LNG Export Bill Hits U.S. House Floor; Trade Group Predicts Passage

NGI Daily
By  Charlie Passut
June 25, 2014

A bill to expedite the approval of applications to export natural gas to World Trade Organization (WTO) countries was on the floor of the U.S. House of Representatives on Tuesday, and a group that supports liquefied natural gas (LNG) exports expects it to win passage in the chamber on Wednesday.

According to the Clerk of the House, discussions started over HR 6 -- also known as the "Domestic Prosperity and Global Freedom Act" -- on Tuesday afternoon, and will be followed by one hour for debate. Lawmakers will have five minutes each to weigh in on the measure.

In its original form, HR 6 would require the Department of Energy (DOE) to issue a decision on any application for authorization to export natural gas under the Natural Gas Act. A decision would be required within 90 days of either the end of a public comment period over the application or the date of HR 6's enactment, whichever is later.

HR 6 would also give the local circuit of the U.S. Court of Appeals original and exclusive jurisdiction over any civil action involving an export facility within its territory. Specifically, the court would review any orders issued by the DOE for an export facility's application, and any failure by DOE to issue a decision on such an application.

Lawmakers have crafted four amendments to HR 6. The first, authored by Reps. Cory Gardner (R-CO) and Gene Green (D-TX), would place a 30-day deadline on DOE to issue a final decision on applications to export LNG following the conclusion of a National Environmental Policy Act (NEPA) review of the LNG facilities. It would also require public disclosure of LNG export destinations.

During a press conference Tuesday, Center for Liquefied Natural Gas (CLNG) President Bill Cooper said the amendment written by Gardner and Green was "good" and should receive bipartisan support.

"[The amendment] does not change the statutory requirement for a public interest determination," Cooper said. "It does not change the manner in which DOE decides the applications to export LNG, or how it develops that public interest standard. It does not alter or change in any way the NEPA review process. It just requires DOE to act within a certain time after that process is concluded. We believe it will provide regulatory certainty."

Cooper said CLNG opposed amendments by Reps. Peter DeFazio (D-OR) and Rush Holt (D-NJ).

According to Cooper, the DeFazio amendment would require the disclosure of any intent to use eminent domain for the construction of any facilities or infrastructure required for LNG exports.

"LNG falls under Section 3 of the Natural Gas Act," Cooper said. "Eminent domain authority is authorized only under Section 7, which is for pipelines and related structures such as compressor stations and the like. So we find that it's not applicable and the amendment ought to be opposed on policy grounds."

Meanwhile, the Holt amendment would prohibit the DOE from issuing any authorizations prior to the date that the secretary of the DOE issues final regulations for determining whether an export application is within the public interest.

"The Holt amendment is nothing more than an imposed moratorium on processing export applications until these new regulations are promulgated," Cooper said. "We know that such a moratorium would last two years until the final regulations are done, and that could last even longer if those regulations are tested in the courts by those that oppose LNG.

"We've had enough delays in processing these applications. We need to get with the rules and regulations already promulgated to get these things decided upon."

Cooper said CLNG was looking forward to HR 6 winning passage by the House on Wednesday. He said he was hopeful that the differences between HR 6 and a competing bill in the Senate -- SB 2494, introduced last week by Sens. Mary Landrieu (D-LA) and Mark Udall (D-CO) -- would be ironed out (see Daily GPI, June 19).

Under SB 2494, DOE would be required to make a final decision on whether an LNG export application is in the national interest within 45 days of a NEPA review being finalized.

"I'm always the optimist, but I think it's likely that we can see it get signed into law," Cooper said. "When you look at the most recent draft [of SB 2294], it's pretty close to being what we're going to see voted on the House floor.

"Forty-five days, 30 days...you're kind of nibbling around the edges. That's not enough to get really upset about. If you do 45 days after the conclusion of the review required by NEPA, the House tightens that down a little bit by saying 'this is what it means the conclusion of the NEPA review.' The judicial review stuff is essentially the same. The public disclosure of export destinations in the Senate is a little more robust, to make it in-line with what DOE already does. I think they should be able to reconcile those differences easily if they can get this for a floor vote and it passes."

Cooper said he thought President Obama would sign a compromise bill into law.

"It does not change the way DOE examines these applications at all," Cooper said. "All it does is to say that at the end of the NEPA process -- when you would issue a final decision anyway -- do it. And do it within the timelines that would be agreed upon. Thirty days, 45 days...pick one.

"It provides for an expedited judicial review on the back end, which doesn't affect the DOE at all or the administration. It just allows for a more expedient and expeditious process to get it completed where we can start building these things.

"I'm hopeful. I don't think that the language rises to the level of a veto. I just don't see it [being [controversial], particularly if it passes a Democratic-controlled Senate. I would hope that the administration would see that its truly bipartisan and go ahead and sign it into law."