[Federal Register Volume 79, Number 214 (Wednesday, November 5, 2014)]
[Rules and Regulations]
[Pages 65541-65542]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-25143]


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DEPARTMENT OF ENERGY

10 CFR Part 590


Procedures for Changes in Control Affecting Applications and 
Authorizations To Import or Export Natural Gas

AGENCY: Office of Fossil Energy, Department of Energy.

ACTION: Notice of procedures.

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SUMMARY: The U.S. Department of Energy's (DOE or the Department) 
regulations require applications to export natural gas from the United 
States to identify ``all the participants in the transaction, including 
the parent company, if any, and identification of any corporate or 
other affiliations among the participants.'' In many cases, either 
before or after a final export authorization has been issued, ownership 
or management of the exporting entity changes hands, resulting in a 
change in control (CIC). This document sets forth procedures that will 
apply when applicants to import or export natural gas or those entities 
that have already received an import or export authorization undergo 
changes in control.

DATES: Effective November 5, 2014, and applicable beginning September 
26, 2014.

FOR FURTHER INFORMATION CONTACT: 
Benjamin Nussdorf, U.S. Department of Energy (FE-34), Office of Oil and 
Gas Global Security and Supply, Office of Fossil Energy, Forrestal 
Building, Room 3E-052, 1000 Independence Avenue SW., Washington, DC 
20585, (202) 586-7893.
Samuel Walsh, U.S. Department of Energy (GC-1), Office of the General 
Counsel, Forrestal Building, 1000 Independence Avenue SW., Washington, 
DC 20585, (202) 586-6732.

SUPPLEMENTARY INFORMATION:

I. Background

    Pursuant to section 3(a) of the Natural Gas Act (NGA), 15 U.S.C. 
717b(a), no person may import or export natural gas without 
authorization from DOE, and DOE will approve such imports or exports 
unless, after opportunity for a hearing, it determines that imports or 
exports are not consistent with the public interest. Section 3(c) of 
the NGA

[[Page 65542]]

provides that exports of natural gas to countries with which the United 
States has entered into a free trade agreement (FTA) providing for 
national treatment for trade in natural gas (FTA countries),\1\ and all 
imports of liquefied natural gas (LNG) from any country, are deemed in 
the public interest and must be granted without modification or delay. 
15 U.S.C. 717b(c).
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    \1\ ``Non-FTA countries'' refers to those nations with which the 
United States has not entered into a FTA providing for national 
treatment for trade in natural gas, and with which trade is not 
prohibited by U.S. law or policy. DOE reviews applications for 
exports of natural gas to non-FTA countries under NGA section 3(a).
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    DOE's regulations at 10 CFR 590.204(b) require applicants to amend 
pending applications whenever there are changes in material facts or 
conditions upon which the proposal is based. Additionally, DOE's 
regulations at 10 CFR 590.405 state that authorizations to import or 
export natural gas shall not be transferable or assignable unless 
specifically authorized by the Assistant Secretary for Fossil Energy. 
In applying Sec.  590.405, DOE has made clear that a change in control 
of the authorization holder may occur through asset sale or stock 
transfer or by other means. DOE has also explained that it construes a 
change in control to mean a change, directly or indirectly, of the 
power to direct the management or policies of an entity whether such 
power is exercised through one or more intermediary companies or 
pursuant to an agreement, written or oral, and whether such power is 
established through ownership or voting of securities, or common 
directors, officers, or stockholders, or voting trusts, holding trusts, 
or debt holdings, or contract, or any other direct or indirect means. 
DOE has explained that a rebuttable presumption that control exists 
will arise from the ownership or the power to vote, directly or 
indirectly, 10 percent or more of the voting securities of such entity.

II. Discussion

    This document announces new procedures to amend both applications 
pending before DOE and authorizations already issued by DOE to reflect 
changes in control of the proposed or actual importing or exporting 
entity (or entities). These procedures are intended to streamline the 
process for making these changes without affecting DOE's ability to 
make the public interest determination required by Section 3(a) of the 
NGA. These procedures do not affect the existing standard used by DOE 
to determine if a change in control has occurred or will occur.

a. Timing

    Entities may file notice of changes in control before such changes 
have been effectuated but, in all cases, must file notice of changes in 
control no later than 30 days after such changes have been effectuated 
or 30 days after publication of this document, whichever is later, 
unless good cause is shown for a later filing.

b. Non-FTA Natural Gas Export Applications and Authorizations

    With respect to pending non-FTA export applications, i.e., 
proceedings in which DOE has not yet issued a final order, applicants 
may amend their applications to reflect a change in control by 
submitting notice of such amendment to DOE and serving that notice on 
other parties in the proceeding, as provided in 10 CFR 590.107. DOE 
will give immediate effect to the amendment but will accept and 
consider answers to the notice of amendment received within 15 days of 
service of the applicant's pleading. See 10 CFR 590.302(b). DOE then 
will address the issues raised in any answers to such an amendment in 
its final order on the pending application. Unless the opponents of the 
change in control demonstrate that the change renders the underlying 
application inconsistent with the public interest, or unless DOE 
independently makes such a determination, no further action will be 
taken by DOE on the change in control and the amendment will continue 
to be given effect.
    With respect to final non-FTA export authorizations already issued 
by DOE, authorization holders may submit a statement of change in 
control to DOE using one of the following methods: (1) Emailing the 
filing to [email protected] with CIC and the FE Docket No. in the title 
line; (2) mailing an original and three paper copies of the filing to 
U.S. Department of Energy (FE-34), Office of Oil and Gas Global 
Security and Supply, P.O. Box 44375, Washington, DC 20026-4375; or (3) 
hand delivering an original and three paper copies of the filing to 
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.
    Upon receipt of such a statement of change in control, DOE will 
give effect to the change in control and will publish a notice of the 
change in the Federal Register. Interested persons will be provided 15 
days from the date of publication in the Federal Register in order to 
move to intervene, protest, and answer the statement of change in 
control. If no interested person protests the change in control and DOE 
takes no action on its own motion, the amendment will be deemed granted 
30 days after publication in the Federal Register. If one or more 
protests are submitted, DOE will review any motions to intervene, 
protests, and answers, and will issue a determination as to whether the 
proposed change in control has been demonstrated to render the 
underlying authorization inconsistent with the public interest.

c. FTA Long-Term Natural Gas Applications and Authorizations and Non-
FTA Long-Term LNG Import Applications and Authorizations

    With respect to pending FTA long-term natural gas import or export 
applications and pending non-FTA long-term LNG import applications, 
applicants may amend their applications to reflect a change in control 
by submitting a notice of such amendment to DOE. DOE will give 
immediate effect to the amendment and take no further action.
    With respect to FTA long-term natural gas import or export 
authorizations and non-FTA long-term LNG import authorizations already 
issued by DOE, authorization holders may submit a statement of change 
in control to DOE using one of the three methods set forth above. Upon 
receipt of the statement, DOE will give immediate effect to the change 
in control and take no further action.
    Long-term FTA applicants or authorization holders simultaneously 
seeking to amend their non-FTA applications or authorizations may 
provide notice to DOE of the change in control in a single notice or 
statement, respectively, so long as the desired change to the long-term 
FTA application or authorization is described clearly with reference to 
the applicable orders or docket numbers.
    This document is applicable beginning September 26, 2014.

    Issued in Washington, DC, on October 16, 2014.
John A. Anderson,
Director, Division of Natural Gas Regulatory Activities, Office of Oil 
and Gas Global Security and Supply, Office of Oil and Natural Gas.
[FR Doc. 2014-25143 Filed 11-4-14; 8:45 am]
BILLING CODE 6450-01-P