Barca LNG LLC; Application for Long-Term Authorization To Export Liquefied Natural Gas Produced From Domestic Natural Gas Resources to Non-Free Trade Agreement Countries for a 25-Year Period, 75339-75341 [2013-29541]

Agencies

• DEPARTMENT OF ENERGY

[Federal Register Volume 78, Number 238 (Wednesday, December 11, 2013)]
[Notices]
[Pages 75339-75341]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-29541]


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DEPARTMENT OF ENERGY

[FE Docket No. 13-118-LNG]


Barca LNG LLC; Application for Long-Term Authorization To Export 
Liquefied Natural Gas Produced From Domestic Natural Gas Resources to 
Non-Free Trade Agreement Countries for a 25-Year Period

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 
August 23, 2013, by Barca LNG LLC (Barca), requesting long-term, multi-
contract authorization to export LNG produced from domestic sources in 
a volume equivalent to approximately 584 billion cubic feet per year 
(Bcf/yr) of natural gas, or 1.6 Bcf per day (Bcf/d). Barca seeks 
authorization to export the LNG for a 25-year term from the proposed 
Barca LNG Terminal (Project), to be located at the Port of Brownsville 
in Brownsville, Texas. Barca requests authorization to export LNG to 
any country with which the United States does not have a free trade 
agreement (FTA) requiring national treatment for trade in natural gas 
(non-FTA countries) with which trade is not prohibited by U.S. law or 
policy. Barca requests that this authorization commence on the earlier 
of the date of first export or 8 years from the date the authorization 
is granted. Barca requests this authorization both on its behalf and as 
agent for other parties who hold title to the LNG at the time of 
export. The Application was filed under section 3 of the Natural Gas 
Act (NGA), 15 U.S.C. 717b.

DATES: Protests, motions to intervene or notices of intervention, as 
applicable, requests for additional procedures, and written comments 
are to be filed using procedures detailed in the Public Comment 
Procedures section no later than 4:30 p.m., eastern time, February 10, 
2014.

ADDRESSES: Electronic Filing by email: fergas@hq.doe.gov.

Regular Mail

U.S. Department of Energy (FE-34), Office of Natural Gas Regulatory 
Activities, Office of Fossil Energy, P.O. Box 44375, Washington, DC 
20026-4375.

Hand Delivery or Private Delivery Services (e.g., FedEx, UPS, etc.)

U.S. Department of Energy (FE-34), Office of Natural Gas Regulatory 
Activities, Office of Fossil Energy, Forrestal Building, Room 3E-042, 
1000 Independence Avenue SW., Washington, DC 20585.

FOR FURTHER INFORMATION CONTACT:
Larine Moore or Marc Talbert, U.S. Department of Energy (FE-34), Office 
of Natural Gas Regulatory Activities, Office of Fossil Energy, 
Forrestal Building, Room 3E-042, 1000 Independence Avenue SW., 
Washington, DC 20585, (202) 586-9478; (202) 586-7991.
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 Avenue SW., Washington, DC 20585, (202) 
586-3397.

SUPPLEMENTARY INFORMATION:

Background

    Barca is a Delaware limited liability company with its principal 
place of business in Boston, Massachusetts. Barca states that it 
expects to qualify as a Service-Disabled Veteran Owned Business, as 
discussed below. Barca's principal executives are Brendan Kelley, Mason 
Bridges, and Andrew Kunian.

[[Page 75340]]

    Barca proposes to develop, own, and operate a natural gas 
liquefaction facility and LNG export terminal at the Port of 
Brownsville in Brownsville, Texas. The Application includes a copy of a 
signed option agreement between Barca and the Brownsville Navigation 
District for the lease by Barca of a 15 acre tract of land. Barca 
states that the site will be based on a floating liquefaction unit on a 
barge (FLNG) and an existing LNG tanker (utilized solely for storage) 
that are anchored to a dock at the Port of Brownsville. Barca states 
that LNG tankers owned by third parties will be loaded via ship to ship 
transfer from Barca's LNG storage tanker, then will set sail to buyers 
in Europe and Asia. Barca states that the FLNG is an autonomous 
floating structure that does not rely on shore-based utilities to 
function. Barca states that the FLNG will be constructed in a shipyard 
and towed to its designated site, where it will be integrated with the 
gas source. Barca states that mooring and connection infrastructure 
requirements associated with the FLNG are minimal.

