The Department of Energy (DOE) has deferred a decision on Sierra Club’s request to block a major permit for Cheniere Energy’s Sabine Pass project to liquefy and export domestic gas from Louisiana.

The order, which was issued Oct. 5 but only released Tuesday, was in response to a Sierra Club request to stay the department’s decision allowing the proposed Sabine Pass facility to export liquefied natural gas (LNG) to countries with which the United States does not have a free trade agreement (FTA).

Several companies have applied to the DOE for authorization to export LNG to non-FTA countries, but only Sabine Pass Liquefaction LLC has received the green light to do so (see Daily GPI, May 23, 2011).

Without the DOE’s action, Sierra Club’s request would have been “deemed denied,” the agency said. “The matters raised in the Sierra Club’s pleading will be addressed in a future order.”

The DOE said it is awaiting the results of the second half of a study on LNG exports before it acts on pending applications to export LNG to non-FTA countries. The report is expected to assess the impact of LNG exports on domestic gas prices, job creation, gross domestic product and the balance of trade.

“The Obama administration appears to be cautiously deferring an explicit decision [on LNG exports] until after the November elections,” wrote ClearView Energy Partner LLC energy analysts in a report in mid-September.

Sierra Club tried to block the 2.2 Bcf/d LNG liquefaction project when it was before the Federal Energy Regulatory Commission, arguing that the agency should have done a full environmental impact statement on the project rather than an environmental assessment (see Daily GPI, Feb. 1).

Despite the Sierra Club’s protests, the Commission in mid-April approved the proposal by Sabine Pass Liquefaction and affiliate Sabine Pass LNG LP to site, construct and operate facilities to liquefy domestic natural gas for export to markets worldwide (see Daily GPI, April 17). It was the Commission’s first authorization of a project that would export LNG from production resources within the United States.

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