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DOE Conditionally Authorizes Oregon LNG Exports

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The U.S. government has opened the door for increased energy exports with the recent authorization for an Oregon company to begin shipping natural gas products overseas.

The Energy Department conditionally authorized LNG Development Co. LLC (Oregon LNG) to export domestically produced liquefied natural gas (LNG) to countries that do not have a Free Trade Agreement (FTA) with the United States, from the Oregon LNG Terminal in Warrenton, Oregon.

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The Oregon LNG application was next in the order of precedence and review of the application was initiated before the Department of Energy issued a proposed procedural change. Subject to environmental review and final regulatory approval, the facility is conditionally authorized to export at a rate of up to the equivalent of 1.25 billion cubic feet per day (Bcf/d) of natural gas, for a period of 20 years.

The development of U.S. natural gas resources is having a transformative impact on the U.S. energy landscape, helping to improve our energy security while spurring economic development and job creation around the country, according to a DOE statement. This increase in domestic natural gas production is expected to continue, with the U.S. Energy Information Administration forecasting a record production rate of 73.29 Bcf/d in 2014.

However as part of the review process, the Energy Department took into consideration indications from Oregon LNG that the predominant amount of natural gas supply for export from the facilities would come from Canada, not the United States.

Federal law generally requires approval of natural gas exports to countries that have an FTA with the United States. For countries that do not have an FTA with the United States, the Natural Gas Act directs the DOE to grant export authorizations unless the department finds that the proposed exports “will not be consistent with the public interest.”

The Energy Department conducted an extensive, careful review of the application to export LNG from the Oregon LNG Terminal. Among other factors, the Department considered the economic, energy security and environmental impacts — as well as public comments for and against the application and nearly 200,000 public comments related to the associated analysis of the cumulative impacts of increased LNG exports — and determined that exports from the terminal at a rate of up to 1.25 Bcf/d for a period of 20 years was not inconsistent with the public interest.

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