DOE Proposes Expedited Approval for Small-Scale LNG Exports

The U.S. Department of Energy (DOE) has promulgated a proposed rule that will provide for expedited approval of small-scale exports of natural gas, including LNG, from U.S. export facilities.  According to the press release, the U.S. small-scale LNG export market involves exports of small volumes of natural gas from the United States primarily to countries in the Caribbean, Central America, and South America that “do not generate enough natural gas demand to support the economies of scale required to justify large volumes of LNG imports from large-scale LNG terminals via conventional LNG tankers.”  Under the proposed rule, DOE would grant upon receipt applications to export natural gas, including LNG, to countries without a Free Trade Agreement (FTA) with the United States provided: (1) the application proposes to export no more than 0.14 Bcf/day, and (2) the proposed export qualifies for a categorical exclusion under DOE’s National Environmental Policy Act regulations.   Such exports would be considered “small-scale natural gas exports” and would be deemed in the public interest under the Natural Gas Act (NGA).  Exports of natural gas to FTA countries are already deemed in the public interest under the NGA.  Comments on the proposed rule are due October 16, 2017.