35106 Federal Register / Vol. 83, No. 143 / Wednesday, July 25, 2018 / Rules and Regulations 

markets both domestically and 

internationally. They are funded 

through assessments paid by persons 

subject to the assessment. Checkoff 

programs are administered by national 

boards created for that purpose and 

oversight is provided by USDA. 

Some checkoff programs are 

authorized by their own commodityspecific Federal statutes. Others, like the 

sorghum and lamb checkoff programs 

addressed by this direct final rule, are 

authorized by the Commodity 

Promotion, Research, and Information 

Act of 1996, 7 U.S.C. 7401 et seq. 

(Generic Act). 

The Sorghum and Lamb Orders 

authorize the collection of assessments 

from, respectively, sorghum producers 

and importers, and lamb producers, 

feeders, seedstock producers, first 

handlers, and exporters. Under both 

Orders, payers of assessments are 

entitled to vote in referenda on the 

continuation, suspension, or 

termination of their checkoff programs. 

The Generic Act provides that two 

referenda must be conducted in each 

checkoff program created pursuant to its 

authority. The first referendum must be 

conducted either before a checkoff 

program goes into effect (to ascertain 

whether the Order is favored by the 

persons to be covered by it) or, 

alternatively, within 3 years after 

assessments begin (to determine 

whether a majority favors the 

continuation, suspension, or 

termination of the program). The second 

referendum must be conducted within 7 

years after assessments begin to 

determine whether a majority favors the 

continuation, suspension, or 

termination of the program. All persons 

subject to assessments are allowed to 

vote in referenda. 

The Sorghum and Lamb Orders each 

incorporate provisions for two required 

referenda, the first within 3 years and 

the second within 7 years after 

assessments begin. Both Orders contain 

provisions for assessment payers to 

obtain refunds of assessments and for 

both boards to maintain escrow 

accounts ahead of these referenda. All of 

those referenda, two for sorghum and 

two for lamb, were conducted within 

the time frames defined by the Orders. 

In each of the four referenda, a large 

majority approved the relevant 

program’s continuance. Those referenda 

will not be repeated. Thus, AMS is 

removing the sections and paragraphs of 

the Sorghum and Lamb Orders that 

relate to refunds and escrow accounts 

because they are obsolete. 

In the Sorghum Order, §§ 1221.112(g), 

1221.112(h), 1221.118, 1221.119, and 

1221.120, which provided for escrow 

accounts and refunds in connection 

with required referenda, will be 

removed. In § 1221.112, paragraphs (i) 

through (m) will be redesignated as (g) 

through (k), respectively. A conforming 

change will be made to § 1221.128(a) to 

correct a reference. 

In the Lamb Order, §§ 1280.214, 

1280.215, 1280.216, and 1280.403, 

which provided for escrow accounts 

and refunds in connection with required 

referenda, will be removed. 

AMS is issuing this direct final rule 

without a preceding proposed rule 

because this action is a routine, 

noncontroversial regulatory change that 

AMS believes will not generate adverse 

comment. The rule is conditional on the 

non-receipt of adverse comments. If 

adverse comment is received, AMS will 

withdraw the rule before the effective 

date. 

List of Subjects 

7 CFR Part 1221 

Administrative practice and 

procedure, Advertising, Agricultural 

research, Reporting and recordkeeping 

requirements, Sorghum. 

7 CFR Part 1280 

Administrative practice and 

procedure, Advertising, Agricultural 

research, Meat and meat products, 

Reporting and recordkeeping 

requirements. 

For reasons set forth in the preamble, 

AMS is amending 7 CFR parts 1221 and 

1280 as follows: 

PART 1221—SORGHUM PROMOTION, 

RESEARCH, AND INFORMATION 

ORDER 

■ 1. The authority citation for part 1221 

continues to read as follows: 

Authority: 7 U.S.C. 7411–7425 and 7 

U.S.C. 7401. 

§ 1221.112 [Amended] 

■ 2. In § 1221.112 remove paragraphs (g) 

and (h) and redesignate paragraphs (i) 

through (m) as paragraphs (g) through 

(k), respectively. 

§§ 1221.118, 1221.119, and 1221.120 

[Removed] 

■ 3. Remove §§ 1221.118, 1221.119, and 

1221.120. 

■ 4. Revise § 1221.128(a) to read as 

follows: 

§ 1221.128 Qualification. 

(a) Organizations receiving 

qualification from the Secretary will be 

entitled to submit requests for funding 

to the Board pursuant to § 1221.112(h). 

Only one sorghum producer 

organization per State may be qualified. 

* * * * * 

PART 1280—LAMB PROMOTION, 

RESEARCH, AND INFORMATION 

ORDER 

■ 5. The authority citation for part 1280 

continues to read as follows: 

Authority: 7 U.S.C. 7411–7425 and 7 

U.S.C. 7401. 

§§ 1280.214, 1280.215, 1280.216, and 

1280.403 [Removed] 

■ 6. Remove §§ 1280.214, 1280.215, 

1280.216, and 1280.403. 

Dated: July 20, 2018. 

Bruce Summers, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2018–15893 Filed 7–24–18; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF ENERGY 

10 CFR Part 590 

[FE Docket No. 17–86–R] 

RIN 1901–AB43 

Small-Scale Natural Gas Exports 

AGENCY: Office of Fossil Energy, 

Department of Energy. 

ACTION: Final rule. 

SUMMARY: The Department of Energy 

(DOE or the Department) is revising its 

regulations to provide that DOE will 

issue an export authorization upon 

receipt of any complete application that 

seeks to export natural gas, including 

liquefied natural gas (LNG), to countries 

with which the United States has not 

entered into a free trade agreement 

(FTA) requiring national treatment for 

trade in natural gas and with which 

trade is not prohibited by U.S. law or 

policy (non-FTA countries), provided 

that the application satisfies the 

following two criteria: The application 

proposes to export natural gas in a 

volume up to and including 51.75 

billion cubic feet (Bcf) per year (Bcf/yr) 

(equivalent to 0.14 Bcf per day (Bcf/d)), 

and DOE’s approval of the application 

does not require an environmental 

impact statement (EIS) or an 

environmental assessment (EA) under 

the National Environmental Policy Act 

of 1969 (NEPA). Applications that 

satisfy these criteria are requesting 

authorization for ‘‘small-scale natural 

gas exports,’’ and DOE deems such 

exports to be consistent with the public 

interest under the Natural Gas Act 

(NGA). DOE’s regulations regarding 


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1This final rule does not apply to exports to FTA 

countries under section 3(c) of the NGA, 15 U.S.C. 

