LNG

The US Department of Energy has removed the requirement for long-term LNG export authorization holders to seek separate short-term permits to export volumes, boosting the flexibility of US companies in the spot cargo market.

By consolidating this authority in a single authorization without any increase in total approved export volumes, the DoE said it was a move to streamline its regulatory process.

“This policy is a sensible and concrete way DoE can remove unnecessary regulatory burdens for LNG exporters,” said Secretary of Energy Dan Brouillette.

“Those exports bring benefits to our economy, while also helping to reduce global emissions,” added Brouillette in reference to US shipments to Asia helping to enable the switch from coal to gas.

The DoE believes that this deregulatory measure would lead to administrative efficiency.

It would also remove a duplicative requirement for exports of LNG to have DoE authorization for the short-term market, where the authorization holder already has long-term export authority.

Concurrent with this policy statement, DOE added that it was amending several long-term LNG export orders to add short-term export authority to the long-term orders.

“We are increasingly seeing more sales of LNG on the spot market, and this action by DoE is allowing more flexibility for US LNG exporters,” explained Deputy Secretary of Energy Mark W. Menezes.

“With this policy, US LNG exporters can let the market - not our regulatory process - determine which LNG cargos will be exported under long-term or short-term agreements on the spot market,” stated Menezes.

Acting Under Secretary of Energy and Assistant Secretary for Fossil Energy Steven Winberg said LNG export policies should support the market aims of US companies.

“We want to have a sensible regulatory system that takes current market realities into account, and this policy statement does just that,” added Winberg.

At the start of January 2021, the DoE also issued its fourth set of LNG export authorizations through to 2050.

This action followed several LNG export term extensions issued since October 2020 pursuant to its global export policies.

The latest term extensions were given to the Southern LNG export facility operating in Georgia, the Elba Island plant, as well as Sempra Energy’s Cameron facility in Louisiana.

The new permits have also been given to the Annova LNG project proposed in Texas and Eagle LNG’s two small-scale facilities in Florida, including the Maxville facility currently in operation.

These issuances extended each project’s long-term LNG export authorization to non-free trade agreement (non-FTA) countries through December 31, 2050. 

Term extensions now apply to permits now held by 18 US LNG export projects, as well as the Costa Azul project in Mexico. 

The US Department of Energy has extended the terms of five long-term liquefied natural gas export authorizations through 2050 for plants in Louisiana, Texas, Georgia and Florida.

The US Department of Energy extended the terms of seven long-term liquefied natural gas export authorizations through 2050 to help preserve what it said was a vital energy source for its friends and allies.

The actions follow 10 LNG export term extensions previously issued in October pursuant to an export term policy statement finalized in July 2020 by the DoE.

“The success story of US LNG continues to be written, and these extended authorizations will ensure that the benefits from these exports continue for decades to come,” said US Secretary of Energy Dan Brouillette.

“The United States just set a new all-time high record for LNG exports in November 2020, and the monthly rate of LNG exports has now quintupled since the beginning of the Trump Administration,” added Brouillette

The term extensions issued include for the Golden Pass project owned by Qatar Petroleum and ExxonMobil whereby the terminal is currently being transformed into an export plant.

Other projects under development and on the extension list to 2050 are Texas LNG, proposed for Brownsville, Texas, as well as Magnolia LNG in Louisiana.

The Magnolia plant is proposed for a 115-acre site near the Calcasieu Ship Channel. It is designed to produce 8.8 million tonnes per annum of LNG from four Trains.

Both Texas LNG and Magnolia are controlled by Glenfarne, a New York-based fund specialising in energy infrastructure investment.

Tellurian Inc.’s Driftwood venture at Lake Charles in Louisiana and the Delfin LNG project, proposed for offshore Louisiana, are on the list as well.

The Delfin FLNG project is based on the deployment of floating liquefaction facilities with other moored production and storage vessels.

The Delfin developers have already been awarded a deepwater port licence by the US Maritime Administration and the venture has been approved by the US Coast Guard.

Delfin then asked the Federal Energy Regulatory Commission for a three-year and six-month extension until 28th March, 2023 to build facilities to connect up to the FLNG units 30 miles off the coast.

Sempra Energy, the owner of the Cameron LNG plant in Louisiana, also sees and extension linked to its Costa Azul project on the Pacific Coast of Mexico.

Costa Azul, which recently reached a final investment decision for its mid-scale project, has DoE authorization to import and liquefy US-sourced natural gas for export from Mexico.

“Critical to our Nation’s energy independence are the prospects presented by these long-term LNG export extensions,” said Deputy Secretary of Energy Mark W. Menezes.

“LNG is and will continue to be a vital energy resource for our friends and allies around the world,” added Menezes.

These issuances extend each project’s long-term LNG export authorization to non-free trade agreement (non-FTA) countries through December 31, 2050.

Acting Under Secretary of Energy and Assistant Secretary of Fossil Energy Steven Winberg said the move was necessary.

“It is important for DOE to do everything to assure a long-term future for US LNG exports, which will continue to meet global energy security and emissions reduction goals,” added Winberg.

Including the term extension applications just granted, long-term LNG export authorizations with export terms through 2050 are now held by 13 US LNG export projects, as well as the Costa Azul project in Mexico.