September 23, 2021
Docket No. CP95-35-000
We concur in today’s order. We write separately to dispel any doubts that Commissioner Danly’s concurrence may raise about our authority to issue the March 26, 2020 Remedial Order.[1] We encourage the parties to focus their briefing on the serious public safety and reliability concerns raised in this proceeding.
As explained below, the Commission’s authority to regulate operational safety at LNG facilities is well-established. It rests on the broad authorizing language in the Natural Gas Act (NGA), complementary language in other relevant federal statutes, and nearly forty of years of consistent agency interpretation and practice. Throughout that time, the Commission has developed a robust LNG regulatory program, staffed by highly experienced experts, on which the public, industry, states, and other federal agencies rely. Neither that program nor this proceeding should be sidetracked by unnecessary briefing concerning our jurisdiction.
Section I below explains that the NGA’s plain language as well as its legislative history support the Commission’s assertion of jurisdiction over the operational safety of LNG facilities. Section II shows that the Natural Gas Pipeline Safety Act’s text and legislative history also reflect Congress’s intent to grant the Commission authority to regulate operational safety. Finally, Section III summarizes the history of the Commission’s LNG regulatory program, and demonstrates that, through its rulemaking, adjudicatory, and other actions over four decades, the Commission has consistently interpreted the NGA to confer authority over operational safety. For the reasons explained in that section, the Commission’s interpretation of its authority is entitled to judicial deference.
NGA’s Language and Legislative History Support Jurisdiction
The analysis of the scope of the Commission’s jurisdiction begins with the text of the NGA, the language of which is interpreted according to its ordinary meaning.[2] The Commission exercises its jurisdiction over LNG facilities under three provisions of the NGA: (1) section 3(a),[3] which through the Department of Energy’s (DOE) delegation grants the Commission the authority to “[a]pprove or disapprove the construction and operation of particular facilities, the site at which such facilities shall be located, and with respect to natural gas that involves the construction of new domestic facilities, the place of entry for imports or exit for exports;”[4] (2) section 3(e), which provides the Commission with the “exclusive authority to approve or deny an application for the siting, construction, expansion, or operation of an LNG terminal;”[5] and (3) section 7(c), which requires Commission authorization before the construction and operation of natural gas facilities operating in interstate commerce.[6] The ordinary meaning of “operation” is the “state of being functional.”[7] Thus, the statutory grant of authority extends to a jurisdictional facility’s operational phase.[8]
That the Commission’s authority extends to LNG facility operations – and every facet of those operations, including safety – is made plain by the NGA’s (1) broad authorizing language, (2) expansive conditioning language, and (3) express grant of authority to issue “supplemental orders” found in section 3(e). First, as to the authorizing language, in Distrigas Corporation v. FPC, the D.C. Circuit described the Commission’s authority over LNG facilities under section 3 as “at once plenary and elastic.”[9] Second, NGA sections 3(a) and 3(e) give the Commission power to condition its authorization of LNG facilities as it deems “necessary or appropriate.”[10] Section 7 includes similarly expansive conditioning language.[11] The Commission’s conditioning authority is “extremely broad”[12] and there is no exclusion for safety-related conditions.[13] Third, and perhaps most compellingly, section 3(a) of the NGA provides that, after issuing its initial authorization, the Commission “may from time to time, after opportunity for hearing, and for good cause shown, make such supplemental order in the premises as it may find necessary or appropriate.”[14] It is hard to imagine a clearer grant to the Commission of on-going authority over the LNG facilities it approves.
The NGA’s legislative history also supports the conclusion that the Commission has authority over operational safety at jurisdictional LNG facilities. Congress added section 3(e) to the statute as part of the Energy Policy Act of 2005 (EPAct 2005) to clarify the Commission’s jurisdiction vis-à-vis that of the states.[15] Section 3(e) gives the Commission “the exclusive authority to approve or deny an application for the siting, construction, expansion, or operation of an LNG terminal.”[16] As discussed below, at the time EPAct 2005 was passed, the Commission had been exercising authority over LNG facility operations for nearly thirty years. Congress was fully aware of the Commission’s LNG program and, rather than draft language limiting the Commission’s ability to provide ongoing oversight, Congress chose to vest Commission with the exclusive authority to approve applications to operate an LNG terminal.