Current Application

    Barca requests that DOE/FE grant a long term (in excess of two 
years), multi-contract authorization to export LNG from export 
terminals to be constructed in Brownsville, Texas to any non-FTA 
country which has developed or in the future develops the capacity to 
import LNG, and with which trade is not prohibited by U.S. law or 
policy. Barca requests this authorization for a volume of LNG 
equivalent to approximately 1.6 Bcf/d of natural gas (584 Bcf/yr) for a 
25-year term, up to 14.6 trillion cubic feet, beginning on the date of 
the first export or 8 years from the date of issuance of the 
authorization requested by this Application, whichever is sooner.
    Barca states that rather than enter into Liquefaction Tolling 
Agreements (LTAs), its planned business model is to buy natural gas at 
the domestic price of the Henry Hub futures contract and sell it 
internationally at the prevailing market rate. However, if the 
profitability of this model declines, Barca states that it will 
maintain the option to convert to an LTA model, under which individual 
customers who hold title to the domestic natural gas will have the 
right to deliver that gas to Barca's terminal at the Project and 
receive LNG in return.
    Barca requests long term, multi-contract authorization to engage in 
exports of LNG on its own behalf or as agent for others. Barca 
contemplates that the title holder at the point of export may be Barca 
or one of Barca's customers, or another party that has purchased LNG 
from an LTA customer pursuant to a long term contract. Barca requests 
authorization to register each LNG title holder for whom Barca seeks to 
export as agent, and proposes that this registration include a written 
statement by the title holder acknowledging and agreeing to comply with 
all applicable requirements included by DOE/FE in Barca's export 
authorization, and to include those requirements in any subsequent 
purchase or sale agreement entered into by that title holder. In 
addition to its registration of any LNG title holder for whom Barca 
seeks to export as agent, Barca states that it will file under seal 
with DOE/FE any relevant long term commercial agreements between Barca 
and such LNG title holder, including LTAs, once the agreements have 
been executed. Barca states that DOE/FE has previously found that this 
commitment conforms to the requirements of 10 CFR 590.202(b), which 
calls upon applicants to supply transaction information ``to the extent 
practicable.''
    Barca states that the natural gas supply underlying the proposed 
exports will come from the interconnected and highly liquid domestic 
market for natural gas. Barca states that while some of the proposed 
export supply may be secured through long term contracts, large volumes 
are likely to be acquired on the spot market. Barca states that the 
biggest market hub in North America, the Henry Hub, is located in 
southern Louisiana, and the Houston Ship Channel and Katy Hub provide 
flexibility to natural gas shippers in Texas. Barca states that it will 
be able to source natural gas from these locations. Barca states that, 
alternatively, it will be able to contract directly with exploration 
and production companies such as Chesapeake Energy, Anadarko, Devon 
Energy, Encana, Southwest Energy, EOG Resources, and EQT Resources. 
Barca anticipates that several natural gas basins will supply the 
Project, including the Permian, Eagle Ford, Barnett, Woodford, and 
Haynesville-Bossier basins. Barca states that these basins are served 
by several pipelines that can transfer natural gas to the Project.
    Barca states that pursuant to the National Environmental Policy Act 
(NEPA), the Federal Energy Regulatory Commission (FERC) will be the 
lead agency for environmental review. Barca requests conditional 
authorization to export LNG from the Project, pending FERC 
authorization to site, construct and operate it. Barca states that such 
conditional authorizations are routinely issued by the DOE/FE, which 
may review an application to determine whether a proposed authorization 
is in the public interest concurrent with FERC's environmental impact 
review. Barca states that it requests that DOE/FE authorize the 
requested export of LNG produced from domestically sourced natural gas 
conditioned upon FERC's authorization of the Project pursuant to NEPA.

Public Interest Considerations

    Barca states that as a result of technological advances, huge 
reserves of domestic shale gas that were previously uneconomic to 
develop are now producing natural gas in many regions of the United 
States. Barca states that the United States is now estimated to have 
more natural gas resources than it can use in a century. Barca states 
that large volumes of domestic shale gas reserves and continued low 
production costs will enable the United States to export LNG while also 
meeting domestic demand for natural gas for decades.
    Barca states that as U.S. natural gas reserves and production have 
risen, U.S. natural gas prices have fallen to the point where they are 
the lowest in the world. Barca states that LNG prices in Asia are 
indexed to crude oil prices and are generally higher than elsewhere in 
the world. Barca states that the lack of international natural gas 
pipelines in Asia means that, from a practical standpoint, the 
industrialized countries, including Japan, Korea, and Taiwan, are 
dependent upon LNG imports for their natural gas supplies. Barca states 
that while Europe receives pipeline gas from various sources, the long 
supply chains and inflexibility of European markets have made 
diversification of supply a high priority. Barca states that 
competitively priced LNG supplies from the United States will play a 
significant role in this diversification. Barca states that domestic 
natural gas prices in the United States are projected to remain low 
relative to European and Asian markets far into the future, making 
exports of LNG by vessel a viable long term opportunity for the United 
States.
    Barca states that a grant of the Application will serve the public 
interest in several respects. These include: (1) Support to United 
States energy security; (2) significant environmental benefits due to 
substitution of cleaner burning natural gas for coal or oil; (3) direct 
and indirect job creation; (4) significant economic stimulus, including 
growing the tax base and increasing overall economic activity; and (5) 
material improvement in the United States's balance of trade. Barca 
states that these benefits will be obtained with only a minimal effect 
on

