Political and regulatory indicators point to the U.S. Department of Energy (DOE) giving the green light to pending applications to export liquefied natural gas (LNG) to non-free trade agreement (FTA) nations by no later than early next year, according to Sempra Energy CEO Debra Reed.
San Diego-based Sempra is one of a number of companies with applications to export LNG to non-FTA nations pending at DOE, and it has accumulated Japanese and French partners to both help build the $6 billion facilities and contract for long-term supplies that would be exported from its existing LNG import facility at Cameron, LA (see Daily GPI, May 4).
Sempra has heard from “many parties in Washington, DC,” that the Obama administration supports LNG exports, and that a federal report examining the impact of proposed exports on the U.S. domestic gas market will be released by late summer, Reed said during a conference call with analysts.
“We already have two reports that pretty much say the same thing: namely that there is no negative impact from U.S. exports,” Reed said. “Given that, it is pretty hard to believe that a third report would be substantially different from that.”
After the latest report is released, Reed said the common assumption is that DOE will issue its decisions on the export applications, which she thinks will provide the approvals that Sempra and others need to move forward. Her confidence is buoyed by the language DOE uses in its export permit applications.
“The DOE language presumes approval, and it puts the burden of proof to show that there would be an adverse effect [from LNG exports],” Reed said. “The language is presumptive, assuming that exports are good and that we are going to have an open market for gas, and they (export opponents) actually have to prove why it shouldn’t be that.
“So I think with what we are hearing leads us to believe that this is going to be moving forward at the end of this year or the first part of next year.”
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