[Federal Register Volume 77, Number 84 (Tuesday, May 1, 2012)]
[Notices]
[Pages 25711-25713]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-10444]


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DEPARTMENT OF ENERGY

[FE Docket No. 12-36-LNG]


Cheniere Marketing, LLC; Application for Blanket Authorization To 
Export Previously Imported Liquefied Natural Gas on a Short-Term Basis

AGENCY: Office of Fossil Energy, DOE.

ACTION: Notice of application.

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SUMMARY: The Office of Fossil Energy (FE) of the Department of Energy 
(DOE) gives notice of receipt of an application (Application), filed on 
March 30, 2012, 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 for a two-year period commencing on 
June 1, 2012. CMI seeks authorization to export LNG from the Sabine 
Pass LNG terminal, owned by 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. CMI is requesting this authorization both on its own behalf and 
as agent for other parties who hold title to the LNG at the time of 
export. The Application was filed under section 3 of the Natural Gas 
Act (NGA). 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 using procedures detailed in the Public Comment 
Procedures section no later than 4:30 p.m., eastern time, May 31, 2012.

ADDRESSES: Electronic Filing on the Federal eRulemaking Portal under FE 
Docket No. 12-36-LNG: http://www.regulations.gov.
    Electronic Filing by email: [email protected]

Regular Mail

    U.S. Department of Energy (FE-34), Office of Natural Gas Regulatory 
Activities, Office of Fossil Energy, P.O. Box 44375, Washington, DC 
20026-4375.

Hand Delivery or Private Delivery Services (e.g., FedEx, UPS, etc.)

    U.S. Department of Energy (FE-34), Office of Natural Gas Regulatory 
Activities, Office of Fossil Energy, Forrestal Building, Room 3E-042, 
1000 Independence Avenue SW., Washington, DC 20585.

FOR FURTHER INFORMATION CONTACT: Larine Moore or Lisa Tracy, U.S. 
Department of Energy (FE-34), Office of Natural Gas Regulatory 
Activities, Office of Fossil Energy, Forrestal Building, Room 3E-042, 
1000 Independence Avenue SW., Washington, DC 20585, (202) 586-9478; 
(202) 586-4523.
    Edward Myers, U.S. Department of Energy, Office of the Assistant 
General Counsel for Electricity and Fossil Energy, Forrestal Building, 
Room 6B-256, 1000 Independence Ave. SW., Washington, DC 20585, (202) 
586-3397.

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

[[Page 25712]]

Energy, Inc. (Cheniere Energy), which also is 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 1, 2010, DOE/FE issued Order No. 2795, which 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 500 Bcf of natural gas on a cumulative 
basis over a two-year period commencing on June 1, 2010.\1\ On December 
17, 2010, DOE/FE granted CMI blanket authorization to import LNG from 
various international sources for a two-year term beginning on January 
29, 2011.\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.
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    \1\ Cheniere Marketing, LLC, DOE/FE Order No. 2795 (June 1, 
2010) extends through May 31, 2012.
    \2\ Cheniere Marketing, LLC, DOE/FE Order No. 2891 (December 17, 
2010) extends through January 28, 2013.
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Current Application

    In the instant Application, CMI requests blanket authorization to 
export LNG previously imported into the United States from foreign 
sources from the Sabine Pass LNG terminal. CMI states that it plans to 
export LNG that had previously been 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 policy 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 proposes to export LNG 
that is derived from CMI's LNG importing activities and resides in LNG 
storage tanks at the Sabine Pass LNG terminal. CMI states that the LNG 
will either be re-exported or regasified for consumption in the 
domestic natural gas market contingent on U.S. and global market price 
signals. CMI states that no additional physical modifications to the 
Sabine Pass LNG terminal are required to accommodate the export 
authorization requested. CMI further states that there are no other 
proceedings related to this Application currently pending before DOE or 
any other federal agency. CMI is not seeking authorization to export 
domestically produced natural gas or LNG.

