On June 21, 2018, the Department of Energy (DOE), Office of Fossil Energy (FE) published in the Federal Register a policy statement regarding long-term authorizations to export natural gas to non-free trade agreement (FTA) countries pursuant to the Natural Gas Act (NGA).
Potential importers of US LNG and financiers of LNG export projects (collectively, interested stakeholders) have expressed concern about DOE/FE rescinding one or more non-FTA export authorizations in the future. In raising this concern, they point to the language in the existing non-FTA authorizations in which DOE/FE has observed its authority under NGA section 16 to “make, amend, and rescind such [export] orders … as it may find necessary or appropriate ….” Citing DOE/FE’s language, they have asked what potential “developments” in the U.S. LNG market could rise to the level of “such significant consequence as to put the public interest at risk”—such that DOE would unilaterally rescind one or more non-FTA export authorizations or take other action to protect the public interest under NGA section 3(a).
DOE stands behind the long-term authorizations it has issued under the NGA, approving the export of natural gas (including liquefied natural gas) to non-FTA countries. DOE is firmly committed to the durability and stability of the non-FTA export authorizations it has granted to date, and to any export authorizations issued by DOE in the future.
As a matter of law, DOE preserves its authority to take action as necessary or appropriate to carry out its duties under the NGA. However, DOE does not foresee a scenario where it would rescind one or more non-FTA authorizations. The United States government takes very seriously the investment-backed expectations of private parties subject to its regulatory jurisdiction. In particular, DOE understands the far-ranging economic investments and natural gas supply commitments associated with these authorizations over their full term—affecting both U.S. and global interests. DOE emphasizes that it remains committed to the durability and stability of the export authorizations it has granted under the NGA, as well as to supporting the approved export of U.S. natural gas around the world.
