Daily Rules, Proposed Rules, and Notices of the Federal Government
CMI, a Delaware limited liability company with its principal place of business in Houston, Texas, is affiliated with Corpus Christi Liquefaction, LLC (CCL) and Cheniere Corpus Christi Pipeline, L.P. (CCP), the developers of the CCL Project. CMI is an indirect subsidiary of Cheniere Energy, Inc. (Cheniere Energy), 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 CCL Project. CMI is authorized to do business in the States of Texas and Louisiana.
CMI states that it is filing this Application in conjunction with the CCL Project being developed by CMI's affiliates, CCL and CCP, at the site of the previously authorized CCLNG import terminal and associated pipeline in San Patricia and Nueces Counties Texas.
On August 31, 2012, in FE Docket No. 12-99-LNG, CMI filed with DOE/FE a separate application for long-term multi-contract authorization to engage in the export of LNG in an amount up to 782 million MMBtu per year, to any country with which the U.S. does not now or in the future will have an FTA requiring the national treatment for trade in natural gas and LNG; that 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. DOE/FE subsequently issued an order in FE Docket No 12-99-LNG granting long-term export authorization to FTA countries from the CCL Project.
In the instant Application, CMI seeks long-term, multi-contract authorization to export up to 782 million MMBtu per year of LNG, equivalent to approximately 767 Bcf per year of natural gas, for a period of 22 years beginning on the earlier of the date of first export or eight years from the date the authorization is granted by DOE/FE. CMI requests authorization to export LNG to any country with which the United States does not have an FTA requiring national treatment for trade in natural gas, 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.
CMI states that the CCL Project will be located on the northern shore of the La Quinta Channel north and east of the City of Corpus Christi, Texas. CMI states that the CCL Project will include three ConocoPhillips Optimized Cascade
CMI states that concurrent with this Application, CCL is filing an application with the Federal Energy Regulatory Commission (FERC) for authorization pursuant to Section 3(a) of the NGA to site, construct and operate the CCL Terminal, and CCP is filing an application with FERC pursuant to Section 7(c) of the NGA to construct, own and operate the Corpus Christi Pipeline to connect the CCL Terminal facilities to interstate and intrastate natural gas supplies and markets.
CMI states that it proposes to source natural gas to be used as feedstock for LNG production at the CCL Project from the interstate and intrastate grid at points of interconnection with other pipelines and points of liquidity both upstream and downstream of the Pipeline. CMI notes that through the Pipeline's interconnects with various interstate and intrastate pipeline systems, the CCL Project will have access to virtually any point on the U.S. interstate pipeline system through direct delivery or by displacement.
CMI states that it currently is engaged in commercial discussions with CCL to obtain all the available liquefaction capacity at the CCL Terminal. CMI states that either CMI or the CCL Project will bear the responsibility for sourcing gas supplies for delivery to the CCL Terminal. CMI states that CCL will commence negotiations with CCP for transportation capacity on the Pipeline once commercial discussion between CCL and CMI progress.
CMI states that it will comply with all DOE/FE requirements for exporters and agents, including the registration requirements as first established in
CMI states that it has not yet entered into any long-term gas supply or long-term export contracts with regards to this Application. CMI states that, accordingly, it is not submitting transaction-specific information (e.g., long-term supply agreements and long-term export agreements) at this time and requests that DOE/FE make a similar finding to that made in
Lastly, CMI requests that DOE/FE issue a conditional Order authorizing the export of domestically produced LNG as requested in this Application by February 2013, followed by issuance of a final order immediately upon completion of the environmental review of the CCL Project by the FERC.
CMI states that it proposed the project in part due to the improved outlook for domestic natural gas production, owing to drilling productivity gains that have enabled rapid growth in new supplies in South Texas and elsewhere in the United States. CMI contends that improvements in drilling and extraction technologies have coincided with a rapid diffusion of knowledge in the natural gas industry of the resource base and best practices in drilling and resource development. CMI notes that these changes have rendered obsolete once prominent concerns of declining future domestic natural gas production. CMI maintains that authorizing exports of LNG will further the responsible development of these emerging sources of domestic natural gas, providing a positive market solution that will:
(1) Raise domestic natural gas productive capacity and promote stability in domestic natural gas pricing,
(2) Stimulate the regional, state, and national economy through job creation and increased economic activity,
(3) Promote the liberalization of contract structures in global LNG markets by lowering the cost of energy in foreign nations, thereby fostering economic growth abroad and creating demand for U.S.-sourced goods and services,
(4) Expand economic activity and job creation in the domestic natural gas and petrochemicals sectors,
(5) Promote greater national security by expanding American influence in international energy markets while enabling greater production in domestic petroleum basins,
(6) Improve the U.S. balance of payments between $5.88 billion and $9.52 billion annually through the exportation of natural gas and the displacement of imports of other petroleum liquids, and
(7) Increase economic trade and ties with foreign trading partners and hemispheric allies, and displace environmentally damaging fuels in those countries.
In support of its Application, CMI commissioned a report from Advanced Resources International (ARI), titled
In support of its Application, CMI also commissioned a report from the Perryman Group, titled
First, with respect to economic activity, the Perryman Report estimates that the cumulative beneficial direct impact to business activity and tax receipts due to the construction and operation of the CCL project over 25 years will range from $9.9 billion to $11.2 billion to the regional economy, $19.6 billion to $23.5 billion to the Texas economy, and $25.5 billion to $31.1 billion to the U.S. economy.
Second, the Perryman Report estimates that the total indirect benefits due to enhanced natural gas exploration and production investments over 25 years made possible by the CCL Project will be $13.8 billion to the regional economy, $101.0 billion to the Texas economy, and $111.4 billion to the U.S. economy.
Third, with respect to job creation, the Perryman Report estimates the construction and operation of the CCL Project over 25 years will create between 39,823 and 52,613 jobs nationwide, and that an additional 44,341 jobs will be indirectly generated owing to stimulus in the E&P sector.
Fourth, CMI states that another indirect benefit of the CCL Project will be captured by the chemical industry, which CMI says will be advantageously impacted by the additional production of NGLs, such as ethane, made possible through LNG exports. CMI states that the economic benefits due to the construction of new chemical manufacturing facilities supported by exports from the CCL Project will be $1.1 billion to the regional economy, $2.1 billion to the Texas economy, and $3.0 billion to the U.S. economy.
CMI states that these as well as other benefits enumerated in this Application compellingly demonstrate that the export of LNG and the approval of this Application are in the public interest.
Further details can be found in the Application, which has been posted at
CMI states that the potential environment impacts of the Project will be reviewed by the FERC under the National Environmental Policy Act (NEPA). CMI notes that DOE/FE has agreed to act as a cooperating agency in the environmental review process for the CCL project, including the preparation of an EA or EIS, which will satisfy the NEPA responsibilities associated with the LNG exports as proposed in the Application. Accordingly, CMI requests that DOE/FE issue a conditional order authorizing the export of LNG as requested in the Application, conditioned on completion of the environmental review of the CCL Project by the FERC.
The Application will be reviewed pursuant to section 3 of the NGA, as amended, and the authority contained in DOE Delegation Order No. 00-002.00L (April 29, 2011) and DOE Redelegation Order No. 00-002.04E (April 29, 2011). 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 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 environmental responsibilities.
Due to the complexity 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.
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
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 CMI is available for inspection and copying in the Office 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: