[Federal Register Volume 70, Number 170 (Friday, September 2, 2005)]
[Proposed Rules]
[Pages 52328-52336]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-17480]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
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 

  Federal Register / Vol. 70, No. 170 / Friday, September 2, 2005 / 
Proposed Rules  

[[Page 52328]]



DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Parts 153, 157 and 375

[Docket No. RM05-31-000]


Regulations Implementing Energy Policy Act of 2005; Pre-Filing 
Procedures for Review of LNG Terminals and Other Natural Gas Facilities

Issued August 26, 2005.
AGENCY: Federal Energy Regulatory Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Energy Regulatory Commission (Commission) is 
proposing regulations in accordance with section 311(d) of the Energy 
Policy Act of 2005 (EPAct 2005) to implement mandatory procedures 
requiring prospective applicants to begin the Commission's pre-filing 
review process at least six months prior to filing an application for 
authorization to site and construct a liquefied natural gas (LNG) 
terminal. As proposed, the mandatory procedures would require that the 
prospective applicant submit information necessary for pre-filing 
review of the LNG terminal, as defined in EPAct 2005, as well as any 
pipeline and other natural gas facilities necessary to transport 
regasified LNG from an LNG terminal to existing natural gas pipeline 
infrastructure. As required by EPAct 2005, the proposed regulations are 
designed to encourage applicants to cooperate with state and local 
officials to address safety considerations. A prospective applicant 
also would be required to comply with the pre-filing procedures prior 
to filing an application to make significant modifications to an 
existing LNG terminal likely to involve state and local safety 
considerations. Under the proposed regulations, prospective applicants 
could continue to elect on a voluntary basis to undertake the pre-
filing process prior to filing applications for other facilities 
subject to the Commission's jurisdiction under the Natural Gas Act 
(NGA).

DATES: Comments on the Notice of Proposed Rulemaking are due September 
14, 2005.

ADDRESSES: Comments may be filed electronically via the eFiling link on 
the Commission's Web site at http://www.ferc.gov. Commenters unable to 
file comments electronically must send an original and 14 copies of 
their comments to: Federal Energy Regulatory Commission, Office of the 
Secretary, 888 First Street NE., Washington, DC 20426. Refer to the 
Comment Procedures section of the preamble for additional information 
on how to file comments.

FOR FURTHER INFORMATION CONTACT: Richard Hoffmann, Office of Energy 
Projects, 888 First Street, NE., Washington, DC 20426, (202) 502-8066, 
[email protected].

John Leiss, Office of Energy Projects, 888 First Street, NE., 
Washington, DC 20426, (202) 502-8058, [email protected].

Whit Holden, Office of the General Counsel, Federal Energy Regulatory 
Commission, 888 First Street, NE., Washington, DC 20426, (202) 502-
8089, [email protected].

SUPPLEMENTARY INFORMATION:

I. Introduction

    1. Pursuant to section 311(d) of the Energy Policy Act of 2005 
(EPAct 2005), the Commission is required, by October 7, 2005, to 
promulgate regulations requiring prospective applicants for 
authorization to construct liquefied natural gas (LNG) terminals (as 
defined in EPAct 2005) to comply with the Commission's pre-filing 
review process, beginning at least six months prior to filing an 
application. As further required by EPAct 2005, the proposed 
regulations encourage applicants to cooperate with state and local 
officials.
    2. Prior to any Commission decision regarding an application for 
LNG facilities, the Commission prepares an environmental assessment 
(EA) or environmental impact statement (EIS) to fulfill the 
requirements of the National Environmental Policy Act of 1969 (NEPA), 
42 U.S.C. 4321, et seq., and the Commission's implementing regulations 
under Title 18, Code of Federal Regulations, Part 380, ``Regulations 
Implementing the National Environmental Policy Act.'' The purpose of 
the document is to inform the public and permitting agencies about the 
potential adverse and/or beneficial environmental impacts of proposed 
projects and their alternatives. As with pipeline projects, a thorough 
analysis of any substantive issues relating to LNG facilities is 
undertaken during the preparation of an EA or EIS. The NEPA documents 
for new LNG terminals and expansions at existing sites include a 
thorough study of potential impacts to public safety.
    3. To date, it has been the Commission's policy to encourage early 
involvement by the public and governmental agencies, as contemplated by 
NEPA and Council on Environmental Quality (CEQ) regulations, by 
promoting an optional pre-filing process for both interstate gas 
pipeline and LNG terminal projects. Specifically, in the case of LNG 
project proposals, pre-filing activity is one of three distinct phases 
of activity that the Commission undertakes in fulfilling its goal of 
assuring the safe operation and system reliability of proposed and 
operating jurisdictional LNG facilities throughout the United 
States.\1\
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    \1\ The other two phases of a project timeline for any LNG 
proposal are pre-decision analysis and post-decision construction/
operation inspection and monitoring.
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    4. Typically, prior to filing an LNG-related application, company 
representatives meet with Commission staff to explain the project and 
solicit advice. These meetings provide prospective applicants the 
opportunity for Commission staff to offer suggestions related to 
environmental, engineering, and safety features of the proposal. At 
this stage, Commission staff reviews conceptual designs of planned LNG 
facilities; provides guidance on resolving potential environmental, 
safety, and design issues; explains the level of design detail and 
safety analysis required for a complete application; and assists 
potential applicants in developing plans for ensuring extensive public 
involvement in the application process. In this manner, Commission 
staff learns about future projects which may be filed at the 
Commission, helps companies in their application preparation, and 
ensures that the public is included in the process.

