Obama Administration Approves Second Gas Export Facility
In a closely watched decision, the Obama Administration has approved a second terminal to ship liquefied natural gas (LNG) overseas, according to the Washington Post:
The Energy Department said Friday that it had given preliminary authorization to Freeport LNG Expansion L.P. and FLNG Liquefaction LLC to export up to 1.4 billion cubic feet per day of liquefied natural gas from its existing facility in Quintana Island, Texas. The Freeport project is a joint venture between ConocoPhillips and other private investors.
Energy Department approval is needed for exports to countries with which the U.S. doesn’t have a free-trade agreement, a category that includes major trading partners in Europe and Asia. The project still requires final approval from the Federal Energy Regulatory Commission.
The Freeport terminal is the second export facility approved by the Obama administration. Cheniere Energy Inc.’s Sabine Pass facility in Louisiana won approval to export LNG to the non-FTA countries in May 2011.
The push to export comes as the gas industry has seen a boom in shale production that has depressed prices in the U.S., while prices overseas remain high.
The industry welcomed the news, but continued to press for more approvals.
“While this is a positive step, we would like for the administration to pick up the pace of approvals so that the markets can decide which projects go forward.” said America’s Natural Gas Alliance President and CEO Marty Durbin in a statement.
“One export permit is a step in the right direction, but many more job and revenue creating projects are still waiting for approval,” said Erik Milito of the American Petroleum Insitute in a statement.
The Department of Energy is considering a number of new applications for LNG export terminals. As StateImpact Pennsylvania reported earlier this month, one proposal is along the Chesapeake Bay and has environmental groups concerned :
One of those proposals would be in Cove Point, Maryland, a facility owned by Dominion Resources along the Chesapeake Bay. It’s the closest proposal to Pennsylvania’s Marcellus Shale. A coalition of environmental groups has filed public comments against the plan. The Sierra Club, along with a number of local groups have asked the Federal Energy Regulatory Commission, or FERC, to prepare an Environmental Impact Statement on the project.
“The communities that surround the Chesapeake depend on the Bay and its rivers for our food, livelihood and way of life,” said Robin Broder, Vice President of Potomac Riverkeeper in a release. “It’s unthinkable that federal officials would rubber stamp this project without a careful look at how our Bay and upstream communities and natural resources will be affected by increased fracking for natural gas.”
The groups say their greatest concern is the increase in ship traffic in the Bay, which could release wastewater while carrying the highly explosive LNG.