Sabine Pass Liquefaction, LLC; Application for Long-Term Authorization To Export Liquefied Natural Gas, 62512-62514 [2010-25546]

Agencies

• DEPARTMENT OF ENERGY

[Federal Register Volume 75, Number 196 (Tuesday, October 12, 2010)]
[Notices]
[Pages 62512-62514]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-25546]


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DEPARTMENT OF ENERGY

[FE Docket No. 10-111-LNG]


Sabine Pass Liquefaction, LLC; Application for Long-Term 
Authorization To Export Liquefied Natural Gas

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 
September 7, 2010, by Sabine Pass Liquefaction, LLC (Sabine Pass), 
requesting long-term, multi-contract authorization to export up to 16 
million metric tons per annum (mtpa) of domestic natural gas as 
liquefied natural gas (LNG) for a 20-year period, commencing the 
earlier of the date of first export or five years from the date of 
issuance of the requested authorization. Sabine Pass seeks 
authorization to export LNG from the Sabine Pass LNG Terminal \1\ to 
any country with which the United States does not have a free trade 
agreement (FTA) requiring the national treatment for trade in natural 
gas and LNG that has, or in the future develops, the capacity to import 
LNG and with which trade is not prohibited by U.S. law or policy. The 
application was filed under section 3 of the Natural Gas Act (NGA), as 
amended by section 201 of the Energy Policy Act of 1992. Protests, 
motions to intervene, notices of intervention, and written comments are 
invited.
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    \1\ The Sabine Pass LNG Terminal is an existing LNG import 
facility located in Cameron Parish, Louisiana that is owned by 
Sabine Pass's affiliate, Sabine Pass LNG, L.P. (Sabine Pass LNG).

DATES: Protests, motions to intervene or notices of intervention, as 
applicable, requests for additional procedures, and written comments 
are to be filed at the address listed below in ADDRESSES no later than 
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4:30 p.m., eastern time, December 13, 2010.

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 Lisa Tracy, 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

    Sabine Pass, an indirect subsidiary of Cheniere Energy, Inc. 
(Cheniere Energy), has its principal place of business in Houston, 
Texas. Cheniere Energy is a Delaware corporation with its primary place 
of business in Houston, Texas. Cheniere Energy is a developer of LNG 
terminals and natural gas pipelines on the Gulf Coast, including the 
Sabine Pass LNG Terminal. Sabine Pass is authorized to do business in 
the States of Texas and Louisiana. This Application is the second part 
of a two-phased authorization sought by Sabine Pass in conjunction with 
the development of the Sabine Pass Liquefaction Project (Liquefaction 
Project). The Liquefaction Project (Liquefaction Project) is being 
developed to liquefy domestic supplies of natural gas delivered to the 
Sabine Pass LNG Terminal for export to foreign markets. The 
Liquefaction Project would turn the Sabine Pass LNG Terminal into a bi-
directional LNG facility, capable of liquefying and exporting natural 
gas along with importing and re-gasifying foreign-sourced LNG, 
simultaneously.

Existing Long-Term, Multi-Contract Authorization

    On September 7, 2010, in DOE/FE Order No. 2833, FE granted Sabine 
Pass authorization to export up to 16 million mtpa of domestically 
produced LNG (approximately 803 Bcf per year) from the Sabine Pass LNG 
Terminal for a 30-year term, beginning on the earlier date of first 
export, or September 7, 2020, pursuant to one or more long-term export 
contracts (greater than two years) with third parties with terms up to 
30 years executed by September 7, 2020. The LNG may be exported to 
Australia, Bahrain, Singapore, Dominican Republic, El Salvador, 
Guatemala, Honduras, Nicaragua, Chile, Morocco, Canada, Mexico, Oman, 
Peru, Singapore, and Jordan, and to any nation which DOE subsequently 
identifies publicly as having entered into a FTA providing for national 
treatment for trade in natural gas (FTA Countries), provided that the 
destination nation has the capacity to import LNG.