717b(c). This final rule also does not affect existing 

DOE authorizations or DOE’s evaluation of any nonFTA application that does not meet the criteria for 

small-scale natural gas exports. 

2See Sierra Club v. U.S. Dep’t of Energy, 867 F.3d 

189, 203 (D.C. Cir. 2017) (‘‘We have construed 

[NGA section 3(a)] as containing a ‘general 

presumption favoring [export] authorization.’ ’’) 

(quoting W. Va. Pub. Serv. Comm’n v. U.S. Dep’t 

of Energy, 681 F.2d 847, 856 (D.C. Cir. 1982)). 

3See id. (‘‘there must be ‘an affirmative showing 

of inconsistency with the public interest’ to deny 

the application’’ under NGA section 3(a)) (quoting 

Panhandle Producers & Royalty Owners Ass’n v. 

Econ. Regulatory Admin., 822 F.2d 1105, 1111 (D.C. 

Cir. 1987)). 

4 In this final rule, DOE is changing the volume 

criterion from a daily limitation of ‘‘up to and 

including 0.14 Bcf/d,’’ as stated in the proposed 

rule, to an annualized limitation of ‘‘up to and 

including 51.75 Bcf/yr.’’ This change does not affect 

the total volume, as 0.14 Bcf/d and 51.75 Bcf/yr 

represent the same amount of natural gas expressed 

in different terms. DOE has determined that 

expressing the volume criterion in an annualized 

figure is both more consistent with industry 

practice and more practicable for DOE’s 

administration of the small-scale export program. 

notice of applications and procedures 

conducted on applications do not apply 

to applications that satisfy these criteria. 

This regulation is intended to expedite 

DOE’s processing of these applications 

and reduce administrative burdens for 

the small-scale natural gas export 

market. 

DATES: This final rule is effective August 

24, 2018. 

FOR FURTHER INFORMATION CONTACT: 

Amy Sweeney, U.S. Department of 

Energy (FE–34), Office of Regulation 

and International Engagement, Office of 

Fossil Energy Forrestal Building, Room 

3E–042, 1000 Independence Avenue 

SW, Washington, DC 20585; (202) 586– 

2627; or Cassandra Bernstein or Ronald 

(R.J.) Colwell, U.S. Department of 

Energy (GC–76), Office of the Assistant 

General Counsel for Electricity and 

Fossil Energy, Forrestal Building, Room 

6D–033, 1000 Independence Ave. SW, 

Washington, DC 20585; (202) 586–9793 

or (202) 586–8499. 

SUPPLEMENTARY INFORMATION: 

Acronyms and Abbreviations. A 

number of acronyms and abbreviations 

are used in this final rule and set forth 

below for reference. 

AEO Annual Energy Outlook 

APA Administrative Procedure Act 

Bcf/d Billion Cubic Feet per Day 

Bcf/yr Billion Cubic Feet per Year 

CNG Compressed Natural Gas 

DOE Department of Energy 

EA Environmental Assessment 

EIA U.S. Energy Information 

Administration 

EIS Environmental Impact Statement 

FE Office of Fossil Energy, U.S. Department 

of Energy 

FERC Federal Energy Regulatory 

Commission 

FTA Free Trade Agreement 

ISO ISO IMO7/TVAC–ASME LNG 

LNG Liquefied Natural Gas 

mtpa Million Metric Tons per Annum 

NEPA National Environmental Policy Act 

of 1969 

NGA Natural Gas Act of 1938 

I. Background 

II. Discussion of Final Rule and Response to 

Comments 

A. Public Interest Determination 

1. General 

2. Scope of Rule 

3. Public Interest Standard 

4. Domestic Supply of Natural Gas 

5. Cumulative Impacts 

6. Economic Impacts 

7. Environmental Issues 

8. Administrative Procedures and Judicial 

Review Under the Natural Gas Act 

B. Regulatory Criteria 

1. Volume Limitation 

2. Categorical Exclusion From NEPA 

C. Other Issues 

III. Regulatory Review 

A. Executive Orders 12866 and 13563 

B. Executive Orders 13771, 13777, and 

13783 

C. National Environmental Policy Act 

D. Regulatory Flexibility Act 

E. Paperwork Reduction Act 

F. Unfunded Mandates Reform Act of 1995 

G. Treasury and General Government 

Appropriations Act, 1999 

H. Executive Order 13132 

I. Executive Order 12988 

J. Treasury and General Government 

Appropriations Act, 2001 

K. Executive Order 13211 

L. Congressional Notification 

IV. Approval of the Office of the Secretary 

I. Background 

The Department of Energy is 

responsible for authorizing exports of 

domestically produced natural gas to 

foreign nations pursuant to section 3 of 

the NGA, 15 U.S.C. 717b. For 

applications to export natural gas to 

non-FTA countries under NGA section 

3(a), 15 U.S.C. 717b(a),1 DOE has 

consistently interpreted section 3 of the 

NGA as creating a rebuttable 

presumption that a proposed export of 

natural gas is in the public interest.2

Accordingly, DOE will conduct an 

informal adjudication and grant a nonFTA application unless DOE finds that 

the proposed exportation will not be 

consistent with the public interest.3

Before reaching a final decision, DOE 

must also comply with NEPA, 42 U.S.C. 

4321 et seq. 