Provisions in the NGA referencing the roles of other federal agencies and the states do not detract from the conclusion that the Commission has authority over operational safety at jurisdictional LNG facilities. Section 3A requires states to notify the Commission prior to conducting operational safety inspections and provides that they may notify the Commission of any alleged safety violations.[17] This provision demonstrates that Congress envisioned the Commission playing an ongoing role in monitoring the operations of LNG terminals after they had gone into service. While the provision also requires the Commission “to transmit information regarding such allegations to the appropriate federal agency, which shall take appropriate action and notify the state,”[18] it does not preclude the Commission itself from acting on that information. The logical reading of this provision, particularly in light of the broad authorizing language in the statute and the Commission’s long history of regulating LNG terminals, is that Congress recognized that concurrent jurisdiction may rest with other agencies, such as DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) and the U.S. Coast Guard, and wanted to ensure that the information was shared with those agencies.[19]
In sum, the NGA’s broad language,[20] as well as its legislative history, amply support the Commission’s assertion of authority over operational safety at jurisdictional LNG facilities.
II. Natural Gas Pipeline Safety Act Text and History Support Jurisdiction
Like the NGA, the Natural Gas Pipeline Safety Act’s (NGPSA) text and legislative history also reflect Congress’s intent to grant the Commission authority to regulate the operational safety of LNG facilities. First enacted in 1968, the NGPSA directs DOT to set “minimum” safety standards, indicating that more stringent safety standards may be imposed.[21] The Act recognizes the Commission’s authority to impose safety requirements in stating that the Secretary may “participate in a proceeding involving safety requirements related to a liquefied natural gas facility before the Commission or a State authority.”[22]
To the extent the language of the NGPSA may be ambiguous, the statute’s legislative history and the amendments to it show that the Commission retained its authority to impose more stringent requirements than DOT. Congress considered striking the word “minimum” from DOT’s mandate, but that effort ultimately failed because “the relationship between the Federal Power Commission and the Department of Transportation with respect to natural gas pipeline safety is clear.”[23] In other words, Congress considered it settled that DOT establishes minimum safety standards, leaving the Commission with authority to impose more stringent standards.
The NGPSA was amended in 1979 and Congress again declined to limit the Commission’s authority. Although the legislative history of that amendment recognized there were jurisdictional questions regarding pipeline safety, no changes to the law were made because the Committee expected that a forthcoming memorandum of understanding (MOU) between FERC and DOT would “resolve this question by a stipulation to the effect that, while FERC will retain its authority to impose safety conditions exceeding DOT’s standards, FERC will generally defer to those standards and exercise its authority only in exceptional cases and after consultation with DOT.”[24] A 1985 MOU between the Commission and DOT did just that, recognizing that under the NGA, the Commission exercises the authority to impose more stringent safety requirements than DOT’s standards “when warranted by special circumstances at any LNG facility within the FERC’s jurisdiction.”[25]
The language and legislative history of both the NGA and the NGPSA support the Commission’s long-standing assertion of authority to regulate operational safety at LNG facilities. Congress’s decision to leave the Commission’s LNG program intact through successive amendments to these statutes reflects that the Commission correctly discerned Congress’s intent to authorize the Commission to regulate operational safety at LNG facilities.
III. History of Commission’s LNG Safety Program Itself Supports Jurisdiction
As described below, the Commission has exercised its authority over LNG operations for decades. Throughout this time, the Commission has included post-construction oversight conditions in its authorizations of LNG facilities, imposed safety restrictions on LNG facilities different from those required by DOT, investigated incidents and recommended actions at operational LNG facilities, required LNG facility operators to file operational reports and submit to regular facility inspections, and issued orders to operating facilities – such as the March 26, 2020 order in this case – requiring changes in operations. Moreover, the Commission has provided by regulation that any changes to an LNG facility or its design, whether occurring before or after the facility has gone into operation, require Commission authorization before they are implemented.[26] It has also entered into MOUs with other federal agencies recognizing the Commission’s role with respect to operational safety at LNG facilities.
