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Notice

Cheniere Marketing, LLC; Application for Blanket Authorization To Export Liquefied Natural Gas

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AGENCY:

Office of Fossil Energy, DOE.

ACTION:

Notice of application.

SUMMARY:

The Office of Fossil Energy (FE) of the Department of Energy (DOE) gives notice of receipt of an application, filed on March 23, 2010, by Cheniere Marketing, LLC (CMI), requesting blanket authorization to export liquefied natural gas (LNG) that previously had been imported into the United States from foreign sources in an amount up to the equivalent of 500 Billion cubic feet (Bcf) of natural gas on a short-term or spot market basis. The LNG would be exported from the Sabine Pass LNG terminal owned by CMI's affiliate, Sabine Pass LNG, L.P., in Cameron Parish, Louisiana to any country with the capacity to import LNG via ocean-going carrier and with which trade is not prohibited by U.S. law or policy, over a two year period commencing on the date of the authorization. In addition, CMI requests that FE vacate the blanket authorization issued in DOE/FE Order 2651 on June 8, 2009, requesting the export of previously imported LNG, as amended by Order 2651-A on July 31, 2009, (Orders 2651 and 2651-A) effective on the date of the proposed authorization. The proposed authorization will supersede CMI's current authorization.

The application was filed under section 3 of the Natural Gas Act (NGA) (15 U.S.C. 717b), as amended by section 201 of the Energy Policy Act of 1992 (Pub. L. 102-486) and part 590 of DOE's regulations, 10 CFR part 590 (2009). Protests, motions to intervene, notices of intervention, and written comments are invited.

DATES:

Protests, motions to intervene or notices of intervention, as applicable, requests for additional procedures, and written comments are to be filed at the address listed below no later than 4:30 p.m., eastern time, May 17, 2010.

ADDRESSES:

U.S. Department of Energy (FE-34), Office of Oil and Gas Global Security and Supply, Office of Fossil Energy, Forrestal Building, Room 3E-042, 1000 Independence Avenue, SW., Washington, DC 20585.

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FOR FURTHER INFORMATION CONTACT:

Larine Moore or Beverly Howard, U.S. Department of Energy (FE-34), Office of Oil and Gas Global Security and Supply, Office of Fossil Energy, Forrestal Building, Room 3E-042, 1000 Independence Avenue, SW., Washington, DC 20585, (202) 586-9478; (202) 586-9387.

Edward Myers, U.S. Department of Energy, Office of General Counsel, Fossil Energy and Energy Efficiency, Forrestal Building, Room 6B-159, 1000 Independence Ave., SW., Washington, DC 20585, (202) 586-3397.

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SUPPLEMENTARY INFORMATION:

Background

CMI is a Delaware limited liability company with its principal place of business in Houston, Texas. CMI is a wholly-owned subsidiary of Cheniere Energy, Inc. (Cheniere Energy), which is also a Delaware corporation with its primary place of business in Houston, Texas. Cheniere Energy is a developer of LNG import terminals and natural gas pipelines on the U.S. Gulf Coast, including the Sabine Pass LNG terminal.

On June 8, 2009, FE granted CMI blanket authorization to export on its own behalf or as agent for others LNG that previously had been imported from foreign sources in an amount up to the equivalent of 64 Bcf of natural gas on a cumulative basis. The authorization permitted such exports on a short term or spot market basis from the Sabine Pass LNG terminal to the United Kingdom, Belgium, Spain, France, Italy, Portugal, Turkey, Brazil, Argentina, Chile, Mexico, the Dominican Republic, Japan, South Korea, India, China, and/or Taiwan over a two-year period commencing on the date of the authorization. On July 31, 2009, the authorization was amended to reflect a name change from Cheniere Marketing, Inc to Cheniere Marketing, LLC.[1]

On January 23, 2009, FE granted CMI blanket authorization to import LNG from various international sources for a two-year term beginning on January 29, 2009.[2] Under the terms of the blanket authorization the LNG may be imported at any LNG receiving facility in the United States and its territories.

Current Application

In the instant application, CMI is seeking blanket authorization to export from the Sabine Pass LNG terminal LNG that has been previously imported from foreign sources to any country with the capacity to import LNG via ocean-going carrier and with which trade is not prohibited by U.S. law or over a two-year period, on a short-term or spot market basis, in an amount up to the equivalent of 500 Bcf of natural gas. CMI is also concurrently seeking to vacate Order 2651, as amended by Order 2651-A since the proposed authorization will supersede its current authorization. CMI states that no additional physical modifications to the Sabine Pass LNG terminal are required to accommodate the export authorization requested.Start Printed Page 19955

Public Interest Considerations

In support of its application, CMI states that pursuant to Section 3 of the NGA, FE is required to authorize exports to a foreign country unless there is a finding that such exports “will not be consistent with the public interest.” [3] CMI states that section 3 thus creates a statutory presumption in favor of approval of this Amendment which opponents bear the burden of overcoming.[4] CMI states further, in evaluating an export application, FE applies the principles described in DOE Delegation Order No. 0204-111, which focuses primarily on domestic need for the gas to be exported, and the Secretary's natural gas policy guidelines.[5] Finally, as detailed below, CMI states that their proposal to export LNG to those countries with the capacity to import LNG via ocean-going carrier and with which trade is not prohibited by U.S. law or policy is consistent with Section 3 of the NGA and FE's policy.

