Presentation | Authorizations for Certain Activities at Liquefied Natural Gas Plants

Item C-1 | Docket No. RM26-2-001 | News Release

Good morning, Chairman and Commissioners. 

Item C-1 is a Notice of Proposed Rulemaking (or NOPR) that establishes a blanket program for authorizing activities at liquefied natural gas (or LNG) plants without the need for case-specific authorization orders under sections 3 or 7 of the Natural Gas Act. The proposed rule aims to streamline LNG infrastructure development while maintaining safety and environmental protections. 

The Commission regulates the siting, construction, expansion, and operation of LNG plants pursuant to sections 3 and 7 of the Natural Gas Act. 

Broadly, there are two types of LNG plants subject to the Commission’s jurisdiction.  First, LNG import and export terminals, which the Commission regulates under section 3 of the Natural Gas Act.  And second, LNG plants that receive LNG or natural gas from a pipeline and liquefy it, store it as LNG, and regasify it for delivery in interstate commerce, which the Commission regulates under section 7.  The latter are often called peak shavers because they typically receive natural gas to liquefy during low demand periods and then regasify and deliver it during peak demand periods.  Both types of LNG plants are composed of two categories of facilities: LNG facilities and auxiliary systems. LNG facilities receive, load and unload, store, transport, gasify, liquefy, or process natural gas, and auxiliary systems are those necessary to support safe and reliable operation of the plant.

Currently, LNG operators may make modifications to LNG plants that are already-authorized or operating, but the operator may need to file a case-specific application on which the Commission must make a public interest determination.  The Commission previously determined that LNG activities were not appropriate for a blanket authorization program, based on its assessment in 1982 that they “may have a significant impact on ratepayers” and, in 2006, that such activities were not sufficiently routine or well-understood to exempt from case-specific engineering and environmental review. However, the Commission no longer regulates rates under section 3 of the Natural Gas Act and, since 2006, the Commission and the LNG industry have gained substantial experience with LNG plant engineering, safety, and environmental effects.  More recently, the U.S. has become the largest exporter of LNG.  Given this experience, it is appropriate to build on the longstanding success of the Commission’s section 7 pipeline blanket certificate program and provide a similar streamlined review of certain activities at LNG plants.  This would more quickly facilitate the implementation of improvements to increase the safety, reliability, efficiency, and capability of LNG plants, while maintaining safety and environmental protections. 

Thus, on November 20, 2025, the Commission issued a notice of inquiry in this proceeding, soliciting stakeholder comment on whether, and if so how, to revise its regulations toestablish procedures for authorizing activities at LNG plants without the need for case-specific authorization orders.  In response, the Commission received 18 comments from the LNG industry, public interest organizations, and states.  The comments addressed a variety of issues, including the scope of a blanket program, stakeholder notification, safety and environmental impacts, and the suitability of blanket authorization for LNG activities.

After reviewing the comments, the Commission proposes to promulgate regulations to establish an LNG blanket program.  To the extent practicable, the proposed LNG blanket program is modeled after the Commission’s existing section 7 pipeline blanket certificate program.  Specifically, the NOPR proposes to adopt a tiered blanket authorization program with three categories of blanket projects:

1. automatic authorization projects that may proceed automatically after landowner and community notification; 
2. prior notice projects that require a 60-day notice period and an opportunity for Commission staff or stakeholders to protest; and
3. prior notice projects that require a 90-day notice and protest period.

Unlike the section 7 pipeline blanket certificate program, LNG blanket projects would not be subject to cost limits.  Instead, the NOPR establishes defined categories of activities, eligible for one of the previously mentioned tiers, based on the extent of their effects.

In general, activities eligible for automatic authorization include the construction, replacement, or abandonment of components of LNG facilities or auxiliary systems provided the activity would not: 

1. increase the authorized capacity of the LNG plant; 
2. expand the authorized vertical or horizontal extents within the footprint of the LNG plant; or
3. result in changes outside of the design limits of the new or existing equipment.

Activities eligible for 60-day prior notice authorization are similar to those allowed under automatic authorization.  However, 60-day prior notice projects may increase the authorized capacity of the LNG plant, provided that the activities would: 

1. be located within the LNG plant footprint; 
2. not significantly adversely impact reliability or risks to public safety; and
3. not result in changes outside the design limits of the new or existing equipment. 

Activities eligible for 90-day prior notice authorization are those that would involve the construction of new LNG facilities, such as liquefaction trains, LNG tanks, and marine berths.  Such activities may extend outside of the plant footprint provided that they would:

1. permanently occupy no more than 25 acres of previously disturbed or developed land or waterways located within industrial zones or areas without zoning; and
2. be designed using the same in-kind or upgraded LNG facilities and auxiliary systems previously evaluated and authorized at the LNG terminal or plant.

The NOPR would apply to both section 3 LNG terminals and section 7 LNG plants, with the same activities eligible for automatic and 60- and 90-day prior notice authorization. However, only section 7 LNG blanket projects would be subject to the same rate treatment requirements as under the section 7 pipeline blanket certificate program, as proposed to be revised in the Commission’s May 21, 2026 NOPR.

As with the section 7 pipeline blanket certificate program, the NOPR proposes to adopt standard filing requirements and environmental and engineering design conditions to address effects and to ensure compliance with applicable law.  The NOPR explains that Commission staff will prepare an environmental document under the National Environmental Policy Act (or NEPA) to address the environmental effects of automatic authorization and the rulemaking.  Prior notice projects will undergo project-specific NEPA analyses or have a categorical exclusion applied, as occurs under the section 7 pipeline blanket certificate program. 

The NOPR also proposes, among other requirements, that blanket authorization holders must obtain a Letter of Determination from the U.S. Department of Transportation’s Pipeline and Hazardous Material Safety Administration or a determination that a Letter of Determination is not required. 

In addition, to comply with the interagency consultation requirements of section 3 of the Natural Gas Act, the NOPR proposes to require that blanket authorization holders obtain for section 3 blanket projects concurrence from the U.S. Department of War using the department’s Clearinghouse process.  The NOPR also proposes, among other requirements, that blanket authorization holders must obtain for prior notice projects at section 3 LNG terminals: 

1.  a new or updated Letter of Recommendation from the U.S. Coast Guard or a determination that a new Letter of Intent, Waterway Suitability Assessment, or Letter of Recommendation is not required; 
2. a letter from the state designated agency that the project does not raise any state or local safety concerns or evidence that the agency has been notified; and 
3. letters from all relevant state and local emergency response organizations and emergency responders that the project is consistent with the terminal’s Emergency Response Plan or evidence that the organizations have been notified.

The NOPR would waive the Commission’s pre-filing regulations, as LNG blanket projects would not involve significant state and local safety considerations that have not been previously addressed.

The NOPR seeks comment on the proposed changes and specifically on the following discrete issues: 

• whether 25 acres beyond the existing plant footprint is an appropriate acreage limit for 90-day prior notice expansions; 
• whether the Commission should consider any additional limits or criteria for expansions that extend beyond the existing plant footprint; and 
• whether the Commission should establish eligibility criteria concerning who may protest a prior notice project. 

We would like to acknowledge and thank the numerous staff from the Office of Energy Projects and the Office of the General Counsel who worked on the proposed rule.

This concludes our presentation.  We are happy to answer any questions.