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DOE Proposes Expedited Small-Scale LNG Exports to Non-FTA Countries

The Department of Energy (DOE) said it wants to expedite the approval process for small-scale exports of liquefied natural gas (LNG), primarily to countries in the Caribbean, Central America and South America.

According to a proposed rule published in last Friday's issue of the Federal Register, DOE has proposed revising its process for authorizing LNG exports to countries that do not have a free trade agreement (FTA) with the United States. Specifically, the rule calls for DOE to issue an export authorization for any complete application that proposes exports of up to 140 MMcf/d, and which do not require an environmental impact statement under the National Environmental Policy Act.

"For applications meeting these criteria, the exports are considered 'small-scale natural gas exports' and are deemed in the public interest under the Natural Gas Act (NGA)," DOE said Friday. "Exports of natural gas to FTA countries are already deemed in the public interest under the NGA."

DOE Secretary Rick Perry added that the Trump administration "is focused on finding ways to unleash American energy and providing a reliable and environmentally friendly fuel to our trading partners who face unique energy infrastructure challenges. The DOE and this administration are wholeheartedly committed to strengthening the energy security of the United States and our allies."

DOE will accept public comments on the proposed rule until Oct. 16.

Last March, the Center for Liquefied Natural Gas appealed to Perry and lawmakers in Congress to expedite the LNG approval process, to both FTA and non-FTA countries. The next month, the DOE approved an authorization for Golden Pass Products LLC to export up to 2.21 Bcf/d of LNG to non-FTA countries. In June, Delfin LNG LLC was given authorization to export 1.8 Bcf/d to non-FTA countries from a proposed offshore Louisiana floating LNG terminal in the Gulf of Mexico.

The Federal Energy Regulatory Commission last month approved a Bermuda-based partnership's plans to slightly expand an LNG import terminal in Puerto Rico.

But manufacturers worry that an increase in LNG exports will drive up domestic natural gas prices. Last April, the Industrial Energy Consumers of America (IECA) sent a letter to Perry urging him to enact a moratorium on exports. Two months later, IECA renewed its call for a moratorium on LNG exports to non-FTA countries in a series of recommendations to Perry and Commerce Secretary Wilbur Ross.

At the time of Golden Pass's approval, DOE had authorized 19.2 Bcf/d of LNG exports to non-FTA countries. Last month, DOE reported that as of Aug. 25, it had received applications to export a combined total of 51.59 Bcf/d from the Lower 48 to non-FTA countries. But it is doubtful that much LNG would ever be exported, since many of the proposed export facilities won't be built.

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