In this final rule, DOE revises its 

regulations to expedite the application 

and approval process for ‘‘small-scale’’ 

exports of natural gas to non-FTA 

countries, pursuant to section 3(a) of the 

NGA. This emerging market involves 

exports of small volumes of natural gas 

from the United States to countries 

primarily in, but not limited to, the 

Caribbean, Central America, and South 

America. The small-scale export market 

has developed as a solution to the 

practical and economic constraints 

limiting large-scale natural gas exports 

to these countries. In contrast to largescale natural gas exports, small-scale 

exports typically originate from existing 

facilities in the United States, are 

transported shorter distances, and rely 

on a variety of transportation modes, 

such as approved ISO IMO7/TVAC– 

ASME LNG (ISO) containers loaded 

onto container ships and barges. DOE 

believes that facilitating small-scale 

natural gas exports will allow for greater 

diversity and competition in the natural 

gas market, consistent with the public 

interest under NGA section 3(a). 

For each small-scale export 

application submitted to DOE, DOE will 

first determine if the application is 

complete under DOE’s regulations. If the 

application is complete, DOE will post 

the application on DOE’s website, 

consistent with DOE practice. This final 

rule establishes that, upon receipt of any 

complete application to export natural 

gas (including LNG) to non-FTA 

countries, DOE will grant the 

application provided that it satisfies the 

following two criteria: (1) The 

application proposes to export natural 

gas in a volume up to and including 

51.75 Bcf/yr 4 (10 CFR 590.102(p)(1)); 

and (2) DOE’s approval of the 

application does not require an EIS or 

EA under NEPA (10 CFR 

590.102(p)(2))—that is, the application 

is eligible for a categorical exclusion 

under DOE’s NEPA regulations. 

Any non-FTA application that 

satisfies these two criteria will qualify 

as a ‘‘small-scale natural gas export’’ as 

that term is defined under this final rule 

(10 CFR 590.102(p)), and will be 

deemed to be consistent with the public 

interest under NGA section 3(a) (10 CFR 

590.208(a)). DOE will issue an export 

authorization granting the application 

on an expedited basis. Specifically, DOE 

will not provide notice of each 

individual application nor apply other 

procedures typically conducted for nonFTA export applications under DOE’s 

regulations, 10 CFR 590.205 and 10 CFR 

part 590, subpart C (10 CFR 590.303–10 

CFR 590.317). 

On September 1, 2017, DOE 

published the notice of proposed 

rulemaking (NOPR or proposed rule) to 

revise its regulations to provide for this 

expedited approval of small-scale export 

applications (82 FR 41570; Sept. 1, 

2017). Publication of the NOPR began a 

45-day public comment period that 

ended on October 16, 2017. DOE 

received approximately 85 unique 


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5As of the date of the proposed rule, DOE had 

issued 28 final authorizations to export LNG or 

compressed natural gas (CNG) to non-FTA countries 

(82 FR 41572). After the proposed rule was 

published, DOE issued an additional non-FTA 

export authorization. See Eagle LNG Partners 

Jacksonville II LLC, DOE/FE Order No. 4078, FE 

Docket No. 17–79–LNG, Opinion and Order 

Granting Long-Term, Multi-Contract Authorization 

to Export Liquefied Natural Gas in ISO Containers 

Loaded at the Eagle Maxville Facility in 

Jacksonville, Florida, and Exported by Vessel to 

Free Trade Agreement and Non-Free Trade 

Agreement Nations (Sept. 15, 2017). Thus, to date, 

DOE has issued 29 final export authorizations to 

non-FTA countries, bringing the cumulative total of 

approved non-FTA exports of LNG and CNG to 

21.35 Bcf/d of natural gas, or 7.79 trillion cubic feet 

per year. See id. at 34–37. 

6U.S. Energy Info. Admin., Annual Energy 

Outlook 2017 (Jan. 2017), available at: https://

www.eia.gov/outlooks/archive/aeo17/. 

7U.S. Energy Info. Admin., Annual Energy 

Outlook 2018 (Feb. 2018), available at: http://

www.eia.gov/outlooks/aeo. 

8Center for Energy Studies at Rice University 

Baker Institute and Oxford Economics, The 

Macroeconomic Impact of Increasing U.S. LNG 

Exports (Oct. 29, 2015), available at: http://

energy.gov/sites/prod/files/2015/12/f27/20151113_

macro_impact_of_lng_exports_0.pdf [hereinafter 

2015 LNG Export Study]. 

9On June 12, 2018, DOE published a notice of 

availability of the 2018 LNG Export Study and 

request for comments. See U.S. Dep’t of Energy, 

Study on Macroeconomic Outcomes of LNG 

Exports, 83 FR 27314 (June 12, 2018). 

comments on the NOPR from a variety 

of sources, including natural gas 

industry groups, environmental 

organizations, and individuals. The 

NOPR and comments received on the 

NOPR can be accessed through DOE’s 

website at https://www.energy.gov/fe/ 

articles/notice-proposed-rulemakingregarding-small-scale-lng-exports. 

For additional background 

information on this final rule, please see 

the proposed rule. In the proposed rule, 

DOE provides information on DOE’s 

practice of issuing non-FTA export 

authorizations and the various studies 

DOE has commissioned to evaluate the 

reasonably foreseeable economic and 

environmental impacts of natural gas 

exports—including those that would 

qualify as small-scale exports under this 

final rule. 

II. Discussion of Final Rule and 

Response to Comments 

DOE has evaluated the comments 

received during the public comment 

period. In this section, DOE discusses 

the relevant, significant comments 

received on the proposed rule and 

provides DOE’s responses to those 

comments. Some commenters raised a 

variety of other concerns that are 

outside the scope of the rule—including 

criticizing individual LNG export 

projects currently in operation or 

pending before DOE and questioning the 

scope of the Federal Energy Regulatory 

Commission’s (FERC) jurisdiction over 

certain types of LNG export facilities 

under NGA section 3. DOE does not 

address these comments in the final 

rule. 