Current Application

    In the instant application, Sabine Pass seeks long-term, multi-
contract authorization to export up to 16 million mtpa of LNG for a 20-
year period, commencing the earlier of the date of first export or five 
years from the date of issuance of the requested authorization. Sabine 
Pass seeks authorization to export LNG from the Sabine Pass LNG 
Terminal to any country with which the United States does not have a 
FTA requiring the national treatment of trade in natural gas and LNG 
that has, or in the future develops, the capacity to import LNG and 
with which trade is not prohibited by U.S. law or policy.
    Sabine Pass seeks long-term, multi-contract approval to export LNG 
to applicable countries not otherwise authorized pursuant to DOE/FE 
Order No. 2833. Sabine Pass categorizes those countries, for purpose of 
this Application, as countries that hold membership in the World Trade 
Organization (WTO Countries) and those countries that do not hold 
membership in the WTO (non-WTO Countries). Sabine Pass requests that FE 
review its request for authorization to export LNG to WTO Countries 
under the standard of review set forth in section 3(c) of the NGA, 15 
U.S.C. 717b(c). Sabine Pass acknowledges that its request for 
authorization to export LNG to non-WTO Countries must be reviewed 
pursuant to the public interest

[[Page 62513]]

standard articulated in Section 3(a) of the NGA.\2\
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    \2\ 15 U.S.C. 717b(a).
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    Sabine Pass requests authorization to export LNG acting on its own 
behalf or as agent for others. Citing the nature and complexity of 
current market practices Sabine Pass seeks a waiver of certain elements 
of Section 590.202(b) of the DOE regulations \3\ that require the 
Application to include information concerning the source and security 
of the natural gas supply to be exported and other transaction-specific 
information.
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    \3\ 10 CFR 590.202(b).
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    Sabine Pass requests that, pursuant to Section 590.402 of the DOE 
regulations,\4\ the Assistant Secretary issue a conditional Order 
authorizing the export of domestically produced LNG conditioned on the 
completion of the environmental review of the Liquefaction Project by 
the Federal Energy Regulatory Commission (FERC).
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    \4\ 10 CFR 590.402.
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Public Interest Considerations

    Sabine Pass states that insofar as the application seeks 
authorization to export to non-WTO Countries, FE's public interest 
determination should be guided by DOE's Delegation Order No. 0204-111 
which designates ``domestic need for the natural gas proposed to be 
exported as the only explicit criterion that must be considered in 
determining the public interest.'' Sabine Pass further states that 
insofar as the application seeks authorization to export to WTO 
Countries, DOE should deem the application to be in the public interest 
and grant the application without modification or delay.
    Sabine Pass states that the Liquefaction Project was proposed in 
response to the improved outlook for domestic natural gas production, 
in particular to shale gas-bearing formations in the United States. 
Sabine Pass maintains that improvements in drilling and extraction 
technologies coupled with the widespread use of best practices in 
unconventional drilling and resource development have lessened some of 
the uncertainties associated with future domestic natural gas 
production.
    Sabine Pass states that in support of its Application, it 
commissioned several reports to assess domestic need for the natural 
gas to be exported from the Liquefaction Project. Sabine Pass states 
that these reports, as well as other publicly available information, 
indicate the United States has significant natural gas resources 
available at modest prices to meet projected domestic demand and 16 
mtpa of exports over the 20-year period as requested in its 
Application.
    Finally, Sabine Pass states that the export of domestically 
produced LNG will provide the following benefits, which are consistent 
with the public interest:
    First, Sabine Pass contends that the project will stimulate the 
local, regional, and national economies through job creation, increased 
economic activity and tax revenues.
    Second, Sabine Pass maintains that the Sabine Pass LNG Liquefaction 
Project will play an influential role in contributing to the growth of 
natural gas production in the United States and a reduced reliance on 
foreign sources of oil.
    Third, Sabine Pass contends that the export of LNG will further the 
President's National Export Initiative by improving the balance of 
payments with the rest of the world, thereby reducing the overall U.S. 
trade deficit.
    Fourth, Sabine Pass maintains that the export of LNG will raise 
domestic natural gas productive capacity and promote stability in 
domestic natural gas pricing.
    Fifth, Sabine Pass contends that the export of domestically 
produced LNG will promote liberalization of the global gas market by 
fostering increased liquidity and trade at prices established by market 
forces.
    Sixth, Sabine Pass maintains that the export of LNG will advance 
national security and the security of U.S. allies through 
diversification of global natural gas supplies.
    Seventh, Sabine Pass contends that the export of LNG will advance 
initiatives underway by the current Administration to promote 
investment in energy infrastructure and to increase trade with 
neighboring Caribbean and Central/South America nations.
    A more complete discussion of these issues can be found in the 
Application.