Public Interest Considerations

    In support of its Application, CMI states that pursuant to section 
3 of the NGA, DOE/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 a finding 
that the Application is in the public interest, which opponents bear 
the burden of overcoming.\4\ CMI states further, in evaluating an 
export application, FE applies the principles described in 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.
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    \3\ 15 U.S.C. 717b(a).
    \4\ See Panhandle Producers and Royalty Owners Association v. 
Era, 822 F.2d 1105, 1111 (DC Cir. 1987); Independent Petroleum 
Association v. ERA, 870 F .2d 168, 172 (5th Cir. 1989); Panhandle 
and Royalty Owners Association v. ERA, 847 F .2d 1168, 1176 (5th 
Cir. 1988).
    \5\ See 49 FR 6684, February 22, 1984.
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    CMI states that in DOE/FE Order No. 2795 issued on June 1, 2010, 
which granted CMI blanket authorization to export up to 500 Bcf 
(cumulative) of previously imported foreign-sourced LNG, FE determined 
that there was no domestic reliance on the volumes of imported LNG that 
CMI would seek to export.\6\ CMI also states that, in January 2012, FE 
made the same finding in granting Dominion Cove Point LNG, LP 
(Dominion) blanket authority to export from the Cove Point LNG Terminal 
facilities in Calvert County, Maryland up to 150 Bcf of previously 
imported LNG.\7\ In addition, CMI points out that similarly, on 
November 22, 2011, DOE/FE granted 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.\8\ CMI notes that in its order, DOE/FE stated that ``the 
record shows there is sufficient supply of natural gas to satisfy 
domestic demand from multiple sources at competitive prices without 
drawing on the LNG which ConocoPhillips seeks to export * * *'' \9\
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    \6\ Cheniere Marketing, LLC, DOE/FE Order No 2795 at 11.
    \7\ See Dominion Cove Point LNG, LP, DOE/FE Order No. 3055 
(January 9, 2012) at 11.
    \8\ ConocoPhillips Company, DOE/FE Order No. 3038 (November 22, 
2011).
    \9\ Id. at 6.
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    CMI states that in the above-referenced Dominion and ConocoPhillips 
orders, as well as in other blanket authorizations issued in recent 
years,\10\ DOE/FE has taken administrative notice that a review of the 
data and analysis prepared by the Energy Information Administration 
(EIA) shows that over the last several years, domestic natural gas 
production has increased significantly. CMI also cites more recent data 
from EIA's Annual Energy Outlook 2012 (Early Release) Reference case, 
which estimates that shale gas production will reach 8.1 trillion cubic 
feet in 2015.\11\ CMI asserts that DOE/FE's past findings with regard 
to similar applications in addition to EIA's most current gas 
production estimates support the conclusion that the foreign-sourced 
LNG CMI seeks to export is not needed to meet domestic demand.
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    \10\ See Freeport LNG Development, L.P., DOE/FE Order No. 2986 
(July 19, 2011); ENI USA Gas Marketing LLC, DOE/FE Order No. 2923 
(March 3, 2011); Sempra LNG Marketing, LLC, DOE/FE Order No. 2885 
(December 3, 2010); Dow Chemical Company, DOE/FE Order No. 2859 
(October 5, 2010).
    \11\ See Annual Energy Outlook 2012 Early Release Overview, 
http://www.eia.gov/forecasts/aeo/er/excel/overview.fig02.data.xls.
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    CMI is requesting authorization, for itself and as agent for third 
parties, to periodically export LNG imported under DOE/FE Order No. 
2891, 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 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 that the requested 
export authorization is consistent with the public interest.

Environmental Impact

    CMI states that no modifications to the Sabine Pass LNG terminal 
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 (NEPA).\12\ CMI further states 
that an

[[Page 25713]]

environmental impact statement or environmental assessment is not 
required.
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    \12\ 42 U.S.C. 4321 et seq.
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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. 00-002.00L (April 29, 2011) and DOE Redelegation Order No. 
00-002.04E (April 29, 2011). 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.
    NEPA 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, 
comments, or a motion to intervene or notice of intervention, as 
applicable. Any person wishing to become a party to the proceeding must 
file a motion to intervene or notice of intervention, as applicable. 
The filing of comments or a protest with respect to the Application 
will not serve to make the commenter or 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, comments, motions 
to intervene, or notices of intervention must meet the requirements 
specified by the regulations in 10 CFR part 590.
    Filings may be submitted using one of the following methods: (1) 
Submitting comments in electronic form on the Federal eRulemaking 
Portal at http://www.regulations.gov, by following the on-line 
instructions and submitting such comments under FE Docket No. 12-36-
LNG. DOE/FE suggests that electronic filers carefully review 
information provided in their submissions and include only information 
that is intended to be publicly disclosed; (2) emailing the filing to 
[email protected], with FE Docket No. 12-36-LNG in the title line; (3) 
mailing an original and three paper copies of the filing to the Office 
Natural Gas Regulatory Activities at the address listed in ADDRESSES; 
or (4) hand delivering an original and three paper copies of the filing 
to the Office of Natural Gas Regulatory Activities at the address 
listed in ADDRESSES.
    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 Natural Gas Regulatory Activities docket room, 
Room 3E-042, 1000 Independence Avenue SW., Washington, DC 20585. 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 and any filed 
protests, motions to intervene or notice of interventions, and comments 
will also be available electronically by going to the following DOE/FE 
Web address: http://www.fe.doe.gov/programs/gasregulation/index.html. 
In addition, any electronic comments filed will also be available at: 
http://www.regulations.gov.

    Issued in Washington, DC, on April 25, 2012.
John A. Anderson,
Manager, Natural Gas Regulatory Activities, Office of Oil and Gas 
Global Security and Supply, Office of Fossil Energy.
[FR Doc. 2012-10444 Filed 4-30-12; 8:45 am]
BILLING CODE 6450-01-P