A. Public Interest Determination 

1. General 

In issuing this final rule, DOE has 

determined that small-scale natural gas 

exports are consistent with the public 

interest under NGA section 3(a). In 

reaching this conclusion, DOE has 

considered its obligations under NGA 

section 3(a), the public comments 

received on the proposed rule, and a 

wide range of information bearing on 

the public interest, including (but not 

limited to) information on economic 

impacts, international impacts, security 

of domestic natural gas supply, and 

environmental impacts associated with 

these exports (82 FR 41573–41574; Sept. 

1, 2017). 

Additionally, DOE has considered the 

29 final non-FTA export authorizations 

issued to date,5 as well as authoritative 

projections for natural gas supply, 

demand, and prices set forth in the U.S. 

Energy Information Administration’s 

(EIA) Annual Energy Outlook 2017 

(AEO 2017) 6 (discussed in the proposed 

rule) and Annual Energy Outlook 2018 

(AEO 2018).7 With respect to the 

regulatory criteria established by this 

rulemaking, DOE considered industry 

sources in establishing the volume 

limitation, as well as its obligations 

under NEPA in establishing the NEPA 

criterion. 

In sum, DOE has thoroughly analyzed 

the many factors affecting the export of 

U.S. natural gas, as well as the unique 

characteristics and minimal adverse 

impacts of the emerging small-scale 

natural gas market. On this basis (and as 

discussed in the proposed rule), DOE 

has determined that the final rule is in 

accordance with section 3 of the NGA, 

DOE’s interpretation of the public 

interest standard set forth in NGA 

section 3(a), and DOE’s long-standing 

policy of minimizing federal control and 

involvement in energy markets and 

promoting a balanced and mixed energy 

resource system. Based on this 

evidence, 10 CFR 590.208 of the final 

rule establishes that small-scale natural 

gas exports, as defined in 10 CFR 

590.102(p), are deemed to be consistent 

with the public interest under NGA 

section 3(a). 

Many commenters expressed overall 

support for DOE’s authorization of LNG 

exports and, specifically, for DOE’s 

efforts to expedite the approval of 

applications for small-scale natural gas 

exports to non-FTA countries. Several 

commenters agreed that small-scale 

natural gas exports are an important 

emerging market that DOE should 

facilitate through a streamlined 

approval process for qualifying 

applicants. They commented that smallscale exports will provide a variety of 

benefits both to the United States and to 

the anticipated importing countries 

primarily located in the Caribbean, 

Central America, and South America. 

Benefits identified for the United States 

include stimulating the natural gas 

market, generating economic growth, 

strengthening the global natural gas 

market, and enhancing U.S. national 

security interests abroad. Benefits 

identified for the importing countries 

include expanding natural gas markets 

and providing access to cleaner and 

more reliable sources of energy. 

Commenters also expressed support for 

DOE’s regulatory definition of ‘‘smallscale natural gas export,’’ such that 

qualifying applications are deemed 

consistent with the public interest; as 

well as DOE’s efforts to reduce 

regulatory burdens for these applicants. 

DOE generally agrees with these 

comments and recognizes the variety of 

important benefits that are expected to 

occur under the final rule. 

2. Scope of Rule 

Some commenters remarked that this 

rulemaking is an important step, yet 

encouraged DOE to liberalize all natural 

gas exports—not just qualifying smallscale natural gas exports—to ensure that 

the benefits of natural gas exports can be 

fully realized. 

Based on findings from The 

Macroeconomic Impact of Increasing 

U.S. LNG Exports (2015 LNG Export 

Study),8 DOE agrees that higher natural 

gas exports are associated with 

marginally higher macroeconomic 

benefits to the United States (82 FR 

41572).9 This rulemaking focuses only 

on small-scale natural gas exports to 

non-FTA countries, in light of the 

unique characteristics and minimal 

adverse impacts associated with that 

market. Insofar as the commenters are 

suggesting that DOE undertake 

additional deregulatory efforts under 

NGA section 3(a), DOE welcomes 

suggestions, data, and information on 

this topic through its regulatory reform 

email inbox at Regulatory.Review@

hq.doe.gov. 

3. Public Interest Standard 

Several commenters disagreed with 

various aspects of DOE’s public interest 

analysis generally. For example, some 

commenters disagreed with DOE’s 

position that NGA section 3(a) creates a 


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10See supra note 1. 

11See id. 

12See, e.g., Eagle LNG Partners Jacksonville II 

LLC, DOE/FE Order No. 4078, at 8–10, supra note 

5. 

13See Sierra Club v. U.S. Dep’t of Energy, 867 

F.3d 189 (D.C. Cir. 2017) (denying petition for 

review challenging non-FTA export authorization); 

Sierra Club v. U.S. Dep’t of Energy, Nos. 16–1186, 

16–1252, 16–1253, 703 Fed. Appx. 1 (D.C. Cir. Nov. 

1, 2017) (denying petitions for review challenging 

three non-FTA export authorizations). 

14See Sierra Club, 867 F.3d at 203; see also, e.g., 

W. Va. Pub. Serv. Comm’n v. U.S. Dep’t of Energy, 

681 F.2d 847 (D.C. Cir. 1982); Panhandle Producers 

and Royalty Owners Ass’n v. Economic Regulatory 

Admin., 822 F.2d 1105 (D.C. Cir. 1987); Panhandle 

Producers and Royalty Owners Ass’n v. Economic 

Regulatory Admin., 847 F.2d 1168 (1988). 15See supra note 13. 

16See Eagle LNG Partners Jacksonville II LLC, 

DOE/FE Order No. 4078, at 34–37, supra note 5. 

17See, e.g., U.S. Energy Info. Admin., Existing 

and Under Construction Large Scale U.S. 