[[Page 52329]]

    5. Because it is desirable to maximize early public involvement to 
promote the wide-spread dissemination of information about proposed 
projects and to reduce the amount of time required to issue an EIS or 
EA once an application is filed, the Commission's Office of Energy 
Projects (OEP) has developed guidelines for going beyond informal 
discussions into a more formal pre-filing process. These guidelines 
were developed because in certain respects the collaborative pre-filing 
procedures for use by prospective applicants set forth in section 
157.22 of the Commission's regulations have proven to be 
impracticable.\2\ Therefore, the Commission is proposing to eliminate 
the collaborative process procedures of section 157.22 in conjunction 
with codification of the pre-filing procedures and regulations proposed 
in this notice.
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    \2\ 18 CFR 157.22 (2005).
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    6. Under the Commission's current guidelines, when a prospective 
applicant elects to undertake the Commission pre-filing process, the 
prospective applicant submits a written request to the Director of OEP 
for staff assistance with the pre-filing process seven to eight months 
prior to filing an application. The request: (1) Explains why the 
prospective applicant wants to use the pre-filing process, including 
time considerations; (2) lists the Federal and state agencies in the 
project area with relevant permitting requirements, documents that 
those agencies are aware of the prospective applicant's intention to 
use the Commission's pre-filing process, provides the Commission with 
contact names and phone numbers, and verifies that the Federal agencies 
agree to participate in this process; (3) identifies other interested 
persons and organizations who have been contacted about the project; 
(4) details what work has been done already, i.e., contacting 
landowners, agency consultants, project engineering, and route 
planning; (5) states that the prospective applicant will provide a list 
of potential third-party contractors who can prepare the requisite NEPA 
document, from which Commission staff will make a selection; (6) 
acknowledges that a complete Environmental Report and complete 
application are still required at the time of filing; and (7) details a 
Public Participation Plan which identifies specific tools and actions 
to facilitate stakeholder communications and public information, 
including establishing a single point of contact. Prospective 
applicants are strongly encouraged to establish a project Web site 
where interested persons can go for information such as copies of 
applications to other agencies. Also, preliminary corridor or route 
information maps are highly desirable.\3\
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    \3\ Section 388.112 of the Commission's regulations, 18 CFR 
388.112 (2005), sets forth procedures to be followed by any person 
submitting documents containing critical energy infrastructure 
information (CEII). These procedures apply only to submissions of 
CEII to the Commission. CEII, as defined in section 388.113 of the 
regulations, includes information about proposed or existing natural 
gas facilities that could be used by a person planning an attack on 
critical energy infrastructure. The Commission's procedures in 
section 388.112 are designed to ensure that CEII is not placed in 
the Commission's public records. The regulations proposed by this 
notice would make the procedures in section 388.112 applicable to 
submissions by prospective applicants using the proposed pre-filing 
review procedures.
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    7. In recent years, Commission staff has sought to promote use of 
the pre-filing process by prospective applicants for all major natural 
gas projects, including LNG projects. If the guidelines for requesting 
the pre-filing process are satisfied by a prospective applicant, a 
written acceptance is issued by the Director of OEP, and a PF docket 
number is assigned.
    8. Commission staff's role in the pre-filing process is to work 
with stakeholders and the prospective applicant to ensure that a 
complete application is prepared, based on a thorough exploration of 
potential issues, and not to take any position on the merits of the 
potential application. Staff and third-party contractor pre-filing 
involvement is designed to encourage and promote a cooperative pre-
filing process. On a case-by-case basis, this involvement will include 
some or all of the following: (1) Assisting the prospective applicant 
in developing initial information about the proposal and identifying 
affected parties (including landowners and agencies); (2) issuing a 
Scoping Notice and conducting scoping for the proposal; (3) 
facilitating issue identification and resolution; (4) conducting site 
visits, examining alternatives, meeting with agencies and stakeholders, 
and participating in the prospective applicant's public information 
meetings; (5) initiating the preparation of a preliminary EA or 
preliminary DEIS, which may include cooperating agency review; and (6) 
reviewing draft resource reports for the application that is to be 
filed with the Commission.
    9. When the application for authorization to construct a pipeline 
project or to site an LNG terminal is filed, the Commission publishes a 
notice of the application in the Federal Register and establishes a 
deadline for interested persons to intervene in the proceeding. Because 
the pre-filing process occurs before an application to begin a 
proceeding is filed, petitions to intervene during this process are 
premature and are not accepted by the Commission.
    10. As noted above, EPAct 2005 requires the Commission implement a 
mandatory, rather than elective, pre-filing process for review of LNG 
terminal facilities prior to a prospective applicant's filing of an 
application for authorization of such facilities. In this regard, 
Congress has directed that the Commission promulgate regulations 
directing that the pre-filing process commence at least 6 months prior 
to the filing of an application and that the regulations encourage 
applicants to cooperate with state and local officials. To fulfill this 
mandate, the Commission is proposing to adopt its existing pre-filing 
process as the mandatory pre-filing process for review of LNG terminal 
facilities and associated jurisdictional pipeline facilities. The 
Commission's experience with the current pre-filing process is that it 
has been used with much success since its introduction several years 
ago. It is a process with which the natural gas industry, governmental 
entities and the public are familiar. To the extent that minor changes 
will improve the current process, we can consider them as a result of 
the comment process in this proceeding.

II. Summary of Proposed Regulations

    11. As discussed above, the proposed regulations, in large measure, 
adopt the formal pre-filing process that the Commission currently 
utilizes when prospective applicants voluntarily elect to use the 
process. First, section 153.2 of the regulations would be amended by 
adding the definition of ``LNG terminal'' set forth in the new section 
3A of the NGA added by section 311(d) of EPAct 2005:

    LNG Terminal means all natural gas facilities located onshore or 
in State waters that are used to receive, unload, load, store, 
transport, gasify, liquefy, or process natural gas that is imported 
to the United States from a foreign country, exported to a foreign 
country from the United States, or transported in interstate 
commerce by a waterborne vessel, but does not include:
    (1) Waterborne vessels used to deliver natural gas to or from 
any such facility; or
    (2) Any pipeline or storage facility subject to the jurisdiction 
of the Commission under section 7 of the Natural Gas Act.

