entire economy and for future generations, yet DOE has not fully disclosed how its decisions are made, it said.

The Sierra Club, meanwhile, said in its comments that DOE’s LNG export rules remain inadequate because they don’t consider effects of increased US natural gas production from more exports, including increased greenhouse gas emissions which would not be consistent with the Obama administration’s stated goal of reducing climate pollution emissions 17% by 2020.

The environmental organization applauded DOE’s proposal to end its practice of conditionally approving LNG export applications before an environmental review has been completed, however. “It's never made sense to evaluate LNG exports without knowing the impact they would have on the environment and on our climate, so this announcement is a step in the right direction,” Sierra Club Senior Atty. Nathan Matthews said in a July 21 statement.

Contact Nick Snow at nicks@pennwell.com.

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