U.S. Energy Department Pauses Review of Liquefied Natural Gas Export Applications

The U.S. Energy Department on Jan. 26 announced a temporary pause on pending applications for the export of liquefied natural gas to non-Free Trade Agreement countries while it updates the criteria used to determine whether additional export authorizations are in the public interest.

The U.S. is the global leader in LNG exports with 14 billion cubic feet per day (Bcf/d) in operating capacity and 48 Bcf/d in total authorizations approved to date – more than triple the current export capacity.

The economic and environmental analyses that the department currently relies on to support LNG export authorizations are about five years old, according to a White House fact sheet. These analyses no longer sufficiently address factors such as potential energy cost hikes for consumers and manufacturers beyond existing authorizations, or the most recent evaluation of the impact of greenhouse gas emissions.

The American Petroleum Institute criticized the pause, citing increased project wait times amid geopolitical turmoil and rising global coal use. The group said that the pause benefits Russia, contradicting President Biden’s commitment to bolster LNG shipments to U.S. allies and reduce reliance on Russian gas.

Conversely, Earthjustice, an environmental group, praised the move as a crucial step in aligning the department’s decision-making on LNG exports with U.S. climate goals.

The pause will not affect exports that have been authorized to date or the ability to supply allies in Europe, Asia or other recipients of authorized U.S. exports. In 2023, Europe received over 60 percent of U.S. LNG exports, playing a vital role in replenishing its lost gas supplies after Russia’s invasion of Ukraine. By the end of the decade, an additional 12 Bcf/d of U.S. export capacity, already authorized and under construction, is expected to come online, potentially doubling U.S. exports.