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FERC Chair Will Hire Review Experts ‘in a Heartbeat’ to Speed LNG, Pipe Certificates

FERC Chairman Kevin McIntyre told a Senate panel that he is personally committed to seeing the Commission accelerate its permitting of interstate natural gas pipelines, while also hiring more staff to address a backlog of permitting for liquefied natural gas (LNG) export infrastructure.

During his testimony Tuesday before the Senate Energy and Natural Resources Committee, McIntyre said it was time for the Federal Energy Regulatory Commission "to take a fresh look" at its policies for reviewing and authorizing interstate natural gas transportation facilities under Section 7 of the Natural Gas Act.

"I am, of course, but one of five voices on this Commission, and my colleagues are very thoughtful regulators in their own right," McIntyre said. "I anticipate the thoughtful input from each of them that I've come to expect.

"I will say for my own part, though, that I have no interest in initiating a review of our gas certificate policy area for the purpose of slowing anything down. My interest is in streamlining and making more efficient the processes that we have. I agree with the suggestion...that we need to be efficient in this area. For my own part, I endeavor to do exactly that."

FERC adopted its current policies for pipeline certification under a policy statement issued in September 1999, but the Commission issued a notice of inquiry (NOI) for a possible overhaul last April. Public comments were originally due on June 25, but the Commission extended the deadline to July 25 in late May, citing the complexity of the issues involved [PL18-1].

Sen. Lisa Murkowski (R-AK), the committee's chairman, called the NOI a "very critical and very necessary review relating to our infrastructure.

"We have been talking for about a year and a half now about the possibility for a big infrastructure package. From the energy side of things, I think that we've got some pretty good ideas, some shovel-ready issues if you will, as it relates to that pipeline infrastructure."

Murkowski asked McIntyre if he was satisfied with the number of staff working at FERC. Concern that the Commission was short-staffed and faced a backlog in the permitting process for LNG export infrastructure was also raised during a House Subcommittee on Energy hearing last April.

"I'm never satisfied," McIntyre said. "We are continuing to explore creative new ways to make our processes more efficient and to enable ourselves to address this significant amount of work that lies before us."

Sen. Cory Gardner [R-CO] said he had met with officials from Japan, South Korea and Taiwan. All three nations are interested in importing LNG produced in the United States, but the lack of an LNG export terminal on the West Coast was impacting producers in the Rockies looking for another exit option.

"I'm very concerned about staff resources at FERC, in that there could be a negative effect on the permitting timelines for these types of projects to satisfy the demand from our allies," Gardner said.

McIntyre said there were four permit applications to build LNG export terminals before FERC in 2008, but today there are 14. To address the backlog, he said the Commission was "actively looking for creative new ways to embrace and attack this increased workload." Among these were FERC's decision to outsource the non-proprietary aspects of projects and designs to third party contractors.

The projects "are larger, more complex and more expensive, and as you can imagine the review process is not a simple one," McIntyre said. "We are actively seeking to hire, so send us good people and we will hire them in a heartbeat."

Last April, FERC was among 12 federal agencies that agreed to follow expedited permitting procedures, with timetables designed to complete the reviews within two years.

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