U.S. Energy Department Grants LNG Export Permit for New Fortress Energy

The U.S. Energy Department has authorized New Fortress Energy to export liquefied natural gas to non-Free Trade Agreement countries, according to a Sept. 3 press release from the company. The approval allows exports of up to ~1.4 million tonnes per annum to non-Free Trade Agreement countries from the company’s Fast LNG 1 facility located offshore Altamira, Mexico for a five-year term.

This marks the first LNG export approval since the department announced a temporary pause on pending applications for LNG exports to non-FTA countries in order to update the criteria used to determine whether additional export authorizations are in the public interest.

The move comes amid projections of significant growth in LNG exports. According to the U.S. Energy Information Administration, North America’s LNG export capacity could more than double between now and 2028. Based on the administration’s projections, North American LNG exports could reach approximately 24.4 bcf/d from its current value of 11.4 bcf/d. By the end of 2028, estimates show LNG export capacity growing by 0.6 bcf/d in Mexico and 9.7 bfc/d in the U.S.

The approval drew criticism from environmental groups with Food & Water Watch saying that it is “ridiculous” to issue this license “despite the administration’s ongoing, incomplete public interest review of such exports.”

FLNG 1 is made up of two floating LNG production units with each unit possessing the capacity to liquefy up to 0.199 Bcf/d of natural gas. In March 2023, NFE received authorization to export LNG to countries that have a free trade agreement with the U.S. Under this authorization, the company can export US-sourced natural gas to its Mexico facility for liquefaction, and re-export this in the form of LNG. NFE can re-export an LNG quantity equivalent to 158 Bcf/yr of natural gas to FTA countries.

In its application to expand exports to non-FTA countries, the company requested the use of 13 Bcf/year of US-sourced natural gas to be liquefied at its Mexico facility. The company requested approval to re-export 145 Bcf/yr of the gas as LNG to both FTA and non-FTA countries. The department approved these conditions in its latest authorization.

However, not all of the company’s initial requests for exporting LNG were approved. In its original application for approval in September 2022, NFE had requested approval to export LNG until Dec. 31, 2050. The department, so far, has only granted authorization for a period of five years from Aug. 31, 2024, to Aug.30, 2029.

The order brings the cumulative total of approved non-FTA exports of LNG from the lower-48 states to 46.45 Bcf/d of natural gas, according to the department. This total includes 6.71 Bcf/d of U.S.-sourced natural gas authorized for re-export in the form of LNG from Mexico and Canada to non-FTA countries.