    12. A proposed new paragraph (c) would be added to section 153.6 to 
state that no application for an LNG terminal or associated 
jurisdictional pipeline facilities may be made before 180 days after 
the date of a notice by the Director

[[Page 52330]]

of OEP announcing commencement of a prospective applicant's pre-filing 
process under the procedures of proposed new section 157.21, described 
below. A new definition would be added to section 157.1 to provide 
that, for the purposes of section 157.21, ``Director'' means the 
Director of the Commission's Office of Energy Projects.
    13. Proposed new section 157.21 would establish the pre-filing 
process for LNG terminal facilities, as well as other natural gas 
facilities. The procedures would be mandatory for any prospective 
applicant for authorization to site, construct and operate facilities 
included within the definition of ``LNG terminal,'' as defined in 
proposed section 153.2(d), and for any associated jurisdictional 
pipeline facilities. The pre-filing procedures also would be mandatory 
in cases where the Director finds that significant modifications to 
existing LNG terminal facilities involve state and local safety 
considerations. As discussed below, the pre-filing review process would 
remain voluntary for natural gas facilities not related to LNG 
terminals.
    14. To initiate the pre-filing review process under proposed 
section 157.21, a prospective applicant for LNG terminal facilities 
would be required to make a filing containing certain material, as 
described below, and concurrently file a Letter of Intent and a 
Preliminary Waterway Suitability Assessment (WSA) with the U. S. Coast 
Guard.\4\
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    \4\ Information concerning these documents may be found in the 
U. S. Coast Guard Navigation and Vessel Inspection Circular No. 05-
05, dated June 14, 2005.
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    15. Proposed section 157.21(a)(2) would provide that an application 
for LNG terminal facilities and associated jurisdictional pipeline 
facilities (1) shall not be filed until at least 180 days after the 
date that the Director issues notice of the commencement of the 
prospective applicant's pre-filing process, and (2) shall contain all 
the information specified by Commission staff.
    16. The information that a prospective applicant would be required 
to submit pursuant to section 157.21(a)(2) would include draft 
environmental material in accordance with the provisions of Part 380 of 
the regulations implementing the Commission's procedures under NEPA. 
The requirements in Part 380 of the Commission's regulations supplement 
the CEQ's regulations.\5\ The procedures in Part 380 essentially follow 
CEQ procedures concerning early and efficient review of environmental 
issues, public notice and participation, scoping, interagency 
cooperation, comments, and timing of decisions on proposals.
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    \5\ The CEQ's regulations are set out at 40 CFR parts 1500 
through 1508 (2005).
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    17. The environmental material required by the Part 380 regulations 
is embodied in sections 380.12, 380.13, 380.14 and 380.15 and Appendix 
A to Part 380. Section 380.12 describes resource reports which list, in 
detail, the information the Commission needs to conduct an 
environmental review of a proposal under NEPA. It consists of 13 
resource reports ranging from a detailed project description to 
descriptions of the existing environment and potential impacts on 
environmental resources such as water use and quality, fish, wildlife 
and vegetation, cultural resources, land use and aesthetics, and air 
and noise and, for LNG terminal facilities, engineering and design 
material.
    18. Sections 380.13 and 380.14 provide procedures and detailed 
descriptions of what the prospective applicant is expected to do to 
help the Commission comply with its obligations under the Endangered 
Species Act and the National Historic Preservation Act. Section 380.15 
identifies best practices for the prospective applicant to follow when 
siting and maintaining facilities. Appendix A to Part 380 is a 
checklist of minimum environmental filing requirements.
    19. Currently, when a prospective applicant elects to undertake the 
Commission's voluntary pre-filing procedures, it is required to use or 
file, as appropriate, all of the above-described Part 380 materials as 
it formulates its project and then files the application with the 
Commission. The proposed procedures would require that prospective 
applicants required or requesting to use the pre-filing process file 
draft environmental material in accordance with the provisions of Part 
380 of the regulations implementing the Commission's procedures under 
NEPA, as described above. This would allow the Commission to review and 
make suggestions on how they could be improved before the filing of the 
application.
    20. Proposed section 157.21(a)(3) would require that a prospective 
applicant for LNG terminal facilities and any associated jurisdictional 
pipeline facilities provide any necessary information for the 
environmental review of any pipeline or other natural gas facilities 
which are necessary to transport regasified LNG from the subject LNG 
terminal facilities to the existing natural gas pipeline 
infrastructure. Such facilities would include facilities not subject to 
the Commission's NGA jurisdiction, such as intrastate pipeline and 
Hinshaw pipeline facilities that will be interconnected with the LNG 
terminal.
    21. Proposed section 157.21(b) also states that a prospective 
applicant approved to use the pre-filing procedures for facilities not 
related to LNG terminal facilities should not file an application until 
at least 180 days after the date that the Director issues a notice 
approving use of the pre-filing procedures. However, whereas a 
prospective applicant for LNG facilities would be precluded from filing 
an application before the 180-day period has ended, the proposed 
regulations do not preclude a prospective applicant for facilities not 
related to LNG facilities from filing an application within 180 days.
    22. Any prospective applicant required to use the pre-filing 
process for LNG terminal facilities and related facilities or any 
prospective applicant requesting to use the pre-filing process for non-
LNG related facilities would be required by proposed section 157.21(c) 
to first consult with the Director on the nature of the project, the 
content of the pre-filing request, and the status of the prospective 
applicant's progress toward obtaining the information required for the 
pre-filing request described in paragraph (d) of this section. This 
consultation will also include discussion of the specifications for the 
applicant's solicitation for prospective third-party contractors to 
prepare the environmental documentation for the project.
    23. Proposed section 157.21(d) identifies the information that a 
prospective applicant's initial filing to initiate the pre-filing 
process must include. For LNG terminal facilities, the initial filing 
must include a description of the schedule desired for the project, 
including the expected application filing date and the desired date for 
Commission approval, and a description of the zoning and availability 
of the proposed site and marine facility location.
    24. For natural gas facilities not related to LNG terminal 
facilities, proposed section 157.21(d) provides that a prospective 
applicant's initial filing must include an explanation of why the 
prospective applicant wants to use the process, including any critical 
timing considerations, the expected application filing date and the 
desired date for Commission approval.
    25. Filings by all prospective applicants to initiate the pre-
filing process would be required by proposed section 157.21(d) to 
include:
     A detailed description of the project that will serve as 
the initial discussion point for stakeholder review;

[[Page 52331]]

     A list of the relevant Federal and state agencies in the 
project area with permitting requirements, and a statement indicating 
that those agencies are aware of the prospective applicant's intention 
to use the pre-filing process (including contact names and telephone 
numbers) and whether the agencies have agreed to participate in the 
process;
     A list and description of the interest of other persons 
and organizations who have been contacted about the project (including 
contact names and telephone numbers);
     A description of what work has already been done, e.g., 
contacting stakeholders, agency consultations, project engineering, 
route planning, environmental and engineering contractor engagement, 
environmental surveys/studies, and open houses;
     Proposals for at least three prospective third-party 
contractors from which Commission staff may make a selection;
     Acknowledgement that a complete Environmental Report and 
complete application are required at the time of filing; and
     A description of a Public Participation Plan which 
identifies specific tools and actions to facilitate stakeholder 
communications and public information, including a project website and 
a single point of contact.
    26. Proposed section 157.21(e) states that the pre-filing process 
for a prospective applicant will be deemed to have commenced on the 
date the Director issues a notice setting forth a finding that the 
prospective applicant has adequately addressed the requirements of 
paragraphs (a) through (d) of section 157.21. The date of such notice 
shall be used in determining whether the date an application is filed 
is at least 180 days after commencement of the pre-filing process. 
Proposed section 157.21(e) also provides for the Director to make 
determinations whether prospective modifications to an existing LNG 
terminal will be significant modifications involving state and local 
safety considerations. Such prospective modifications to existing LNG 
facilities will require that the prospective applicant undertake the 
pre-filing review process.
    27. Existing section 375.308(z) describes the Director's delegated 
authority with respect to the collaborative pre-filing procedures in 
section 157.22, which this proposed rule would remove from the 
regulations in view of the proposed implementation of the pre-filing 
procedures and review provided for in proposed new section 157.21. 
Therefore, the Commission is proposing to remove the existing text in 
paragraph (z) in section 375.208 and replace it with new text which 
would provide for the Director's issuance of notices to commence the 
pre-filing process under proposed new section 157.21, after the 
Director has found that a prospective applicant has adequately 
addressed the above-described requirements. The proposed new text in 
section 375.308(z) also provides for the Director to post guidance on 
the Commission's website to clarify the procedures and how prospective 
applicants can achieve compliance with the pre-filing process and 
regulations.
    28. Proposed section 157.21(f) provides that, upon the Director's 
issuance of a notice commencing a prospective applicant's pre-filing 
process, the prospective applicant must:
     Within seven days \6\ and after consultation with 
Commission staff, establish and notify Commission staff of the dates 
and locations at which the prospective applicant will conduct open 
houses and meetings with stakeholders (including agencies) and 
Commission staff.
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    \6\ As provided in Rule 2007 of the Commission's Rules of 
Practice and Procedure, 18 CFR 385.2007 (2005), the day on which the 
Director's notice is issued would be excluded in counting days for 
purposes of determining the date a filing is due. Further, if the 
due date for a filing would fall on a Saturday, Sunday, holiday, or 
day on which the Commission closes early due to adverse conditions, 
the following business day becomes the due date.
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     Within 14 days, conclude the contract with the selected 
third-party contractor.
     Within 14 days, contact all stakeholders not already 
informed about the project.
     Within 30 days, submit a stakeholder mailing list to 
Commission staff.
     Within 30 days, file a draft of Resource Report 1 in 
accordance with Sec.  380.12(c) and a summary of the alternatives 
considered or under consideration.
     On a monthly basis, file status reports detailing the 
applicant's project activities including surveys, stakeholder 
communications, and agency meetings.
     Be prepared to provide a description of the proposed 
project and to answer questions from the public at the scoping meetings 
held by Commission staff.
     Be prepared to attend site visits and other stakeholder 
and agency meetings arranged by the Commission staff, as required.
     Within 14 days of the end of the scoping comment period, 
respond to issues raised during scoping.
     Within 60 days of the end of the scoping comment period, 
file draft Resource Reports 1 through 12.
     At least 60 days prior to filing an application, file 
revised draft Resource Reports, if requested by Commission staff.
     At least 90 days prior to filing an application, file 
draft Resource Report 13 (for LNG terminal facilities).
     Certify that a Follow-on WSA will be submitted to the U.S. 
Coast Guard no later than the filing of an application with the 
Commission for LNG terminal facilities.
    29. Proposed section 157.21(g) provides that Commission staff and 
third-party contractor involvement during the pre-filing process will 
be designed to fit each project and will include some or all of the 
following:
     Assisting the prospective applicant in developing initial 
information about the proposal and identifying affected parties 
(including landowners, agencies, and other interested parties).
     Issuing an environmental scoping notice and conducting 
scoping for the proposal.
     Facilitating issue identification and resolution.
     Conducting site visits, examining alternatives, meeting 
with agencies and stakeholders, and participating in the prospective 
applicant's public information meetings.
     Reviewing draft Resource Reports.
     Initiating the preparation of a preliminary EA or draft 
EIS, which may include cooperating agency review.
    30. Paragraph (h) of proposed section 157.21 would provide that a 
prospective applicant using the pre-filing procedures shall comply with 
the procedures in section 388.112 of the regulations for the submission 
of documents containing CEII, as defined in section 388.113 of the 
regulations.
    31. Once an application is accepted by the Commission, whether the 
environmental analysis can proceed will be highly dependent on how well 
the applicant responded to issues raised by Commission staff and the 
stakeholders during the pre-filing process described above.

III. Environmental Analysis

    32. The Commission is required to prepare an EA or EIS for any 
action that may have a significant adverse effect on the human 
environment.\7\ No environmental consideration is raised by the 
promulgation of a rule that is

[[Page 52332]]

procedural in nature or does not substantially change the effect of 
legislation or regulations being amended.\8\
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    \7\ Order No. 486, Regulations Implementing the National 
Environmental Policy Act, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & 
Regs. Preambles 1986-1990 ] 30,783 (1987).
    \8\ 18 CFR 380.4(a)(2)(ii) (2005).
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    33. The regulations proposed herein would establish pre-filing 
review procedures which are mandatory for prospective applicants for 
LNG terminal and any associated jurisdictional pipeline facilities and 
elective for prospective applicants for natural gas facilities not 
related to LNG terminals. In neither case do the procedures 
substantially change the regulatory requirements to which applications 
for such facilities are subject. Rather, the proposed procedures would 
result in certain regulatory requirements being satisfied prior to the 
filing of an application, as opposed to being satisfied at the time, or 
after the filing, of the application. The use of the procedures 
generally will affect the timing of the filing of applications, not 
when regulatory requirements are met. Further, the proposed procedures 
implement regulatory changes mandated by Congress in EPAct 2005 for new 
LNG terminals.

IV. Regulatory Flexibility Act Statement

    34. The Regulatory Flexibility Act of 1980 (RFA) \9\ generally 
requires a description and analysis of proposed regulations that will 
have significant economic impact on a substantial number of small 
entities. The Commission is not required to make such an analysis if 
proposed regulations would not have such an effect. Under the industry 
standards used for purposes of the RFA, a natural gas pipeline company 
qualifies as ``a small entity'' if it has annual revenues of $6 million 
or less.
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    \9\ 5 U.S.C. 601-612.
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    35. Most companies regulated by the Commission do not fall within 
the RFA's definition of a small entity.\10\ Based on the Commission's 
experience using the proposed pre-filing procedures, they will only be 
used for major construction projects. Most, if not all, LNG-related 
projects subject to mandatory pre-filing review would be projects 
costing millions of dollars. Most, if not all, non-LNG related projects 
for which prospective applicants will elect to use the proposed pre-
filing procedures will be projects costing millions of dollars. Because 
of the scale and nature of projects likely to be reviewed under the 
pre-filing procedures, the Commission doubts that any existing or new 
company using the pre-filing procedures will be a small entity under 
the RFA's standards. Accordingly, the Commission hereby certifies that 
this notice's proposed regulations, if promulgated, will not have a 
significant economic impact on a substantial number of small entities.
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    \10\ 5 U.S.C. 601(3), citing to section 3 of the Small Business 
Act, 15 U.S.C. 623. Section 3 of the Small Business Act defines a 
``small-business concern'' as a business which is independently-
owned and operated and which is not dominant in its field of 
operation.
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V. Information Collection Statement

    36. The Office of Management and Budget (OMB) regulations require 
that OMB approve certain reporting, record keeping, and public 
disclosure (collections of information) imposed by an agency.\11\ 
Accordingly, pursuant to OMB regulations, the Commission is providing 
notice of its proposed information collections to OMB for review under 
section 3507(d) of the Paperwork Reduction Act of 1995.\12\
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    \11\ 5 CFR 1320.11 (2005).
    \12\ 44 U.S.C. 3507(d) (2005).
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    37. FERC-539, ``Gas Pipeline Certificates: Import/Export Related,'' 
identifies the Commission's information collections relating to Part 
153 of its regulations, which apply to facilities to import or export 
natural gas and for which authorization under section 3 of the NGA is 
necessary. If planned import or export facilities will be LNG terminal 
facilities, as defined in proposed section 153.2(d), the facilities 
will be subject to the mandatory pre-filing review required by proposed 
section 157.21. A prospective applicant for non-LNG related import and 
export facilities may choose to request approval to undertake the pre-
filing procedures in proposed section 157.21.
    38. FERC-537, ``Gas Pipeline Certificates: Construction, 
Acquisition and Abandonment,'' identifies the Commission's information 
collections relating to Part 157 of its regulations, which apply to 
natural gas facilities for which authorization under section 7 of the 
NGA is required. Such facilities will be subject to the mandatory pre-
filing review required by proposed section 157.21 only if they are 
included within the definition of LNG terminal facilities, as defined 
in proposed section 153.2(d) or, more likely, are necessary to 
transport regasified gas away from LNG terminal facilities. A 
prospective applicant for non-LNG related NGA section 7 facilities may 
choose to request approval to undertake the pre-filing procedures in 
proposed section 157.21.
    39. FERC-577, ``Gas Pipeline Certificates: Environmental Impact 
Statement,'' identifies the Commission's information collections 
relating to Part 380 implementing NEPA requirements relating to the 
construction of natural gas facilities. As proposed herein, prospective 
applicants using the pre-filing procedures, whether on a mandatory or 
voluntary basis, will be subject to the requirements of Part 380.
    40. The Commission's information collections relating to this 
notice's proposed pre-filing procedures are described in this notice. 
The Commission has submitted this notice to OMB for review and 
clearance of the notice's information collection requirements under 
emergency processing procedures.\13\ OMB approval has been requested by 
[INSERT DATE].
---------------------------------------------------------------------------

    \13\ 5 CFR 1320.13 (2005).
---------------------------------------------------------------------------

    41. Comments are solicited on the Commission's need for this 
information, whether the information will have practical utility, the 
accuracy of the provided burden estimates, ways to enhance the quality, 
utility, and clarity of the information to be collected, and any 
suggested methods for minimizing respondent's burden, including the use 
of automated information techniques.
    42. The Commission has been using its current voluntary pre-filing 
procedures for approximately four years. Thus, the Commission has 
experience that it did not have when it proposed existing section 
157.22 of the regulations, which this proposed rule would eliminate. 
Based on this experience, the Commission believes that there will be no 
more than 20 prospective applicants that use the proposed pre-filing 
review procedures on an annual basis. The Commission anticipates that 
this number will include no more than five prospective applicants for 
LNG terminal facilities. During the four years that prospective 
applicants have had the option of using the Commission's current 
voluntary pre-filing procedures, all but three prospective applicants 
for LNG terminal projects have elected to undertake the pre-filing 
procedures. Thus, the adoption of mandatory pre-filing procedures for 
LNG facilities is not expected to significantly increase the number of 
prospective LNG applicants that use the pre-filing procedures, as 
mandated by Congress in EPAct 2005.
    43. The burden estimates for complying with additional filing 
requirements of this rule pursuant to the procedures in proposed new 
section 157.21 are set forth below. As reflected, the burden estimates 
are higher for a respondent/prospective applicant for LNG terminal 
facilities than for a

[[Page 52333]]

respondent/prospective applicant for other natural gas facilities.

