U.S. Energy Department Repeals Biden-Era Policy on LNG Export Commencement Deadlines

The U.S. Energy Department on April 1 announced the repeal of a policy statement issued under the Biden administration that required authorized liquefied natural gas exporters to meet specific criteria before the agency would consider extending the commencement date for an approved project. The move aligns with the Trump administration’s efforts to expand U.S. oil and gas production and exports. In January, President Trump issued an executive order lifting a pause on LNG export facility approvals that had been instituted during the Biden administration.

In April 2023, under the Biden administration the department issued a policy statement that mandated LNG projects requesting a commencement deadline extension to both be under construction and be able to prove that extenuating circumstances outside the authorization holder’s control prohibited the start of exports within seven years. The department has now withdrawn the policy statement saying that it added unnecesary red tape to the extensive LNG export permitting process and made it more difficult for operators of approved projects to obtain extensions. Such requests will be evaluated on a case-by-case basis.

This marks the sixth LNG-related issuance under the Trump administration. In February, the department announced a new export authorization enabling Commonwealth LNG to export LNG to non-free trade agreement, or non-FTA, countries. Another order issued in February removed barriers to the utilization of LNG as marine fuel to power vessels. In March, the department granted LNG export permit extensions to Golden Pass LNG terminal and Delfin LNG. Further, Venture Global received approval to export LNG from its CP2 LNG project.

U.S. LNG export profitability has significantly increased since the Russian invasion of Ukraine and the corresponding impact on global gas prices. The Russian invasion of Ukraine led to a structural shift in the market, which has impacted trading dynamics for U.S. LNG.