Liquefied Natural Gas (LNG) Exports from Louisiana and Florida Approved by DOE, While Alaska LNG Project Makes Progress

Shortly after finalizing its revised procedures for reviewing pending liquefied natural gas (“LNG”) export applications, the Department of Energy (“DOE”) issued final authorizations for two facilities to export LNG to countries that do not have a Free Trade Agreement with the United States (“non-FTA countries”).  You can read our previous post for details regarding changes to the DOE’s review process.  Having completed the required environmental review called for by the National Environmental Policy Act, Cameron LNG, LLC and Carib Energy LLC were reviewed by the DOE and approved to export LNG from their terminals in Louisiana and Florida, respectively.  Senator Mary Landrieu, Chair of the Senate Committee on Energy & Natural Resources, had pushed for the approval of the Cameron LNG project, noting that “Cameron LNG will create thousands of high-paying jobs in Southwest Louisiana, open new markets for American producers, and position the United States as an energy superpower.”  Senator Lisa Murkowski, Ranking Member of the Committee, applauded the DOE’s approvals as “further evidence that the administration is taking seriously requests for swifter action on applications to ship LNG to non-free trade countries.”

The DOE’s revised procedures apply only to exports from the lower-48 states and explicitly exclude Alaska, given the potential utility of issuing conditional authorizations for unique Alaskan projects.  The new procedures note:

The revised procedures will apply only to exports from the lower-48 states. In the Proposed Procedures Notice, DOE stated that no long-term applications to export LNG from Alaska were currently pending and, therefore, DOE could not say whether there may be unique features of Alaskan projects that would warrant exercise of the DOE’s discretionary authority to issue conditional decisions. After publishing the Proposed Procedures Notice, DOE received one application to export LNG from Alaska. See Alaska LNG Project LLC, Application for Long-Term Authorization to Export Liquefied Natural Gas, Docket No. 14–96–LNG (July 18, 2014). DOE will consider whether to issue a conditional decision on that application, or any future application to export from Alaska, in the context of those proceedings.

The Alaska LNG Project’s DOE application seeks authorization to export to FTA and non-FTA countries an aggregate of 20 million metric tons per year of LNG for a 30-year term, and it notes that the “unique nature of the proposed Alaska LNG project (“Project”), including the size, scope, costs, required upstream development, and project development timeline that are more significant than any LNG project in the lower 48 states of the United States (“lower 48”).”

The companies behind the Alaska LNG Project (Alaska Gasline Development Corporation, BP Alaska LNG LLC, ConocoPhillips Alaska LNG Company, ExxonMobil Alaska LNG LLC, and TransCanada Alaska Midstream LP) have since filed a Request to Commence Pre-Filing Process (Docket No. PF14-21)  with the Federal Energy Regulatory Commission (“FERC”).  The Request sets forth an anticipated schedule for the LNG project, including the submission of an application to FERC in September 2016 and requested authorization of the application by the agency no later than July 2018.  The Request suggests that the project will begin construction in 2018-2019 and be in service between 2024-2025.

We may see another conditional authorization from the DOE for the Alaska LNG Project.  In the meantime, many hope to see additional final authorizations from the agency for those LNG projects that have been pending for quite some time.