Photo Credit: Freeport LNG

The US Department of Energy today granted Freeport LNG two final authorizations to export natural gas to non-Free Trade Agreement countries. The ruling authorizes Freeport to export up to 1.8 billion cubic feet of LNG per day for 20 years.

The DOE earlier this year changed its LNG permit approval process from a blanket first in – first out approach to one that prioritizes applications submitted for projects that have already completed environmental review required under the National Environmental Policy Act. The logic behind the change is that NEPA reviews of large industrial projects like liquefaction plants typically run into the millions of dollars, so projects that have invested in completing those environmental assessments are considered to be closer to taking a final investment decision than projects that have not completed the NEPA review process.

“The Energy Department conducted an extensive, careful review of the Freeport LNG applications.  Among other factors, the Department considered the economic, energy security, and environmental impacts and determined that exports at a rate of up to 1.4 Bcf/d and 0.4 Bcf/d for a period of 20 years was not inconsistent with the public interest.”

Freeport LNG is owned by ConocoPhillips and Michael Smith and the liquefaction project has offtake agreements with SK E&S, BP, Osaka Gas and Chubu Electric. The plant is expected to cost $14 billion.