Through its rulemaking, adjudicatory, and other actions over the years, the Commission has consistently interpreted the NGA to confer authority over operational safety at LNG facilities. This history has legal significance in that (1) the Commission’s interpretation of its authority is entitled to judicial deference; and (2) Congress may be deemed to have acquiesced in the Commission’s interpretation because the Commission’s regulatory, adjudicatory, investigative and other activities have taken place with Congress’s full knowledge and it has repeatedly declined opportunities to curtail the Commission’s LNG program.
The Commission’s interpretation of the NGA as conferring authority over operational safety at LNG facilities is entitled to judicial deference. Indeed, the Commission’s interpretation of its authority is entitled to the highest level of deference under Chevron U.S.A., Inc. v. Nat. Res. Def. Council, Inc. [27] because Congress has delegated authority to the Commission to make rules and issue orders with the force of law under the NGA.[28] Even the Commission’s interpretations expressed through less formal actions than rulemaking and adjudication are entitled to some degree of judicial deference.[29] The Commission’s consistency in construing its authority over time – in both formal and informal ways –is an important factor weighing in favor of deference.[30]
The history of the Commission’s actions relating to LNG operational safety is also relevant because Congress’s inaction against the backdrop of that history may be deemed “acquiescence” in the Commission’s interpretation of its authority. In Rapanos v. United States, a plurality of the Court recognized that Congress’s failure to act may be construed as “acquiescence” in the agency’s statutory interpretation where there is “overwhelming evidence” that Congress made a considered choice, as would be the case where Congress considered and rejected acting on the precise issue” in controversy.[31] The Commission has continuously made Congress aware of its LNG regulatory program, both through testimony and in its annual budget submissions.[32] Yet, as previously explained,[33] when presented with the “precise issue” of the Commission’s authority, Congress rejected a proposal in 1976 to curtail the Commission’s ability to impose certain safety conditions on LNG facilities. Further, in the 1979 amendment to the NGPSA, Congress chose not to alter the Commission’s LNG program, instead relying on the Commission and DOT to reach agreement regarding the scope of their relative authorities.[34] This is reasonably viewed as “overwhelming evidence” of Congress’s assent to the Commission’s jurisdiction over operational safety.
17. The following brief history of the Commission’s LNG program demonstrates the Commission’s consistent interpretation of the NGA to confer authority over operational safety at LNG facilities. The Commission has had a role in authorizing LNG facilities since the 1940’s[35] and has overseen the operational safety of those facilities since at least the 1970’s.[36] For example, in 1973, the Commission issued an order opening an investigation into a serious accident that occurred at Texas Eastern’s jurisdictional LNG peak-shaving facility.[37] In 1974, in East Tennessee Natural Gas Company,[38] the Commission’s section 7 authorization for an LNG peak-shaving facility included multiple conditions relating to operational safety.
Also in 1974, Chattanooga Gas Company (Chattanooga) challenged the Commission’s authority to enforce certain operational safety requirements at its LNG facility.[39] In that case, the Commission took emergency action and ordered Chattanooga to cease operating its interstate LNG facility because it was in violation of Commission-imposed safety conditions requiring compliance with the National Fire Protection Association Standard No. 59A.[40] On rehearing, the Commission held that, notwithstanding the 1968 NGPSA, it retained its authority under the NGA to require and enforce certain safety conditions.[41] The Commission determined that although DOT has authority to set safety standards, that authority is not exclusive of the Commission’s powers in considering the public convenience and necessity; the Commission explained that it has consistently exercised authority over pipeline safety under NGA section 7.[42] Ultimately, Chattanooga filed a settlement with the Commission that required it to bring the facility into compliance.[43] The settlement was entered into with Commission staff and in consultation with DOT’s Office of Pipeline Safety.