CMI states that in DOE/FE Order No. 2651, which granted CMI blanket authorization to export up to 64 Bcf (cumulative) of previously imported foreign-sourced LNG, FE determined that there presently is no domestic reliance on the volumes of imported LNG that CMI would seek to export. CMI also states that in November 2009, FE made the same finding in granting ConocoPhillips Company (ConocoPhillips) blanket authority to export from the Freeport LNG Development, L.P. Quintana Island terminal up to 500 Bcf of previously imported LNG.[6] CMI points out that FE stated that “the record shows there is sufficient supply of natural gas to satisfy domestic demand from multiple other sources at competitive prices without drawing on the LNG which ConocoPhillips seeks to export.* * *” [7]

CMI is requesting authorization, for itself and as agent for third parties, to periodically export LNG imported under DOE/FE Order No. 2606, as well as LNG of third parties, to any other country with the capacity to import LNG via ocean-going vessel and with which trade is not prohibited by U.S. law or policy, should market conditions in the United States not support domestic sale of those supplies. CMI states that granting of CMI's short term blanket authorization as requested herein would provide CMI with the necessary flexibility it requires to respond to changes in domestic and global markets for natural gas and LNG. CMI states that the additional flexibility sought herein would further encourage CMI to obtain and store spot market LNG cargoes. Natural gas derived from imported LNG will be available to supply local markets when conditions support it, and will thereby serve to moderate U.S. gas price volatility. As such, CMI states the requested export authorization is consistent with the public interest.

DOE/FE Evaluation

This export application will be reviewed pursuant to section 3 of the NGA, as amended, and the authority contained in DOE Delegation Order No. 00-002.00I (Nov. 10, 2009) and DOE Redelegation Order No. 00-002.04D (Nov. 6, 2007). In reviewing this LNG export application, DOE will consider domestic need for the gas, as well as any other issues determined to be appropriate, including whether the arrangement is consistent with DOE's policy of promoting competition in the marketplace by allowing commercial parties to freely negotiate their own trade arrangements. Parties that may oppose this application should comment in their responses on these issues.

CMI states that since no changes to the Sabine Pass LNG facilities would be required for CMI's proposed exportation of LNG. CMI asserts that consequently, granting this application will not be a Federal action significantly affecting the human environment within the meaning of the National Environmental Policy Act, 42 U.S.C. 4321 et seq. CMI states therefore, an environmental impact statement or environmental assessment is not required.

The National Environmental Policy Act (NEPA), 42 U.S.C. 4321 et seq., requires DOE to give appropriate consideration to the environmental effects of its proposed decisions. No final decision will be issued in this proceeding until DOE has met its NEPA responsibilities.

Public Comment Procedures

In response to this notice, any person may file a protest, motion to intervene or notice of intervention and written comments, as provided in DOE's regulations at 10 CFR 590.301, et seq. Any person wishing to become a party to the proceeding and to have their written comments considered as a basis for any decision on the application must file a motion to intervene or notice of intervention, as applicable. The filing of a protest with respect to the application will not serve to make the protestant a party to the proceeding, although protests and comments received from persons who are not parties will be considered in determining the appropriate action to be taken on the application. All protests, motions to intervene, notices of intervention, and written comments must meet the requirements specified by the regulations in 10 CFR part 590. Protests, motions to intervene, notices of intervention, requests for additional procedures, and written comments shall be filed with the Office of Oil and Gas Global Security and Supply at the address listed above.

A decisional record on the application will be developed through responses to this notice by parties, including the parties' written comments and replies thereto. Additional procedures will be used as necessary to achieve a complete understanding of the facts and issues. A party seeking intervention may request that additional procedures be provided, such as additional written comments, an oral presentation, a conference, or trial-type hearing. Any request to file additional written comments should explain why they are necessary. Any request for an oral presentation should identify the substantial question of fact, law, or policy at issue, show that it is material and relevant to a decision in the proceeding, and demonstrate why an oral presentation is needed. Any request for a conference should demonstrate why the conference would materially advance the proceeding. Any request for a trial-type hearing must show that there are factual issues genuinely in dispute that are relevant and material to a decision and that a trial-type hearing is necessary for a full and true disclosure of the facts.

If an additional procedure is scheduled, notice will be provided to all parties. If no party requests additional procedures, a final Opinion and Order may be issued based on the official record, including the application and responses filed by parties pursuant to this notice, in accordance with 10 CFR 590.316.

The application filed by CMI is available for inspection and copying in the Office of Oil and Gas Global Security and Supply docket room, 3E-042, at the above address. The docket room is open between the hours of 8 a.m. and 4:30 p.m., Monday through Friday, except Federal holidays. The application is also available Start Printed Page 19956electronically by going to the following Web address: http://www.fe.doe.gov/​programs/​gasregulation/​index.html.

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Issued in Washington, DC, on April 9, 2010.

John A. Anderson,

Manager, Natural Gas Regulatory Activities, Office of Oil and Gas Global Security and Supply, Office of Fossil Energy.

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Footnotes

1.  Cheniere Marketing, LLC, DOE/FE Order Nos. 2651 and 2651-A, issued June 8, 2009 and July 31, 2009 respectively.

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2.  Cheniere Marketing LLC, DOE/FE Order No. 2606 issued January 23, 2009.

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4.  In Panhandle Producers and Royalty Owners Associations v. ERA, 822 F.2d 1105, 1111 (D.D. Circ. 1987), the court found that Section 3 of the NGA “requires an affirmative showing of inconsistency with the public interest to deny an application” and that a “presumption favoring * * * authorization * * * is completely consistent with, if not mandated by, the statutory directive.”

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5.  See 49 FR 6684, February 22, 1984.

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6.  ConocoPhillips, DOE/FE Order No. 2731, November 30, 2009.

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7.  Id. at p. 11.

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[FR Doc. 2010-8753 Filed 4-15-10; 8:45 am]

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