[[Page 75341]]

domestic natural gas prices. Barca states that at current and 
forecasted rates of demand, U.S. natural gas reserves will meet demand 
for 100 years. Barca states that the requested export authorization 
will allow the United States to benefit now from natural gas resources 
that may not otherwise be produced for many decades.
    Barca states that, on or around December 1, 2013, one of its 
principal executives (Mason Bridges) will be classified as a service-
disabled veteran by the U.S. Department of Veterans Affairs and that 
another principal, Brendan Kelly, is already so classified. 
Accordingly, Barca states that it will qualify as a Service-Disabled 
Veteran Owned Business under the Veterans Entrepreneurship and Small 
Business Development Act of 1999, the Veterans Benefit Act of 2003, and 
Executive Order 13360.
    Additional details can be found in Barca's Application, which is 
posted on the DOE/FE Web site at: https://www.fossil.energy.gov/
programs/gasregulation/authorizations/2013_applications/Barca_LNG_
LLC__-FE._DK.__-13-118-LNG.html.

DOE/FE Evaluation

    The Application will be reviewed pursuant to section 3(a) of the 
NGA, 15 U.S.C. 717b(a), and the authority contained in DOE Delegation 
Order No. 00-002.00N (July 11, 2013) and DOE Redelegation Order No. 00-
002.04F (July 11, 2013). In reviewing this LNG export Application, DOE 
will consider any issues required by law or policy. To the extent 
determined to be relevant or appropriate, these issues will include the 
impact of LNG exports associated with this Application, and the 
cumulative impact of any other application(s) previously approved, on 
domestic need for the gas proposed for export, adequacy of domestic 
natural gas supply, U.S. energy security, and any other issues, 
including the impact on the U.S. economy (GDP), consumers, and 
industry, job creation, U.S. balance of trade, international 
considerations, and 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 the Application should address these issues in 
their comments and/or protests, as well as any other issues deemed 
relevant to the Application.
    NEPA requires DOE to give appropriate consideration to the 
environmental effects of its decisions. No final decision will be 
issued in this proceeding until DOE has met its environmental 
responsibilities.
    Due to the complexity of the issues raised by the Applicant, 
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

    In response to this Notice, any person may file a protest, 
comments, or a motion to intervene or notice of intervention, as 
applicable. Any person wishing to become a party to the proceeding 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 will be considered in determining the appropriate 
action to be taken on the Application. All protests, comments, motions 
to intervene, or notices of intervention must meet the requirements 
specified by the regulations in 10 CFR Part 590.
    Filings may be submitted using one of the following methods: (1) 
Emailing the filing to fergas@hq.doe.gov with FE Docket No. 13-118-LNG 
in the title line; (2) mailing an original and three paper copies of 
the filing to the Division of Natural Gas Regulatory Activities at the 
address listed in ADDRESSES; or (3) hand delivering an original and 
three paper copies of the filing to the Office of Natural Gas 
Regulatory Activities at the address listed in ADDRESSES. All filings 
must include a reference to FE Docket No. 13-118-LNG. Please Note: If 
submitting a filing via email, please include all related documents and 
attachments (e.g., exhibits) in the original email correspondence. 
Please do not include any active hyperlinks or password protection in 
any of the documents or attachments related to the filing. All 
electronic filings submitted to DOE must follow these guidelines to 
ensure that all documents are filed in a timely manner. Any hardcopy 
filing submitted greater in length than 50 pages must also include, at 
the time of the filing, a digital copy on disk of the entire 
submission.
    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 is available for inspection and copying in the 
Division of Natural Gas Regulatory Activities docket room, Room 3E-042, 
1000 Independence Avenue SW., Washington, DC 20585. The docket room is 
open between the hours of 8:00 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/.

    Issued in Washington, DC, on December 5, 2013.
John A. Anderson,
Manager, Natural Gas Regulatory Activities, Office of Oil and Gas 
Global Security and Supply, Office of Fossil Energy.
[FR Doc. 2013-29541 Filed 12-10-13; 8:45 am]
BILLING CODE 6450-01-P