Early in the LNG program’s history, the Commission also required specific changes to a facility’s operation due to safety concerns. For example, in Distrigas Corporation, the Commission conditioned its temporary certificate on Distrigas: (1) curtailing LNG transfer operations when there is junkyard activity immediately adjacent to the LNG transfer line between the dock and terminal area; (2) providing adequate dike height, ditching and land sloping so that the maximum amount of LNG spilled in the event of a transfer line failure is contained within Distrigas property lines;[44] and (3) filing a semi-annual report.[45]
By the end of the 1970’s, the Commission had an established LNG inspection program for jurisdictional facilities.[46] Following investigations, the Commission has required changes in operating LNG facilities to assure safety, including changes to LNG storage tanks. For example, Commission staff oversaw the repair and return to service of the LNG storage tank at the Cove Point terminal.[47] As a result of the findings from that investigation, Commission staff, through its inspection program, required all facilities to have clear transfer communication procedures during operations.
On May 9, 1985, the Commission and DOT entered into the Memorandum of Understanding Regarding Liquefied Natural Gas Facilities (1985 MOU).[48] The 1985 MOU acknowledged DOT’s exclusive authority to promulgate federal safety standards for LNG facilities used in the transportation and associated storage of LNG in or affecting interstate or foreign commerce. However, it also stated that under the NGA, the Commission exercises the authority to impose more stringent safety requirements than DOT’s standards “when warranted by special circumstances at any LNG facility within the FERC's jurisdiction” and that the Commission “exercises its authority to impose requirements which would ensure or enhance operational reliability of its jurisdictional LNG facilities.”
Beginning in the early 2000’s, the Commission approved the construction and operation of numerous new LNG import terminals. In 2003, the Commission’s orders included a delegation of authority to the Director of the Office of Energy Projects to “take whatever steps are necessary to ensure operational reliability and to protect human life, health, property or the environment, including authority to direct the LNG facility to cease operations.”[49] The condition has been included in all LNG authorizations since.
The natural gas markets shifted dramatically after the mid-2000’s due to the increased domestic production of natural gas. As a result, the need for LNG import terminals vanished and developers began investing in LNG export terminals. From 2011 through 2019, the Commission authorized the construction and operation of nearly 20 export terminals. Each authorization included provisions requiring continued operational oversight by the Commission and the ability to take measures to protect life and property.[50]
On February 11, 2004, the Commission, U.S. Coast Guard, and the Research and Special Programs Administration (PHMSA’s predecessor) entered into an Interagency Agreement (IA) to ensure coordination on issues regarding the safety and security of LNG terminals.[51] The IA acknowledges that the Commission can “impose safety requirements to ensure or enhance operational reliability of the LNG facilities within its jurisdiction” and notes that the Commission “conducts inspections of the LNG plant, focusing on equipment, operation, and safety.”
In 2005, in KeySpan LNG, L.P., the Commission extensively discussed its role in LNG safety and how it relates to DOT’s role.[52] About one month before Congress’s passage of EPAct 2005, the Commission denied KeySpan’s application to convert its existing LNG storage facility in Providence, Rhode Island, into an LNG import terminal. The Commission announced a new policy whereby it would not approve a proposal for a new LNG terminal that does not meet the current federal safety standards required of all other new LNG import facilities in the United States.[53] The Commission chose this policy “based on the need to maintain the impressive safety record of the LNG industry, which is due … to the array of safety requirements we impose in authorizing LNG facilities.”[54] The Commission noted that its goal is “to ensure that projects that are found to be in the public interest are constructed and operated in a safe and secure fashion.”[55] After detailing the Commission’s role in evaluating applications for LNG facilities and DOT’s role in establishing standards for LNG facilities, the Commission stated that “our most important duty is ensuring that the project that is authorized is safe and secure [and we] will not authorize an LNG facility if we continue to have questions about safety.”[56]
On August 31, 2018, the Commission and PHMSA entered into an MOU regarding LNG transportation facilities. The MOU’s purpose is to “improve coordination throughout the LNG permit application process for FERC jurisdictional LNG facilities.” As part of the MOU, the agencies agreed to assist one another by sharing information and inspection findings pertaining to the review of LNG operations to enable the agencies to discharge their respective responsibilities. The MOU also stated that each agency “will seek to keep the other informed of newly discovered or emerging safety issues or concerns, including information relating to any incident investigations or enforcement actions that an Agency may undertake, to the extent permitted by law.” The MOU superseded the 1985 MOU, but not the 2004 IA between the Commission, DOT, and the Coast Guard.
