On Monday, the Biden administration appealed a federal court decision in January that ruled the US Department of Energy “must act expeditiously” on applications to export LNG to non-free trade agreement nations. The government had sought to pause the process.
If the appeal succeeds then that could further delay the review of pending non-FTA approvals, said Jason Feer, global head of business intelligence at consultancy Poten & Partners.
“I think the approvals process is likely to resume after the election, but likely with new requirements that new applicants will have to clear,” Feer said.
He said more delays are likely because many projects will now have to reapply or seek an extension to non-FTA authorisations because they won’t have enough time to promote, finance and build their projects before their authorisations expire.
The appeal comes as Europe is hoping to import more US LNG later this decade amid efforts to wean off Russian gas.
The appeal marks the latest delay affecting companies with 12 large-scale projects or expansion plans that were under review at the time the pause was announced and that are still pending, according to figures from the Center for Liquefied Natural Gas.
The projects remain stalled regardless of the court decision in January, said Charlie Riedl, executive director at the Center for Liquefied Natural Gas, a Washington DC-based trade group.
“There’s no teeth or enforcement mechanism that requires the DOE to take action,” Reidle said. “They’ve made it extremely difficult for project developers to challenge this.”
Feer agreed. “The court did not set any deadlines and I don’t think there is any way to force the DOE to speed up its process, especially in light of the agency’s intention to change the requirements,” he said.
“This is not necessarily a terrible thing – unless you are a project developer – as there is a huge amount of new LNG coming into the market between 2025 and 2028, so that will give the market some time to absorb that supply before additional projects come online,” he added.
Source: Monte
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