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The Biden administration is considering a delay in the approval process of Venture Global’s Calcasieu Pass 2 LNG project in Louisiana in order to include an accounting of its impact on climate change, The New York Times originally reported Jan. 24.
The report was attributed to confidential sources identified as three people with knowledge of internal administration deliberations. Specifically, the White House has told the Department of Energy (DOE) to expand the criteria a project must meet for approval to include climate change along with the economic and national security implications.
Currently, the DOE is required to consider a project’s “public interest,” a subjective criteria that does not include CO2's effect on the global environment.
The new regulation would affect 16 other potential LNG terminals, either planned or already under construction along the Gulf Coast.
Venture Global’s CP2 LNG project would be built on a 546-acre site in Cameron Parish with an export capacity of 24 MMmt/y, and is slated to open in 2025. The project, along with the original Calcasieu Pass terminal, represents a more than $10 billion investment, according to Venture Global.
The move by the Biden administration comes during an election year, as the White House seeks to shore up report among environmentalists, according to the Times.
In a prepared statement, Venture Global spokeswoman Shaylyn Hynes complained that people in the White House are seemingly trying to force policymaking through media leaks.
“This continues to create uncertainty about whether our allies can rely on U.S. LNG for their energy security,” Hynes stated. “If this leaked report from anonymous White House sources is true, it appears the administration may be putting a moratorium on the entire U.S. LNG industry.
“Such an action would shock the global energy market, having the impact of an economic sanction, and send a devastating signal to our allies that they can no longer rely on the United States,” she added. “The true irony is this policy would hurt the climate and lead to increased emissions as it would force the world to pivot to coal.”
Senate Minority Leader Mitch McConnell blasted the report on the Senate floor on Jan. 24.
“When President Biden took office the average approval time for (LNG) permits was about seven weeks. Right now, it’s about 11 months,” McConnell said. “But soon wait times could become irrelevant … This move would amount to a functional ban on new LNG export permits. The administration’s war on affordable domestic energy has been bad news for American workers and consumers alike.”
It was the second report in the first month of the year that the White House is considering adding a climate change requirement to LNG export terminal approval. On Jan. 9, Politico reported that the White House was considering a climate change as a national interest when judging the viability of an LNG project.
The U.S. currently is the global leader in LNG exports, shipping out 11.6 Bcf/d, according to the U.S. Energy Information Administration. The report from the White House comes about a year before new LNG export terminals, built to take an abundant U.S. natural gas supply to high-demand markets in Europe and Asia are expected to start coming online. The country’s export capacity is expected to more than double to 24.3 Bcf/d by the end of 2027.
The growth has brought more attention from environmentalists, who say that creating LNG from natural gas is an energy-intensive process, and that the U.S. should focus on developing alternative forms of energy.
Oil and gas industry analysts note that burning gas releases a little more than half of the CO2 released from burning coal, and that cutting off the LNG supply to allies would hurt the U.S.’ geopolitical standing.
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