trending Market Intelligence /marketintelligence/en/news-insights/trending/ol549BVGRxfWFaZ_bd7MJQ2 content esgSubNav
In This List

FERC delays vote that could have approved 1st LNG export project in 2 years


See the Big Picture: Energy Transition in 2024


IR in Focus | Episode 10: Capital Markets Outlook


Infographic: The Big Picture 2024 – Energy Transition Outlook


The Big Picture: 2024 Energy Transition Industry Outlook

FERC delays vote that could have approved 1st LNG export project in 2 years

The Federal Energy Regulatory Commission delayed a vote on Venture Global LNG's proposed Calcasieu Pass natural gas liquefaction terminal in Louisiana, which could have been the first authorization of a new LNG export facility by the agency in two years.

Chairman Neil Chatterjee's decision to strike the item from the FERC agenda ahead of a Dec. 20 meeting, as well as a small Dominion Energy Transmission Inc. pipeline project, implied that the commission lacked the votes to advance the projects, the research firm ClearView Energy Partners said in a note to clients. The development left it unclear whether further votes on LNG projects could face delay.

SNL Image

FERC Chairman Neil Chatterjee

Source: Federal Energy Regulatory Commission

The newest commissioner, Bernard McNamee, did not vote for or against any items during the meeting, saying he was still preparing in his role after joining Dec. 11. And Commissioner Kevin McIntyre, who is ill, was absent and did not vote. Both are Republican appointees.

That left Chatterjee and two Democrat-appointed commissioners, Cheryl LaFleur and Richard Glick, as the three members voting at the meeting. LaFleur said she was prepared to vote on the Calcasieu Pass project and was disappointed that the commission did not.

"Without getting into internal deliberations, I think I made clear what I believed was required of us when considering whether to authorize this LNG project," LaFleur said, going on to refer to previous comments related to pipeline projects. Those comments have shown differences among the commissioners on how the agency should evaluate projects' effects on the climate.

Chatterjee acknowledged after the meeting that it was his prerogative as commissioner to strike an item from the agenda but declined to elaborate on the reason, citing internal deliberations.

"I've been very clear [in] the time that I've been at the commission that LNG exports are a priority of mine," Chatterjee said. "I'm obviously disappointed that we weren't able to act on the LNG [certificate] today. I appreciate my colleague's concerns but also when she was chairman she had a reputation of being a strong supporter of LNG exports. The policy was fine then."

In separate comments, Chatterjee cited several LNG terminal applications in various stages of review by staff as some of the significant work that lies ahead for the commission in 2019. A dozen LNG projects received updated schedules for environmental reviews from FERC in late August as part of the agency's effort to work through a backlog of applications.

Calcasieu Pass was recently identified by Wood Mackenzie as one of three second-generation U.S. LNG export projects likely to reach a final investment decision in 2019, pending FERC authorization. Venture Global has lined up a heavy industrial construction firm to build the project, which would export up to 10 million tonnes per annum of LNG. The company has also secured a series of long-term LNG supply deals with off-takers that support the project.

SNL Image

FERC Commissioner Cheryl LaFleur

Source: Federal Energy Regulatory Commission

ClearView told clients the firm had expected the commission to approve both Calcasieu Pass and Dominion's Sweden Valley expansion project — designed to move 120,000 Dth/d of gas in Pennsylvania and Ohio — because they were included on the agenda for the open meeting. After Calcasieu Pass cleared a final environmental impact statement in October, a FERC decision on the project was expected by late January 2019.

"Whether the Commission numbers three, four, or five (depending on Commissioner Bernard McNamee's preparedness to vote given his recent ascension to FERC and Commissioner McIntyre's health), the position of Commissioner Cheryl LaFleur appears to remain central to decisions," ClearView wrote. "For example, she has not always joined her fellow Democrat-appointed Commissioner (Richard Glick) in dissenting on natural gas project votes, finding it appropriate in some cases to weigh potential greenhouse gas impacts on her own to ascertain whether she can support a project approval." (FERC dockets CP15-550, CP15-551 and CP18-45)