----------------------------------------------------------------------------------------------------------------
                                                     Number of       Number of       Hours per     Total annual
                 Data collection                    respondents      responses       response          hours
----------------------------------------------------------------------------------------------------------------
FERC-537........................................              10               1              47             470
                                                 -----------------
FERC-539........................................              10               1             103           1,030
FERC-577........................................              20               1           1,402          28,040
                                                 -----------------
    Totals......................................  ..............  ..............  ..............          29,540
----------------------------------------------------------------------------------------------------------------

    From these burden estimates must be subtracted the original data 
collection requirements in OMB's record relating to section 157.22 
which this notice proposes to remove from the Commission's regulations. 
The numbers in OMB's record for section 157.22 are:
    FERC-537: 13,230 hours.
    FERC-539: 270 hours.
    FERC-577: 13,580 hours.
    When the burden estimates for proposed section 157.21 are reduced 
to reflect the removal of section 157.22, the net data collection 
estimates for this rule are:
    FERC-537: -12,760 hours.
    FERC-539: 760 hours.
    FERC-577: 14,460 hours.
    Total: 2,460 hours (net increase).
    Total Annual Hours for Collection: 2,460 hours. For LNG terminal 
facilities and LNG-related pipeline facilities, these are mandatory 
information collection requirements. For non-LNG related natural gas 
facilities, these information collection requirements are voluntary but 
are still subject to OMB review.
    Information Collection Costs: The Commission seeks comments on the 
cost to comply with these requirements. It has projected the average 
annualized cost for all respondents to be $4,920,000 (2,460 hours x 
$100.00 per hour x 20 respondents).
    Title: FERC-537 ``Gas Pipeline Certificates: Construction, 
Acquisition and Abandonment''; FERC-539, ``Gas Pipeline Certificates: 
Import/Export Related''; FERC-577, ``Gas Pipeline Certificates: 
Environmental Impact Statement.''
    Action: Proposed Information Collection.
    OMB Control Nos.: 1902-0060 (FERC-537); 1902-0062 (FERC-539); 1902-
0128 (FERC-577). The applicant shall not be penalized for failure to 
respond to these collections of information unless the collections of 
information display valid OMB control numbers.
    Respondents: Business or other for profit.
    Frequency of Responses: One-time implementation.
    Necessity of Information: On August 8, 2005, Congress enacted EPAct 
2005. Section 311(d) of EPAct 2005 amends the NGA to insert a new 
section, section 3A, which requires that the Commission shall 
promulgate regulations on the pre-filing process for LNG terminals 
within 60 days from enactment of EPAct 2005. Congress and the 
Commission consider the promulgation of these regulations to be a 
matter of critical importance to the state and local safety concerns 
regarding the construction and development of LNG terminals. The 
Commission must issue a final rule by October 7, 2005. The Commission 
seeks emergency processing of this proposed information collection 
because the use of normal clearance procedures is reasonably likely to 
cause a statutory deadline to be missed. The proposed rule revises the 
requirements contained in 18 CFR parts 157 and 153 to add a requirement 
that applicants for authorization to construct LNG terminals must 
comply with a pre-filing process and that such process must commence at 
least 6 months prior to the filing of any application with the 
Commission for authorization to construct such facilities.
    Internal Review: The Commission has assured itself, by means of 
internal review, that there is specific, objective support for the 
burden estimates associated with the information requirements. The 
Commission's Office of Energy Projects will review the data included in 
the application to determine whether the proposed facilities are in the 
public interest as well as for general industry oversight. This 
determination involves, among other things, an examination of adequacy 
of design, cost, reliability, redundancy, safety and environmental 
acceptability of the proposed facilities. These requirements conform to 
the Commission's plan for efficient information collection, 
communication and management within the natural gas industry.
    44. Interested person may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street, NE., Washington, DC 20426 (Attention: 
Michael Miller, Office of the Executive Director, 202-502-8415, fax: 
202-273-0873, e-mail: [email protected].
    45. For submitting comments concerning the collection of 
information and the associated burden estimate(s) including suggestions 
for reducing this burden, please send your comments to the contact 
listed above and to the Office of Management and Budget, Room 10202 
NEOB, 725 17th Street, NW., Washington, DC 20503 (Attention: Desk 
Officer for the Federal Energy Regulatory Commission, 202-395-4650, 
fax: 202-395-7285).

VI. Public Comment and Expedited Procedures

    46. EPAct 2005 mandates that the Commission promulgate regulations 
implementing the pre-filing process within 60 days of the date of its 
enactment. Therefore, the Commission intends to promulgate final 
regulations by October 7, 2005. To that end, public comments on this 
notice are due on September 14, 2005.
    47. The Commission invites interested persons to submit comments on 
the matters and issues proposed in this notice to be adopted, including 
any related matters or alternative proposals that commenters may wish 
to discuss. The Commission will carefully weigh and consider all public 
comments received.
    48. Comments must refer to Docket No. RM05-31 and must include the 
commenters' names, the organization they represent, if applicable, and 
their address. Comments may be filed either in electronic or paper 
format.
    49. Comments may be filed electronically via the eFiling link on 
the Commission's Web site at http://www.ferc.gov. The Commission 
accepts most standard word processing formats and commenters may attach 
additional files with supporting information in certain other file 
formats. Commenters filing electronically do not need to make a paper 
filing. Commenters that are not able to file comments electronically 
must send an original and 14 copies of their comments to: Federal 
Energy

[[Page 52334]]

Regulatory Commission, Office of the Secretary, 888 First Street NE., 
Washington, DC 20426.
    50. All comments will be placed in the Commission's public files 
and may be viewed, printed, or downloaded remotely as described in the 
Document Availability section below. Commenters on this proposal are 
not required to serve copies of their comments on other commenters.

VII. Document Availability

    51. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through FERC's Home Page (http://www.ferc.gov) and in FERC's 
Public Reference Room during normal business hours (8:30 a.m. to 5 p.m. 
Eastern time) at 888 First Street, NE., Room 2A, Washington DC 20426.
    52. From FERC's Home Page on the Internet, this information is 
available in the Commission's document management system, eLibrary. The 
full text of this document is available on eLibrary in PDF and 
Microsoft Word format for viewing, printing, and/or downloading. To 
access this document in eLibrary, type the docket number excluding the 
last three digits of this document in the docket number field.
    53. User assistance is available for eLibrary and the FERC's Web 
site during normal business hours. For assistance, please contact FERC 
Online Support at 1-866-208-3676 (toll free) or 202-502-6652 (e-mail at 
[email protected]), or the Public Reference Room at 202-502-
8371, TTY (202) 502-8659 (e-mail at [email protected]).

List of Subjects in 18 CFR Part 157

    Administrative practice and procedure; Natural gas; Reporting and 
recordkeeping requirements.

    By direction of the Commission.
Magalie R. Salas,
Secretary.