In sum, for approximately four decades the Commission has consistently interpreted the NGA to confer authority over operational safety at LNG facilities. Given the NGA’s broad language and legislative history, the Commission’s interpretation is a reasonable one and there is no serious basis to question it now.
IV. Conclusion
The NGA grants the Commission broad authority to regulate the operational safety of jurisdictional LNG facilities. The Commission appropriately exercised that authority in issuing the March 26, 2020 remedial order. What the Commission must decide now is how best to protect the health and safety o[1] 170 FERC ¶ 61,260 (2020).
[2] Sebelius v. Cloer, 569 U.S. 369, 376 (2013) (citing BP America Production Co. v. Burton, 549 U.S. 84, 91 (2006)).
[3] 15 U.S.C. § 717b(a). Section 3(a) provides that “no person shall export any natural gas from the United States to a foreign country or import any natural gas from a foreign country without first having secured an order of the Commission authorizing it to do so.” In Distrigas Corp. v. FPC, 495 F.2d 1057, 1064-66 (D.C. Cir. 1974), cert. denied, 419 U.S. 834 (1974), the court held that the provision empowers the Commission to impose the same certification requirement for LNG facilities, as well as certification conditions, as the Commission applies under section 7 of the statute.
[4] DOE Delegation Order No. 00-004.00A, § 1.21(A) (May 16, 2006) (emphasis added).
[5] 15 U.S.C. § 717b(e) (emphasis added).
[6] Id. § 717f(c).
[7] Operation Definition, Merriam-Webster Dictionary, https://www.merriam-webster.com/dictionary/operation (last visited Sept. 23, 2021).
[8] As Commissioner Danly observes, the Commission’s approach to LNG facilities differs from its approach to natural gas pipelines. EcoEléctrica, L.P., 176 FERC ¶ 61,192, at P 4 (2021) (Danly, Comm’r, concurring). We note that the language in sections 3 and 7 of the NGA is not identical. Moreover, our section 7 regulatory program has its own long history distinct from that of section 3.
[9] 495 F.2d at 1064.
[10] Section 3(a) provides that the Commission “may by its order grant such application, in whole or in part, with such modification and upon such terms and conditions as the Commission may find necessary or appropriate….” 15 U.S.C. § 717b(e)(a). Section 3(e) provides the Commission authority to “approve an application [for an LNG terminal]… in whole or part, with such modifications and upon such terms and conditions as the Commission find[s] necessary or appropriate.” Id. § 717b(e)(3)(A).
[11] Section 7(e) provides that the Commission shall have the power to attach to a certificate issued under section 7(c) “such reasonable terms and conditions as the public convenience and necessity may require.” 15 U.S.C. § 717f(e).
[12] Transcontinental Gas Pipe Line Corp. v. FERC, 589 F.2d 186, 190 (5th Cir. 1979).
[13] In fact, in 1976, Congress rejected an amendment to the NGPSA that would have prohibited the Commission from attaching safety conditions beyond those required by the Department of Transportation (DOT). See H.R. Conf. Rep. 94-1660 (“Federal Power Commission may not attach any condition to the issuance of a certificate of public convenience and necessity, or to the exercise of rights granted under such a certificate, if such condition requires the applicant to comply with any safety standards for pipeline facilities or for the transportation of gas other than safety standards prescribed by the Secretary of Transportation.”).
[14] 15 U.S.C. § 717b(a). DOE’s delegation of authority to the Commission under section 3 includes the power to issue supplemental orders. See DOE Delegation Order No. 00-004.00A, § 1.21(C) (May 16, 2006). The Commission has incorporated the authority to issue supplemental orders into its regulations on LNG facilities. See 18 C.F.R. § 153.11.