Liquefaction Facilities (June 18, 2018), available at: 

https://www.eia.gov/naturalgas/U.S.liquefaction

capacity.xlsx (also see Contents tab); Cheniere 

Energy, Inc., ‘‘Cheniere Makes Positive Final 

Investment Decision on Train 3 at the Corpus 

Christi Liquefaction Project’’ (May 22, 2018), 

available at: http://phx.corporate-ir.net/ 

phoenix.zhtml?c=101667&p=irol-news

Article&ID=2350302. 

rebuttable presumption that natural gas 

exports are consistent with the public 

interest. Some stated that Congress, not 

DOE, must define ‘‘public interest’’ 

under section 3(a), whereas other 

commenters criticized DOE for not 

providing a regulatory definition of the 

public interest. Another commenter 

suggested that applications to export 

natural gas should be subjected to the 

same standard, regardless of whether 

the natural gas is being exported to FTA 

or non-FTA countries. 

As an initial matter, section 3 of the 

NGA (as amended by section 201 of the 

Energy Policy Act of 1992 (Pub. L. 102– 

486)) distinguishes between exports to 

non-FTA countries under section 3(a) 

and FTA countries under section 3(c).10

These provisions establish different 

standards of review for proposed 

exports to FTA and non-FTA countries, 

and DOE has comported with the 

appropriate standard of review for the 

future non-FTA exports at issue in this 

rulemaking.11

In every non-FTA authorization to 

date,12 as well as in the proposed rule 

(82 FR 41571–41572; Sept. 1, 2017), 

DOE has explained its interpretation of 

the public interest analysis under NGA 

section 3(a). The commenters’ concerns 

reflect a lack of familiarity with both the 

statute and DOE’s long-standing practice 

in evaluating non-FTA applications—a 

practice that was upheld by the U.S. 

Court of Appeals for the District of 

Columbia Circuit in a series of cases 

decided in 2017.13 Indeed, the D.C. 

Circuit has consistently affirmed DOE’s 

interpretation that NGA section 3(a) 

creates a rebuttable presumption 

favoring authorization of applications to 

import or export natural gas.14

Although section 3(a) establishes a 

broad public interest standard and a 

presumption favoring export 

authorizations, Congress has not defined 

the phrase ‘‘public interest’’ or 

identified specific criteria that must be 

considered in issuing a non-FTA 

authorization under that statute. As a 

result, DOE has identified a range of 

factors, described above, that it 

considers when determining whether a 

proposed export of natural gas is 

consistent with the public interest. The 

D.C. Circuit has upheld DOE’s non-FTA 

export authorizations granted on the 

basis of this public interest evaluation.15

In this rulemaking, DOE has followed 

its established approach in interpreting 

NGA section 3(a) to determine that 

qualifying small-scale natural gas 

exports are consistent with the public 

interest after considering all relevant 

factors (82 FR 41573). There is nothing 

fundamentally unique about small-scale 

exports that would alter DOE’s analysis 

of the public interest in this context. 

4. Domestic Supply of Natural Gas 

Numerous commenters disagreed as 

to whether the United States has 

sufficient natural gas supplies to 

support the expedited approval of 

small-scale exports under this rule. 

Some commenters asserted that the 

United States has sufficient natural gas 

supplies to meet both increased natural 

gas exports and increased domestic 

natural gas demand, as DOE set forth in 

the proposed rule (82 FR 41573–41574). 

Other commenters asserted that the 

United States does not have sufficient 

natural gas supplies to meet current 

demand, much less increased demand 

associated with this rulemaking. One 

commenter, for example, argued that 

approvals for natural gas exports to FTA 

and non-FTA countries combined 

already exceed 71% of domestic 

demand, thereby calling into question 

the sufficiency of U.S. natural gas 

supplies. 

First, DOE notes that the volumes 

authorized for export to FTA and nonFTA countries are not additive to one 

another. The 71% figure cited by the 

commenter for ‘‘combined LNG 

exports’’ fails to acknowledge this fact, 

which is reflected in DOE’s orders. 

Rather, each authorization grants 

authority to export the entire volume of 

a facility to FTA or non-FTA countries, 

respectively, to provide the 

authorization holder with maximal 

flexibility in determining its export 

destinations. 

Next, to date DOE has issued 29 final 

non-FTA authorizations in a cumulative 

volume of exports totaling 21.35 Bcf/d 

of natural gas.16 By comparison, 

approximately 3.5 Bcf/d of capacity has 

been built and is being utilized, and 

approximately 7.5 Bcf/d of additional 

capacity is under construction.17

Industry outlooks, including Reference 

cases in the last several years of EIA’s 

Annual Energy Outlook, do not foresee 

long-term LNG exports from the United 

States exceeding the volume currently 

authorized for export from non-FTA 

countries. 

By DOE’s standard measures of 

supply, there are adequate natural gas 

resources to meet demand associated 

with the final rule. EIA’s most recent 

natural gas estimates of future 

production, price, and other domestic 

industry fundamentals set forth in AEO 

2017 and AEO 2018 support this 

conclusion. For example, the AEO 2017 

Reference case projection of lower-48 

states dry natural gas production in 

2035 increased significantly (by 27.9 

Bcf/d) as compared with AEO 2011, 

while the AEO 2018 Reference case 

projection of that figure was higher still, 

an increase of 33.8 Bcf/d over AEO 

2011. Projections of domestic natural 

gas consumption in 2035 also increased 

in both AEO 2017 and AEO 2018, as 

compared to AEO 2011 (by 11.3 Bcf/d 

in AEO 2017 and by 13.3 Bcf/d in AEO 

2018). Even with higher production and 

consumption, the 2035 projected natural 

gas market price in the Reference case 

declined from $8.04/MMBtu (2017$) in 

AEO 2011 to $5.20/MMBtu (2017$) in 

AEO 2017 and to $4.26/MMBtu (2017$) 

in AEO 2018. The implication of the 

latest EIA projections in AEO 2017 and 

AEO 2018 is that a significantly greater 

quantity of natural gas is projected to be 

available at a lower cost than was 

estimated seven years ago. 


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18U.S. Energy Info. Admin., U.S. Dry Natural Gas 

Proved Reserves (Feb. 12, 2018), available at: http:// 

www.eia.gov/dnav/ng/ng_enr_dry_dcu_nus_a.htm; 

U.S. Energy Info. Admin., U.S. Dry Natural Gas 

Production (Feb. 12, 2018), available at: https:// 

www.eia.gov/dnav/ng/hist/n9070us2a.htm 

(additional calculations conducted to produce 

percentage change and R/P ratios). 

