[Federal Register Volume 77, Number 171 (Tuesday, September 4, 2012)]
[Notices]
[Pages 53874-53876]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-21690]


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DEPARTMENT OF ENERGY

[FE Docket No. 12-76-LNG]


The Dow Chemical Company; 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 
July 13, 2012, by The Dow Chemical Company (Dow), 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 390 billion cubic feet (Bcf) of natural gas on 
a short-term or spot market basis for a two-year period commencing on 
October 5, 2012.\1\ Dow seeks authorization to export this LNG from 
existing facilities on Quintana Island, Texas, 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. Dow 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.
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    \1\ The Dow Chemical Company, DOE/FE Order No. 2859 (October 5, 
2010) extends through October 4, 2012.

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, October 4, 
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2012.

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.

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 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

    Dow is a Delaware corporation with its principal place of business 
in Midland, Michigan. Dow is an international chemical and plastics 
manufacturing company with operations in a number of U.S. states. Dow 
owns and operates a large petrochemical manufacturing facility in 
Freeport, Texas, which is in close proximity to the LNG import/export 
terminal owned and operated by Freeport LNG Development, L.P. (FLNG) on 
Quintana Island, Texas. Dow contracted 0.5 Bcf per day of terminal 
capacity from FLNG for a twenty-year period beginning in July 2008. 
Dow's petrochemical facility in Freeport has the capability to receive 
regasified LNG from the FLNG terminal via several pipelines that extend 
directly to the facility.
    On April 20, 2012, FE granted Dow blanket authorization to import 
and export natural gas from and to Canada and Mexico and to import LNG 
from various international sources for a two-year term beginning on 
June 1, 2012.\2\ Under the terms of the blanket authorization, the LNG 
may be imported to any LNG receiving facility in the United States or 
its territories.
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    \2\ The Dow Chemical Company, DOE/FE Order No. 3083 (April 20, 
2012).
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Current Application

    In the instant Application, Dow requests blanket authorization to 
export previously imported LNG on a short-term or spot market basis in 
an amount up to the equivalent of 390 Bcf of natural gas. Dow further 
requests that such authorization extend to LNG supplies imported from 
foreign sources to which Dow holds title, as well as to LNG supplies 
imported from foreign sources that Dow may export on behalf of other 
entities who themselves hold title. .Dow requests authorization to 
export this LNG from the FLNG terminal 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 Dow states that it does not seek 
authorization to export domestically-produced natural gas.
    Dow states that its interest in renewing its blanket re-export 
authorization is driven by its desire to optimize the long-term LNG 
terminalling capacity for which it has contracted at the FLNG terminal 
and its need for flexibility to respond to periodic changes in domestic 
and world markets for natural gas and LNG. Dow desires the flexibility 
either to export the imported LNG to other world markets or to have LNG 
regasified for sale or use in domestic markets,

[[Page 53875]]

including at Dow's petrochemical facility in Freeport, a decision that 
would be based on prevailing market conditions.

Public Interest Considerations

    In support of its Application, Dow states that pursuant to section 
3 of the NGA, FE is required to authorize natural gas exports to a 
foreign country unless there is a finding that such exports ``will not 
be consistent with the public interest.'' \3\ Dow states that section 3 
thus creates a statutory presumption in favor of a properly framed 
export application.\4\ Dow states further that the public interest 
determination is guided by DOE Delegation Order No. 0204-111, which 
provides that the domestic need for natural gas is the principal factor 
to be considered when evaluating an export application.\5\
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    \3\ 15 U.S.C. 717b.(a). Natural gas is defined to include LNG in 
10 CFR Part 590.102(i).
    \4\ Phillips Alaska Natural Gas Corp. and Marathon Oil Co., DOE/
FE Order No. 1473 (2 FE ] 70,317) at 13 (April 2, 1999), citing 
Panhandle Producers and Royalty Owners Association v. ERA, 822 F.2d 
1105, 1111 (DC Cir. 1987).
    \5\ Id at 14.
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    As detailed in the Application, Dow states the blanket export 
authorization requested by Dow satisfies the public interest standard 
for the following reasons. Dow states that the LNG that may be exported 
pursuant to the blanket authorization requested in the Application is 
not needed to meet domestic demand. Dow states that DOE/FE has issued a 
number of blanket authorizations to export previously-imported LNG, 
including the one issued to Dow in Order No. 2859, finding that such 
LNG is not needed to meet domestic demand for natural gas. In addition, 
Dow states that on July 19, 2011, in Order No. 2986, which renewed 
FLNG's authorization to export previously imported LNG from its 
terminal facilities on Quintana Island, Texas, DOE/FE concluded that 
``the evidence of record indicates that Untied States consumers 
continue to have access to substantial quantities of natural gas 
sufficient to meet domestic demand from multiple other sources at 
competitive prices without drawing on the LNG which Freeport LNG seeks 
to export.''
    Dow further states that granting the requested export authorization 
will facilitate the importation of LNG into the United States. Further 
details can be found in the Application.

Environmental Impact

    Dow asserts that its requested export authorization does not raise 
any environmental concerns. Dow states that no new facilities or 
modifications to any existing facilities at FLNG's Quintana Island 
terminal would be required in order for Dow to export LNG from the 
terminal. Dow further states that the environmental impacts of 
permitting the exportation of LNG from FLNG's Quintana Island terminal 
were already reviewed by DOE/FE in Order No. 2644 \6\ as well as the 
granting of authority to others exporting previously imported LNG from 
the FLNG terminal. Dow asserts that consequently, the same conclusion 
is applicable to this Application insofar as the blanket authorization 
requested by Dow is substantially identical to its current blanket 
authorization.
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    \6\ Freeport LNG Development, L.P., Order No. 2644, June 8, 2009 
at p. 12.
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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.
    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, 
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) 
Emailing the filing to [email protected], with FE Docket No. 12-76-LNG 
in the title line; (2) mailing an original and three paper copies of 
the filing to the Office of Oil and Gas Global Security and Supply at 
the address listed in ADDRESSES; or (3) hand delivering an original and 
three paper copies of the filing to the Office of Oil and Gas Global 
Security and Supply 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 Dow is available for inspection and 
copying in the Office of Natural Gas Regulatory Activities docket room, 
3E-042, 1000 Independence Avenue SW., Washington, DC 20585. The docket 
room is open between the hours of 8:00 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:

[[Page 53876]]

http://www.fe.doe.gov/programs/gasregulation/index.html.

    Issued in Washington, DC, on August 29, 2012.
John A. Anderson,
Manager, Natural Gas Regulatory Activities, Office of Oil and Gas 
Global Security and Supply, Office of Fossil Energy.
[FR Doc. 2012-21690 Filed 8-31-12; 8:45 am]
BILLING CODE 6450-01-P