[15] Congressional Research Service, RL32205, Liquefied Natural Gas (LNG) Import Terminals: Siting, Safety, and Regulation 16-17 (2009).
[16] 15 U.S.C. § 717b(e)(1) (emphasis added).
[17] Id. § 717b-1(d).
[18] Id.
[19] Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 468 (2001) (“Congress . . . does not alter the fundamental details of a regulatory scheme in vague terms or ancillary provisions—it does not, one might say, hide elephants in mouseholes.”); Morton v. Mancari, 417 U.S. 535, 549 (1974) (“[R]epeals by implication are not favored.” (quoting Posadas v. Nat’l City Bank, 296 U.S. 497, 503 (1936))).
[20] W. Va. Univ. Hosps., Inc. v. Casey, 499 U.S. 83, 98 (1991) (“The best evidence of [congressional] purpose is the statutory text adopted by both Houses of Congress and submitted to the President.”).
[21] 49 U.S.C. § 60103(a).
[22] Id. § 60117(i)(3).
[23] H.R. Conf. Rep. 94-1660 at 4707.
[24] S. Rep. 96-182 at 1980.
[25] Memorandum of Understanding Between the Department of Transportation and the Federal Energy Regulatory Commission Regarding Liquefied Natural Gas Facilities, 31 FERC ¶ 61,232 (1985).
[26] 18 C.F.R. § 153.5(a) (2020) (“Any person proposing to amend an existing Commission authorization, including the modification of existing authorized facilities, shall file with the Commission an application for authorization …”).
[27] 467 U.S. 837, 844 (1984) (courts are bound by agency’s reasonable interpretation of statute where Congress has delegated authority to agency to act with force of law).
[28] In addition to the specific authority to impose conditions on LNG facility authorizations and issue supplemental orders granted under section 3 (discussed in paragraph 4 above), the Commission has general authority under section 16 of the NGA “to perform any and all acts, and to prescribe, issue, make, amend, and rescind such orders, rules, and regulations as it may find necessary or appropriate to carry out the provisions of this act.” 15 U.S.C. § 717o.
[29] United States v. Mead Corp., 533 U.S. 218, 234-35 (2001) (citing Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944) (“We consider that the rulings, interpretations and opinions of the Administrator under this Act, while not controlling upon the courts by reason of their authority, do constitute a body of experience and informed judgment to which the courts and litigants may properly resort for guidance.”)).
[30] See, e.g., Skidmore, 323 U.S. at 140 (consistency with “earlier and later pronouncements” favors deference).
[31] Rapanos v. United States, 547 U.S. 715, 750 (2006) (plurality opinion) (citing Bob Jones Univ. v. United States, 461 U.S. 574, 600-01 (1983) (holding “prolonged and acute” congressional awareness of issue supports finding of acquiescence)) (emphasis in the original).
[32] For example, the Director of the Office of Energy Projects’ March 21, 2007 testimony to the House Homeland Security Committee laid out in detail the Commission’s LNG safety program, noting that “the Office of Energy Projects was reorganized to specifically create a Branch that is dedicated to ensuring that all FERC requirements, including safety and security measures, are complied with throughout the life of the project.” Testimony of J. Mark Robinson Before the Committee on Homeland Security, U.S. House of Representatives (Mar. 21, 2007) at 10, https://archives.bape.gouv.qc.ca/sections/mandats/installation_gaz_naturel-becancour/documents/DB5.2.pdf (last accessed Sept. 22, 2021). The Director further noted that “[u]ltimately, the Director of the Office of Energy Projects has the authority to take whatever measures are necessary to protect life, health, property or the environment.” Id. at 11. In addition, Congress reviews and acts on the Commission’s budget proposals each year and those proposals describe the Commission’s actions in regulating operational LNG facilities.
[33] See supra note 13.
[34] See supra ¶ 11 and note 25.
