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U.S. LNG Export Projects at Risk Due to Stricter Emission Standards

U.S. LNG Export Projects at Risk Due to Stricter Emission Standards

May 20, 2024

U.S. LNG Export Projects at Risk Due to Stricter Emission Standards

Several LNG facilities are facing stricter environmental scrutiny, which could affect the timeline and operation for new U.S. liquefied natural gas (LNG) export projects.

The shift in policy came after President Joe Biden paused new LNG project approvals in January to reassess the permitting process. The U.S. Administration is now considering implementing tighter regulations on pollution levels that the export facilities may emit into surrounding communities.

Among the affected projects is Venture Global’s CP2 LNG located in Louisiana. The Federal Energy Regulatory Commission (FERC) recently requested additional information from Venture Global to demonstrate that the project's emissions would adhere to the new, more stringent standards.

Venture Global has criticized the FERC’s request, referring to it as an "eleventh hour data request" that could lead to "further baseless claims," according to a letter from the company to the regulator obtained by the Financial Times. The company contends that its project complies with current standards and has submitted the requested information to FERC.

Similarly, Cheniere Energy, the leading U.S. LNG exporter, is working through the approval process for additional production units, known as trains 8 and 9, at its Corpus Christi facility. CEO Jack Fusco indicated on the Q1 earnings call that the company anticipates receiving its environmental assessment soon and is confident in securing all necessary regulatory approvals to sanction the project by 2025.

Charlie Riedl, Executive Director at the Center for LNG (CLNG), regards the pause in permits as a "short-sighted and damaging action" that may hinder U.S. economic interests and international energy market stability.

The Administration's review process and potential new requirements could significantly impact both the domestic energy industry and international energy relations. The industry is closely monitoring the developments, awaiting the Administration's final decisions on these critical energy infrastructure projects.

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