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US congressman questions extent of DOE-FERC coordination on LNG exports

Highlights

The former chairman of the US House of Representatives Energy and Commerce Committee said Thursday that Congress needs to examine the roles the Department of Energy and the Federal Energy Regulatory Commission have in considering applications to export US LNG.

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Representative Joe Barton, Republican-Texas, said he has grown concerned over whether the agencies are considering LNG export applications on separate paths, as required by the Natural Gas Act, following a controversial DOE approval last month.

"It's unclear how [DOE and FERC] are coordinating, if at all," Barton said on the sidelines of a House subcommittee hearing Thursday on FERC. "But it is something that we need to shed some daylight on and clarify."


Barton said DOE may have exceeded its authority last month when it conditionally approved Freeport LNG's request to ship an additional 400,000 Mcf/d of LNG from its planned export facility in Quintana Island, Texas to countries that do not have free trade agreements with the US.

The approval, which was Freeport's second such approval and just the fifth of its kind issued by DOE, was 1 Bcf/d below what the company had requested, a reduction DOE apparently based on an application Freeport had made with FERC on proposed capacity for its liquefaction facility.

But, Barton, as well officials at Freeport, say DOE is authorized only to modify or prohibit an export quantity if it determines it is not in the public interest. DOE should not be basing its decision on the details of a potential exporter's FERC filing, Barton said.

At Thursday's hearing, Barton called DOE's recent Freeport approval "pretty troubling" because the agency was basing its approval on statutory authorities it did not have. He indicated he was considering introducing legislation that would prevent DOE from basing export approval levels on FERC filings.

"This permitting process is something that we need to get right," Barton said.

DOE has declined to comment on the Freeport decision, but when questioned by Barton, Cheryl LaFleur, FERC's acting chairman, said coordination between the two agencies on the LNG export approval process was minimal.

"We primarily work in our own lane, which is to review the environment and safety issues of the facilities and DOE reviews the actual national security issues of the export of the commodity," LaFleur said. "I think our staffs communicate so we understand what our mutual statuses are, but we don't actually, to my knowledge, collaborate on the cases. We do our work and they do their work, to my knowledge."

--Brian Scheid, brian.scheid@platts.com
--Edited by Jeff Barber, jeff.barber@platts.com