[35] For example, on July 26, 1949, the Commission issued a section 7 certificate for the construction and operation of an LNG peak-shaving facility in Will County, Illinois. Chicago District Pipeline Co., 8 FPC 1016 (1949).
[36] See S. Rep. 94-852 at 4693 (Statement from Commission Chairman Nassikas stating that the Commission has long exercised its authority over pipeline safety and conditioned the grant of certificates upon the applicant's compliance with certain safety requirements).
[37] Texas E. Transmission Corp., 49 FPC 590 (1973).
[38] E. Tenn. Nat. Gas Corp., 51 FPC 30, 32 (1974).
[39] Chattanooga Gas Co., 51 FPC 1278 (1974).
[40] The Commission imposed the requirement when granting Chattanooga a temporary certificate of public convenience and necessity in 1973.
[41] Chattanooga Gas Co., 51 FPC at 1279.
[42] Id.
[43] Chattanooga Gas Co., 51 FPC 2371 (1974).
[44] In a subsequent order, the Commission noted that, based on a staff investigation, Distrigas had not completed the dike work and required the filing of a report on the progress of construction and when it would be completed. Distrigas Corp., 55 FPC 3025, 3027 (1976).
[45] Distrigas Corp., 54 FPC 894, 896-97 (1975).
[46] See, e.g., Algonquin LNG, Inc., 19 FERC ¶ 61,265 (1982) (“the authorization to be issued herein will contain a semi-annual reporting requirement (Appendix B hereto) and require ALNG to provide the Commission’s staff opportunity to conduct post-certificate inspections of the facility at intervals of no longer than two years. In this regard it is noted that subsequent inspections may indicate that further certificate conditions may be required to protect the public safety and environment.”).
[47] See Dominion Cove Point LNG, L.P., Docket No. CP01-76-000, Letter from Richard R. Hoffman to Anne E. Bomar (Dec. 23, 2003) (authorizing placement of LNG Storage Tank A back in service).
[48] Memorandum of Understanding Between the Department of Transportation and the Federal Energy Regulatory Commission Regarding Liquefied Natural Gas Facilities, 31 FERC ¶ 61,232 (1985).
[49] See Cameron LNG, LLC, 104 FERC ¶ 61,269, at P 28 (2003).
[50] See, e.g., Magnolia LNG, LLC, 155 FERC ¶ 61,033, at PP 113-115 (2016).
[51] Interagency Agreement Among the Federal Energy Regulatory Commission, United States Coast Guard, and Special Programs Administration for Safety and Security Review of Waterfront Import/Export Liquified Natural Gas Facilities (Feb. 11, 2004), available at https://www.ferc.gov/industries-data/natural-gas/overview/lng/2004-intragency-agreement-between-ferc-uscg.dot.
[52] KeySpan LNG, L.P., 112 FERC ¶ 61,028 (2005), reh’g denied, 114 FERC ¶ 61,054 (2006).
[53] In subsequent orders, the Commission clarified that this policy is limited to scenarios where a new LNG import or export terminal was being considered. See Elba Liquefaction Co., LLC, 157 FERC ¶ 61,195 (2016) (“Notwithstanding their broad language, the KeySpan orders do not stand for the rule that in all proceedings involving any LNG facilities the Commission will require compliance with current PHMSA regulations.”).
[54] KeySpan LNG, L.P., 112 FERC at P 57.
[55] Id. P 53 (emphasis added).
[56] Id. P 56. KeySpan argued that its facility, particularly the LNG storage tank, need not meet current DOT standards because it was grandfathered under the NGPSA. KeySpan contended that the Commission could only in exceptional cases and in consultation with DOT impose safety conditions exceeding DOT standards. The Commission acknowledged that DOT has adopted and enforces federal standards for the design and operation of onshore LNG facilities, and that DOT decided that facilities constructed before March 31, 2000, were not subject to its current construction standards. Nevertheless, the Commission stated that “under our regulatory scheme, the Commission must determine if LNG construction proposals are consistent with the public interest” and “[a]s part of our determination, we musqE4t examine safety issues.” Id.