    In consideration of the foregoing, the Commission proposes to amend 
parts 153, 157 and 375 of Chapter I, Title 18, Code of Federal 
Regulations, as follows:

PART 153--APPLICATIONS FOR AUTHORIZATION TO CONSTRUCT, OPERATE, OR 
MODIFY FACILITIES USED FOR THE EXPORT OR IMPORT OF NATURAL GAS

    1. The authority citation for part 153 continues to read as 
follows:

    Authority: 15 U.S.C. 717b, 717o; E.O. 10485, 3 CFR, 1949-1953 
Comp., p. 970, as amended by E.O. 12038, 3 CFR, 1978 Comp., p. 136, 
DOE Delegation Order No. 0204-112, 49 FR 6684 (February 22, 1984).

    2. In Sec.  153.2, a new paragraph (d) is added, to read as 
follows:


Sec.  153.2  Definitions.

* * * * *
    (d) LNG Terminal means all natural gas facilities located onshore 
or in state waters that are used to receive, unload, load, store, 
transport, gasify, liquefy, or process natural gas that is imported to 
the United States from a foreign country, exported to a foreign country 
from the United States, or transported in interstate commerce by a 
waterborne vessel, but does not include:
    (1) Waterborne vessels used to deliver natural gas to or from any 
such facility; or
    (2) Any pipeline or storage facility subject to the jurisdiction of 
the Commission under section 7 of the Natural Gas Act.
    3. In Sec.  153.6, a new paragraph (c) is added, to read as 
follows:


Sec.  153.6  Time of filing.

* * * * *
    (c) When a prospective applicant for authorization for LNG terminal 
facilities, associated jurisdictional natural gas facilities or 
modifications to existing LNG terminal facilities is required by 18 CFR 
157.21(a) to comply with that section's pre-filing procedures, no 
application for such authorization may be made before 180 days after 
the date of issuance of the notice by the Director of the Office of 
Energy Projects, as provided in 18 CFR 157.21(e), of the commencement 
of the prospective applicant's pre-filing process under 18 CFR 157.21.
    4. Section 153.12 is removed.

PART 157--APPLICATIONS FOR CERTIFICATES OF PUBLIC CONVENIENCE AND 
NECESSITY AND FOR ORDERS PERMITTING AND APPROVING ABANDONMENT UNDER 
SECTION 7 OF THE NATURAL GAS ACT

    5. The authority citation for part 157 continues to read as 
follows:

    Authority: 15 U.S.C. 717-717w; 3301-3432; 42 U.S.C. 7101-7352.

    6. In Sec.  157.1, the introductory text is designated as paragraph 
(a), the definition of Indian tribe is designated as paragraph (a)(1), 
the definition of Resource agency is designated as paragraph (a)(2), 
and a paragraph (b) is added to read as follows:


Sec.  157.1  Definitions.

* * * * *
    (b) For the purposes of Sec.  157.21 of this Part, Director means 
the Director of the Commission's Office of Energy Projects.
    7. Section 157.21 is added, to read as follows:


Sec.  157.21  Pre-filing procedures and review process for LNG terminal 
facilities and other natural gas facilities prior to filing of 
applications.

    (a) LNG terminal facilities and associated jurisdictional pipeline 
facilities. A prospective applicant for authorization to site, 
construct and operate facilities included within the definition of 
``LNG terminal,'' as defined in 18 CFR 153.2(d), and any prospective 
applicant for associated jurisdictional pipeline facilities must comply 
with this section's pre-filing procedures and review process. These 
mandatory pre-filing procedures also shall apply when the Director 
finds in accordance with paragraph (e)(2) of this section that 
prospective modifications to an existing LNG terminal are significant 
modifications that involve state and local safety considerations.
    When a prospective applicant is required by this paragraph to 
comply with this section's pre-filing procedures:
    (1) The prospective applicant must make a filing containing the 
material identified in paragraph (d) of this section and concurrently 
file a Letter of Intent and a Preliminary Waterway Suitability 
Assessment (WSA) with the U.S. Coast Guard. Information concerning the 
documents to be filed with the Coast Guard may be found in the U.S. 
Coast Guard Navigation and Vessel Inspection Circular No. 05-05, dated 
June 14, 2005.
    (2) An application:
    (i) Shall not be filed until at least 180 days after the date that 
the Director issues notice pursuant to paragraph (e) of this section of 
the commencement of the prospective applicant's pre-filing process; and
    (ii) Shall contain all the information specified by the Commission 
staff after reviewing the draft materials filed by the prospective 
applicant during the pre-filing process, including required 
environmental material in accordance with the provisions of Part 380 of 
this chapter, ``Regulations Implementing the National Environmental 
Policy Act.''
    (3) The prospective applicant must provide sufficient information 
for the pre-filing review of any pipeline or other natural gas 
facilities, including facilities not subject the Commission's Natural 
Gas Act jurisdiction, which are necessary to transport regasified LNG 
from the subject LNG terminal facilities to the existing natural gas 
pipeline infrastructure.

[[Page 52335]]

