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EPA: Weigh Induced Gas Production Effect in Corpus Christi LNG Permitting

FERC's draft environmental impact statement (DEIS) on Cheniere Energy's Corpus Christi Liquefaction LLC project is incomplete for several reasons, according to the Environmental Protection Agency (EPA) Region 6 office, most notably because it does not address the impacts of increased natural gas production that could be stimulated by liquefied natural gas (LNG) exports, EPA said.

The Federal Energy Regulatory Commission issued the DEIS and solicited comments on the document in June (see Daily GPIJune 13). The export terminal slated for Corpus Christi, TX, is Cheniere's second and its first greenfield export project. Construction is under way at Cheniere's Sabine Pass terminal in Louisiana (see Daily GPI, June 6a), a brownfield project at the site of existing regasification facilities and the only export project so far to have gained FERC and U.S. Department of Energy (DOE) clearance.

On multiple occasions, EPA, as well as environmental groups such as the Sierra Club, have asked FERC as well as DOE to weigh the environmental impacts of natural gas production that could be indued by LNG exports when the agencies consider terminal or export permit applications. Both agencies have declined to do so (see Daily GPIJuly 31July 23April 2).

"Both FERC and...DOE have recognized that an increase in natural gas exports will result in increased production," EPA said in its filing, citing a report prepared by the Energy Information Administration for DOE's Office of Fossil Energy (OFE). The Corpus Christi DEIS says it is not feasible to evaluate where induced gas development activity might occur due to the nature of the country's gas supply and delivery infrastructure, EPA noted. However, it also cited a draft addendum that was released by DOE's OFE and prepared by the National Energy Technology Laboratory (NETL) in 2012.

While conceding that the NETL study says impacts will vary considerably by location due to multiple factors, EPA said the document "...provides the kind of conceptual level analysis of the types of impacts that are likely to occur from increased [gas] production. We recommend that this study be considered as part of the decision-making for this project and incorporated by reference in the FEIS [final environmental impact statement]."

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