19See U.S. Energy Info. Admin., Assumptions to 

the Annual Energy Outlook 2017 (July 2017), Table 

9.2. Technically recoverable U.S. dry natural gas 

resources as of January 1, 2015, at 133, available at: 

https://www.eia.gov/outlooks/aeo/assumptions/ 

pdf/oilgas.pdf (2017).pdf, and Assumptions to the 

Annual Energy Outlook 2010 (Apr. 2010), Table 9.2. 

Technically recoverable U.S. natural gas resources 

as of January 1, 2008, at 111, available at: http:// 

www.eia.gov/oiaf/aeo/assumption/pdf/ 

0554(2010).pdf. 

20See U.S. Energy Info. Admin., Natural Gas 

Consumption by End Use (Feb. 12, 2018), available 

at: http://www.eia.gov/dnav/ng/ng_cons_sum_dcu_

nus_a.htm. 

21See Eagle LNG Partners Jacksonville II LLC, 

DOE/FE Order No. 4078, at 34–37, supra note 5. 

22U.S. Dep’t of Energy, Office of Fossil Energy, 

Summary of LNG Export Applications of the Lower 

48 States Annual Energy Outlook 2017 (Feb. 14, 

2018), available at: https://energy.gov/fe/ 

downloads/summary-lng-export-applications-lower48-states. 

23The 2015 LNG Export Study included scenarios 

in which LNG exports were unconstrained. These 

scenarios indicated that, should the U.S. resource 

base be less robust and more expensive than 

anticipated, U.S. LNG exports would be less 

competitive in the world market, thereby resulting 

in lower export levels from the United States. 

Further, in all of the unconstrained scenarios, the 

supply and price response to LNG exports did not 

negate the net economic benefit to the economy 

from the exports. 

24See, e.g., Golden Pass Products LLC, DOE/FE 

Order No. 3978, FE Docket No. 12–156–LNG, 

Opinion and Order Granting Long-Term, MultiContract Authorization to Export Liquefied Natural 

Gas by Vessel from the Golden Pass LNG Terminal 

Located in Jefferson County, Texas, to Non-Free 

Trade Agreement, at 148 (Apr. 25, 2017). 

Proved reserves of natural gas—i.e., 

volumes of oil and natural gas that 

geologic and engineering data 

demonstrate with reasonable certainty 

to be recoverable in future years from 

known reservoirs—also have been 

increasing. From 2000 to 2015, proved 

reserves have increased 73% to 307,730 

Bcf, while production has increased 

only 41% during the same period, 

demonstrating the growing supply of 

natural gas available under existing 

economic and operating conditions.18

EIA’s estimates of technically 

recoverable reserves point to the 

availability of domestic natural gas for 

decades to come. These reserves are 

resources in accumulations (both 

proved and unproved) that are 

producible using current recovery 

technology but without reference to 

economic profitability. EIA’s estimates 

of lower-48 natural gas technically 

recoverable reserves total 1,796 Tcf in 

AEO 2017.19

Next, the 2014 and 2015 Studies 

concluded that, for the period of the 

analysis (through 2040), the United 

States is projected to have ample 

supplies of natural gas resources that 

can meet domestic needs for natural gas 

and the LNG export market. Further, 

most projections of domestic natural gas 

resources extend beyond 20 to 40 years. 

Although not all technically recoverable 

resources are currently economical to 

produce, it is instructive to note that 

EIA’s recent estimate of technically 

recoverable resources as of January 1, 

2015, equates to nearly 66 years of 

natural gas supply at the 2015 domestic 

consumption level of 27.24 Tcf.20

Based upon this record evidence and 

the discussion in the proposed rule, 

DOE finds that the small-scale exports 

will not adversely affect the availability 

of natural gas supplies to domestic 

consumers, such as would negate the 

net economic benefits to the United 

States. 

5. Cumulative Impacts 

Several commenters asserted that 

DOE must account for cumulative 

impacts in various ways as part of its 

public interest determination for this 

final rule. Some commenters urged DOE 

to provide a ‘‘cap’’ or other language in 

the final rule to halt automatic approval 

of small-scale exports if the cumulative 

volume of exports exceeds the scope of 

existing cumulative impact analyses 

(which the commenters acknowledge is 

28 Bcf/d of exports based on the 2015 

LNG Export Study, 82 FR 41572), or if 

other circumstances arise that would 

render these exports inconsistent with 

the public interest. Commenters 

suggested, for example, that DOE should 

cease approval of small-scale export 

applications if the United States loses 

its competitive price advantage in 

exporting LNG, or if exporting natural 

gas above a certain volume would have 

negative economic impacts or threaten 

the security of domestic natural gas 

supplies. Other commenters expressed 

concern that U.S. natural gas production 

could not meet ‘‘unlimited’’ LNG 

exports as might occur under the 

proposed rule, and therefore urged DOE 

to implement a ‘‘safety net’’ in the rule 

allowing DOE to halt approvals of smallscale applications. 