    (b) Other natural gas facilities. When a prospective applicant for 
authorization for natural gas facilities is not required by paragraph 
(a) of this section to comply with this section's pre-filing 
procedures, the prospective applicant may file a request seeking 
approval to use the pre-filing procedures.
    (1) A request to use the pre-filing procedures must contain the 
material identified in paragraph (d) of this section; and
    (2) If a prospective applicant for non-LNG terminal facilities is 
approved to use this section's pre-filing procedures:
    (i) The application will normally not be filed until at least 180 
days after the date that the Director issues notice pursuant to 
paragraph (e) of this section approving the prospective applicant's 
request to use the pre-filing procedures under this section and 
commencing the prospective applicant's pre-filing process. However, a 
prospective applicant approved by the Director pursuant to paragraph 
(e)(2) of this section to undertake the pre-filing process is not 
prohibited from filing an application at an earlier date, if necessary; 
and
    (ii) The application shall contain all the information specified by 
the Commission staff after reviewing the draft materials filed by the 
prospective applicant during the pre-filing process, including required 
environmental material in accordance with the provisions of Part 380 of 
this chapter, ``Regulations Implementing the National Environmental 
Policy Act.''
    (c) Initial consultation. A prospective applicant required or 
requesting to use the pre-filing process must first consult with the 
Director on the nature of the project, the content of the pre-filing 
request, and the status of the prospective applicant's progress toward 
obtaining the information required for the pre-filing request described 
in paragraph (d) of this section. This consultation will also include 
discussion of the specifications for the applicant's solicitation for 
prospective third-party contractors to prepare the environmental 
documentation for the project.
    (d) Contents of the initial filing. A prospective applicant's 
initial filing pursuant to paragraph (a)(1) of this section for LNG 
terminal facilities and associated jurisdictional pipeline facilities 
or paragraph (b)(1) of this section for other natural gas facilities 
shall include the following information:
    (1) A description of the schedule desired for the project including 
the expected application filing date and the desired date for 
Commission approval.
    (2) For LNG terminal facilities, a description of the zoning and 
availability of the proposed site and marine facility location.
    (3) For natural gas facilities other than LNG terminal facilities 
and associated jurisdictional facilities, an explanation of why the 
prospective applicant is requesting to use the pre-filing process under 
this section.
    (4) A detailed description of the project that will serve as the 
initial discussion point for stakeholder review.
    (5) A list of the relevant federal and state agencies in the 
project area with permitting requirements, and a statement indicating 
that those agencies are aware of the prospective applicant's intention 
to use the pre-filing process (including contact names and telephone 
numbers), and whether the agencies have agreed to participate in the 
process.
    (6) A list and description of the interest of other persons and 
organizations who have been contacted about the project (including 
contact names and telephone numbers).
    (7) A description of what work has already been done, e.g., 
contacting stakeholders, agency consultations, project engineering, 
route planning, environmental and engineering contractor engagement, 
environmental surveys/studies, and open houses.
    (8) Proposals for at least three prospective third-party 
contractors from which Commission staff may make a selection to assist 
in the preparation of the requisite NEPA document.
    (9) Acknowledgement that a complete Environmental Report and 
complete application are required at the time of filing; and
    (10) A description of a Public Participation Plan which identifies 
specific tools and actions to facilitate stakeholder communications and 
public information, including a project Web site and a single point of 
contact.
    (e) Director's notices.
    (1) When the Director finds that a prospective applicant has 
adequately addressed the requirements of paragraphs (a) through (d) of 
this section, the Director shall issue a notice of such finding. The 
pre-filing process shall be deemed to have commenced on the date of the 
Director's notice, and the date of such notice shall be used in 
determining whether the date an application is filed is at least 180 
days after commencement of the pre-filing process.
    (2) The Director shall issue a notice making a determination 
whether prospective modifications to an existing LNG terminal shall be 
subject to this section's pre-filing procedures and review process. If 
the Direct determines that the prospective modifications are 
significant modifications that involve state and local safety 
considerations, the Director's notice will state that the pre-filing 
procedures shall apply, and the pre-filing process shall be deemed to 
have commenced on the date of the Director's notice in determining 
whether the date an application is filed is at least 180 days after 
commencement of the pre-filing process.
    (f) Upon the Director's issuance of a notice commencing a 
prospective applicant's pre-filing process, the prospective applicant 
must:
    (1) Within seven days and after consultation with Commission staff, 
establish the dates and locations at which the prospective applicant 
will conduct open houses and meetings with stakeholders (including 
agencies) and Commission staff.
    (2) Within 14 days, conclude the contract with the selected third-
party contractor.
    (3) Within 14 days, contact all stakeholders not already informed 
about the project.
    (4) Within 30 days, submit a stakeholder mailing list to Commission 
staff.
    (5) Within 30 days, file a draft of Resource Report 1, in 
accordance with 18 CFR 380.12(c), and a summary of the alternatives 
considered or under consideration.
    (6) On a monthly basis, file status reports detailing the 
applicant's project activities including surveys, stakeholder 
communications, and agency meetings.
    (7) Be prepared to provide a description of the proposed project 
and to answer questions from the public at the scoping meetings held by 
OEP staff.
    (8) Be prepared to attend site visits and other stakeholder and 
agency meetings arranged by the Commission staff, as required.
    (9) Within 14 days of the end of the scoping comment period, 
respond to issues raised during scoping.
    (10) Within 60 days of the end of the scoping comment period, file 
draft Resource Reports 1 through 12.
    (11) At least 60 days prior to filing an application, file revised 
draft Resource Reports 1 through 12, if requested by Commission staff.
    (12) At least 90 days prior to filing an application, file draft 
Resource Report 13 (for LNG terminal facilities).
    (13) Certify that a Follow-on WSA will be submitted to the U. S. 
Coast Guard no later than the filing of an application with the 
Commission (for LNG terminal facilities).
    (g) Commission staff and third-party contractor involvement during 
the pre-

[[Page 52336]]

filing process will be designed to fit each project and will include 
some or all of the following:
    (1) Assisting the prospective applicant in developing initial 
information about the proposal and identifying affected parties 
(including landowners, agencies, and other interested parties).
    (2) Issuing an environmental scoping notice and conducting such 
scoping for the proposal.
    (3) Facilitating issue identification and resolution.
    (4) Conducting site visits, examining alternatives, meeting with 
agencies and stakeholders, and participating in the prospective 
applicant's public information meetings.
    (5) Reviewing draft Resource Reports.
    (6) Initiating the preparation of a preliminary Environmental 
Assessment or Draft Environmental Impact Statement, the preparation of 
which may involve cooperating agency review.
    (h) A prospective applicant using the pre-filing procedures of this 
section shall comply with the procedures in 18 CFR 388.112 for the 
submission of documents containing critical energy infrastructure 
information, as defined in 18 CFR 388.113.


Sec.  157.22  [Removed]

    8. Section 157.22 is removed.

PART 375--THE COMMISSION

    8a. The authority citation for part 375 continues to read as 
follows:

    Authority: 5 U.S.C. 551-557; 15 U.S.C. 717-717w, 3301-3432; 16 
U.S.C. 791-825r, 2601-2645; 42 U.S.C. 7101-7352.

    9. In Sec.  375.308, paragraph (z) is revised to read as follows:


Sec.  375.308  Delegations to the Director of the Office of Energy 
Projects.

* * * * *
    (z) Approve, on a case-specific basis, and make such decisions and 
issue guidance as may be necessary in connection with the use of the 
pre-filing procedures in 18 CFR 157.21, ``Pre-filing procedures and 
review process for LNG terminal facilities and other natural gas 
facilities prior to filing of applications.''

[FR Doc. 05-17480 Filed 9-1-05; 8:45 am]
BILLING CODE 6717-01-P