US DOE Moves To Streamline LNG Exports
The US Department of Energy (DOE) announced on 19 December that it now only requires US LNG exporters to report the country or countries of LNG deliveries, not country of end-use, to satisfy the DOE’s destination reporting requirement. It also announced additional efforts to streamline the reporting requirements for LNG export supply sales and contracts.
The policy change will address the reporting of LNG delivery destinations and the types of supply and sales agreements LNG exporters must file with DOE. Currently, DOE requires some LNG export authorization holders to report the final country of end-use for LNG exports, which can differ from the country receiving the initial physical delivery of LNG. Given the complexity of some LNG export transactions, and the challenges associated with tracking LNG exports all the way to their point of end-use, DOE is indicating via a new policy statement that reporting the country or countries of LNG deliveries (not country of end-use) will satisfy the destination reporting requirement. With this change in reporting requirements, LNG exporters are still required to continue the current ban on LNG exports to sanctioned countries.
Additionally, DOE is seeking to clarify via a proposed interpretative rule which types of supply and sales contract agreements need to be reported and when they must be filed. Per DOE’s current regulations, it is required of all long-term LNG export authorization holders to report all long-term, greater than 2 years, supply and sales contracts. This proposed interpretive rule is open for public comment for 30 days.
The US Energy Information Administration projects that US LNG export capacity will reach 8.9 Bcf/D by the end of next year, making it the third-largest exporter in the world behind Australia and Qatar. By 2021, baseload US LNG export capacity will exceed 9 Bcf/D.
Since exports of US LNG began from the lower 48 states in 2016, over 1.7 Tcf of US natural gas has been exported. To date, the DOE has approved 23.05 Bcf/D of long-term exports of natural gas to any country in the world not prohibited by US law or policy. There are currently three large-scale LNG export projects in operation, Sabine Pass, Dominion Cove Point, and Corpus Christi, which have a combined operating export capacity of approximately 4 Bcf/D. Three additional large-scale export are under construction. There are also a dozen large-scale export projects under review that would provide over 20 Bcf/D of additional export capacity, if approved and constructed.
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