DOE declines to adopt a mechanism 

in the final rule that would 

automatically halt approvals of smallscale applications if the cumulative 

volume of approvals exceeds the scope 

of DOE’s cumulative impact analyses to 

date. The 2015 Study considered export 

volumes ranging from 12 to 20 Bcf/d of 

natural gas, as well as a high resource 

recovery case examining export volumes 

up to 28 Bcf/d of natural gas. By 

comparison, to date DOE has issued 

final non-FTA authorizations in a 

cumulative volume of exports totaling 

21.35 Bcf/d of natural gas 21—well 

below the 28 Bcf/d case considered in 

the 2015 Study. DOE already assesses 

the cumulative impacts of each 

succeeding request for export 

authorization on the public interest with 

due regard to the effect on domestic 

natural gas supply and demand 

fundamentals. DOE will continue to do 

so for non-small-scale export 

applications (i.e., applications 

requesting an export volume greater 

than 51.75 Bcf/yr), which constitute 

both 99% of the non-FTA LNG export 

volumes authorized to date and 99% of 

the LNG export volumes requested in 

non-FTA applications currently pending 

before DOE.22

For this final rule, DOE has 

determined that domestic supplies of 

natural gas will be adequate to supply 

small-scale exports of natural gas while 

meeting domestic demand. In so doing, 

DOE considered the economic impacts 

of higher natural gas prices, potential 

increases in natural gas price volatility, 

and the security of domestic natural gas 

supplies, among other factors. DOE also 

explained that the prospect of 

‘‘unlimited’’ exports of U.S. natural gas 

is not realistic, as discussed in the 2015 

LNG Export Study.23 The authors of the 

2015 Study had to include several 

assumptions about the global natural gas 

market for U.S. LNG exports to exceed 

12 Bcf/d, and include far less likely 

assumptions to reach the high resource 

recovery case of 28 Bcf/d of exports. 

Further, as DOE has observed in prior 

orders, receiving a non-FTA 

authorization from DOE does not 

guarantee that a particular facility will 

be financed and built; nor does it 

guarantee that, if built, market 

conditions would continue to favor 

exports once the facility is 

operational.24 For more information on 

DOE’s LNG export studies and DOE’s 

conclusions regarding these public 

interest factors, please see the proposed 

rule (82 FR 41571–41574; Sept. 1, 2017). 

As to the commenter’s concern that 

the global natural gas market for U.S. 

LNG exports could change in the future, 

DOE notes that the 2015 LNG Export 

Study included several assumptions 

about the global market for the time 

period covering 2015 to 2040. 

Nonetheless, DOE’s long-standing 

policy is to minimize federal control 

and involvement in energy markets (82 

FR 41571, 41574), such that even a 

change in the competitive status of U.S. 

LNG globally would not affect DOE’s 


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25U.S. Energy Info. Admin., Effect of Increased 

Levels of Liquefied Natural Gas Exports on U.S. 

Energy Markets (Oct. 2014), available at: https://

www.eia.gov/analysis/requests/fe/pdf/lng.pdf 

[hereinafter 2014 LNG Export Study]; 2015 LNG 

Export Study, supra note 8; see also 82 FR 41571– 

41572 (Sept. 1, 2017). 

26See 2015 LNG Export Study, supra note 8, at 

82. 

27U.S. Envtl. Prot. Agency, Carbon Pollution 

Emission Guidelines for Existing Stationary 

Sources: Electric Utility Generating Units; Final 

Rule, 80 FR 64662 (Oct. 23, 2015). On February 9, 

2016, the U.S. Supreme Court issued a stay of the 

effectiveness of the CPP final rule pending review 

by the U.S. Court of Appeals for the District of 

Columbia Circuit in consolidated cases challenging 

the rule. See Chamber of Commerce, et al. v. EPA, 

et al., No. 15A787, Order in Pending Case (U.S. Feb. 

9, 2016). The litigation over the CPP final rule 

pending in the D.C. Circuit has been held in 

abeyance as the U.S. Environmental Protection 

Agency (EPA) reviews the rule. See West Virginia, 

et al. v. EPA, et al., Case Nos. 15–1363 et al., EPA 

Status Report, at 3 (D.C. Cir. June 1, 2018). On 

October 10, 2017, EPA issued a notice proposing to 

repeal the CPP final rule. U.S. Envtl. Prot. Agency, 

Repeal of Carbon Pollution Emission Guidelines for 

Existing Stationary Sources: Electric Utility 

Generating Units; Proposed Rule, 82 FR 48035 (Oct. 

16, 2017). That rulemaking is on-going, and EPA 

has asked for the consolidated cases to remain in 

abeyance pending the conclusion of the rulemaking. 

See EPA Status Report at 4–5. 

28See 2014 LNG Export Study, supra note 25 

(discussed in the proposed rule at 82 FR 41571– 

41572; Sept. 1, 2017). 

approval of small-scale natural gas 

exports as set forth in this final rule. 

Next, commenters stated that the 

proposed rule is deficient because DOE 

has neither: (i) Attempted to predict the 

potential cumulative size of the U.S. 

small-scale export market, nor (ii) 

identified the potential LNG demand in 

the importing Caribbean, Central 

American, and South American 

countries that are the target of this rule. 

DOE explained in the proposed rule 

that foreign demand for imports of U.S. 

natural gas has increased as many 

countries, such as those in the 

Caribbean, Central America, and South 

America, seek to import cleaner sources 

of energy. Based on the record evidence 

and the small volumes at issue in this 

rulemaking, DOE has determined that 

domestic supplies of natural gas will be 

adequate both to meet domestic needs 

and to supply small-scale exports of 

natural gas (82 FR 41572–41574). We 

therefore disagree with the comment 

that DOE was required to consider 

projections of the potential cumulative 

size of the U.S. small-scale market and/ 

or the market demand of the importing 

regions among the many factors 

evaluated as part of its public interest 

determination. 

6. Economic Impacts 

Several commenters agreed with 

DOE’s position that small-scale natural 

gas exports will not lead to a detectable 

impact on domestic natural gas prices 

(82 FR 41574), whereas other 

commenters disputed this position. The 

dissenting commenters expressed 

concern that this rulemaking will 

increase exports of U.S. natural gas 

(including LNG), leading to increases in 

natural gas prices. They further argued 

that even very small increases in natural 

gas prices are likely to lead to the loss 

of employment in energy-intensive 

industries. In sum, they asserted that, if 

there are any economic or job-creation 

impacts associated with this final rule, 

these impacts are likely to be negative. 