Environmental Impact

    Sabine Pass states that the Liquefaction Project will have minimal 
environmental impacts given that all facilities will be located within 
the previously authorized footprint of the existing Sabine Pass LNG 
Terminal. Sabine Pass states that the FERC conducted an environmental 
review of the Sabine Pass LNG Terminal site in connection with 
authorization of the siting, construction and operation of the Terminal 
in Docket No. CP04-47-000 and Docket No. CP05-396-000. Sabine Pass 
states that any additional environmental impacts associated with the 
construction and operation of the Liquefaction Project will be reviewed 
by the FERC under the National Energy Policy Act (NEPA), 42 U.S.C. 4321 
et seq., and by all applicable state and federal permitting agencies 
(e.g., United States Army Corps of Engineers and Louisiana Department 
of Natural Resources, among others) as part of the permitting process 
for the Liquefaction Project.

Related Authorizations

    Sabine Pass and Sabine Pass LNG currently are undergoing the FERC's 
NEPA pre-filing review for the Liquefaction Project in Docket No. PF10-
24-000. Sabine Pass and Sabine Pass LNG anticipate filing a formal 
application with FERC no later than February 2011 and will request that 
FERC issue authorization of the siting, construction and operation of 
the Liquefaction Project by December 2011.

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. 00-002.00I (Nov. 10, 2009) and DOE Redelegation Order No. 00-
002.04D (Nov. 6, 2007). In reviewing this LNG export application, DOE 
will consider any issues required by law or policy. To the extent 
determined to be necessary or appropriate, these issues will include 
domestic need for the gas, the impact on U.S. gross domestic product, 
consumers, industry, U.S. balance of trade, jobs creation, and other 
issues, as well as 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, as well as any other issues deemed relevant 
to the application.
    NEPA 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.
    Due to the complexity and novelty of the issues raised by the 
Applicants, interested persons will be provided 60 days from the date 
of publication of this Notice in which to submit comments, protests, 
motions to intervene, notices of intervention, or motions for 
additional procedures.

Public Comment Procedures

    You may submit comments in electronic form on the Federal 
eRulemaking Portal at https://www.regulations.gov. Alternatively, 
written comments can be submitted

[[Page 62514]]

using the procedures discussed below. If using electronic filing, 
follow the on-line instructions and submit such comments under FE 
Docket No. 10-111-LNG. DOE/FE suggests that electronic filers carefully 
review information provided in their submissions, and include only 
information that is intended to be publicly disclosed. You may not 
electronically file a protest, motion to intervene, or notice of 
intervention, but may submit such pleadings using the following 
process.
    In response to this notice, any person may file a protest, motion 
to intervene or notice of intervention or written comments, as provided 
in DOE's regulations at 10 CFR part 590.
    Any person wishing to become a party to the proceeding and to have 
their written comments considered as a basis for any decision on the 
application 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 may be considered in determining the appropriate 
action to be taken on the application. All protests, motions to 
intervene, notices of intervention, and written comments must meet the 
requirements specified by the regulations in 10 CFR part 590. Except 
where comments are filed electronically, as described above, comments, 
protests, motions to intervene, notices of intervention, and requests 
for additional procedures shall be filed with the Office of Oil and Gas 
Global Security and Supply at the address listed above.
    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 Sabine Pass is available for inspection 
and copying in the Office of Oil and Gas Global Security and Supply 
docket room, 3E-042, at the above address. The docket room is open 
between the hours of 8 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: https://www.fe.doe.gov/programs/gasregulation/. In 
addition, any electronic comments filed will also be available at: 
https://www.regulations.gov.

    Issued in Washington, DC, on October 5, 2010.
John A. Anderson,
Manager, Natural Gas Regulatory Activities, Office of Oil and Gas 
Global Security and Supply, Office of Fossil Energy.
[FR Doc. 2010-25546 Filed 10-8-10; 8:45 am]
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