First, as discussed in the proposed 

rule, the 2014 and 2015 LNG Export 

Studies 25 projected the economic 

impacts of LNG exports in a range of 

scenarios, including scenarios that 

exceeded the current amount of LNG 

exports authorized in the final non-FTA 

export authorizations to date. The 2015 

LNG Export Study concluded that LNG 

exports at these levels (in excess of 12 

Bcf/d of natural gas) would result in 

higher U.S. natural gas prices, but that 

these price changes would remain in a 

relatively narrow range across the 

scenarios studied. However, even with 

these estimated price increases, the 

2015 LNG Export Study found that the 

United States would experience net 

economic benefits from increased LNG 

exports in all cases studied.26

Next, for the proposed rule, DOE 

reviewed EIA’s AEO 2017. The 

Reference case of this projection 

includes the effects of the Clean Power 

Plan (CPP) final rule,27 which was 

intended to reduce carbon emissions 

from the power sector. DOE assessed 

AEO 2017 to evaluate any differences 

from AEO 2014, which formed the basis 

for the 2014 LNG Export Study.28

Comparing key results from 2040 (the 

end of the projection period in 

Reference case projections from AEO 

2014) shows that the latest Reference 

case Outlook foresees lower-48 market 

conditions that would be even more 

supportive of LNG exports, including 

higher production and demand coupled 

with notably lower prices. Results from 

EIA’s AEO 2017 no-CPP case, which is 

the same as the Reference case but does 

not include the CPP, are also more 

supportive of LNG exports on the basis 

of higher production with lower prices 

relative to AEO 2014. 

For the year 2040, the AEO 2017 

Reference case anticipates 3% more 

natural gas production in the lower-48 

than AEO 2014. It also projects an 

average Henry Hub natural gas price 

that is lower than AEO 2014 by 38% in 

2017$. In the AEO 2017 no-CPP case, for 

the year 2040, lower-48 production is 

2% higher than in AEO 2014, with the 

price differential being approximately 

the same. Both higher production and 

lower prices in both AEO 2017 cases 

illustrate a market environment 

supportive of LNG exports. 

On February 6, 2018, EIA issued AEO 

2018. For this final rule, DOE has 

considered AEO 2018 to determine 

whether EIA’s most recent projections 

present any material difference in terms 

of price impacts. AEO 2018, which does 

not include the CPP in its Reference 

case, is even more supportive of exports 

than AEO 2017 and AEO 2014, showing 

Henry Hub prices of $4.50 in 2040, 

which is 46% lower than AEO 2014 and 

13% lower than AEO 2017 in 2017$. 

Production levels are also increased in 

2040 in AEO 2018 over AEO 2014 and 

AEO 2017—with AEO 2018 showing 

lower-48 dry production at 109.1 Bcf/d 

over lower-48 production levels of 99.7 

and 102.5 in AEO 2014 and 2017, 

respectively, as shown in the table 

below. 

AEO 2014 

reference 

case 

AEO 2017 

reference 

case 

AEO 2017 

reference 

case without 

clean power 

plan 

AEO 2018 

reference 

case 

Henry Hub Prices in 2040 (in 2017$) .............................................................. $8.27 $5.18 $5.01 $4.50 

Lower-48 Production (Bcf/d) in 2040 ............................................................... 99.7 102.5 101.6 109.1 

In sum, the conclusion of the 2015 

LNG Export Study is that the United 

States will experience net economic 

benefits from issuance of authorizations 

to export domestically produced LNG. 

The 2015 LNG Export Study projected 

that an increase in U.S. natural gas 

exports will generate small declines in 

output at the margin for some energyVerDate Sep<11>2014 16:20 Jul 24, 2018 Jkt 244001 PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 E:\FR\FM\25JYR1.SGM 25JYR1

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29Some commenters criticized the LNG export 

studies commissioned by DOE and cited in the 

proposed rule (82 FR 41571–41572; Sept. 1, 2017), 

including the 2014 and 2015 LNG Export Studies. 

They argued, for example, that these 

macroeconomic studies are flawed in various 

respects and have been refuted by peer-reviewed 

evidence. DOE notes, however, that each of those 

studies was published in the Federal Register. DOE 

received comments on each study—including on 

their models, assumptions, and design—and 

responded to the comments in other proceedings. 

Based upon the record evidence, DOE determined 

that these studies are fundamentally sound. See, 

e.g., Eagle LNG Partners Jacksonville II LLC, DOE/ 

FE Order No. 4078, at 27–28, supra note 5. 

Accordingly, criticisms of DOE’s macroeconomic 

studies are outside the scope of this rulemaking. 

30See Sierra Club v. U.S. Dep’t of Energy, 867 

F.3d 189, 201–02 (D.C. Cir. 2017). 

31U.S. Dep’t of Energy, Addendum to 

Environmental Review Documents Concerning 

Exports of Natural Gas From the United States, 79 

FR 48132 (Aug. 15, 2014), available at: http://

energy.gov/fe/addendum-environmental-reviewdocuments-concerning-exports-natural-gas-unitedstates [hereinafter Addendum]. DOE takes 

administrative notice of the Addendum in this 

proceeding. 

32See, e.g., Golden Pass Products LLC, DOE/FE 

Order No. 3978, supra note 24, at 147–49. 

33See Sierra Club, 867 F.3d at 198–200 

(upholding DOE’s conclusion that, inter alia, there 

was not sufficiently specific information to identify 

where incremental natural gas production would 

occur at the local level); Sierra Club v. U.S. Dep’t 

of Energy, Nos. 16–1186, 16–1252, 16–1253, 703 

Fed. Appx. 1, *2 (D.C. Cir. Nov. 1, 2017) (same). 

intensive, trade-exposed industries, but 

that negative impacts in energyintensive sectors will be offset by 

positive impacts (82 FR 41572; Sept 1, 

2017). 

DOE has reviewed both the evidence 

in the record and relevant precedent, 

and has not found evidence to support 

the commenters’ claims of negative 

economic impact. Nor have those 

commenters presented sufficient 

evidence to support their assertions of 

economic harm.29 On this basis, DOE 

concludes that small-scale natural gas 

exports are expected to generate positive 

economic benefits in the United States 

through direct and indirect job creation, 

increased economic activity, tax 

revenues, and improved U.S. balance of 

trade. 

7. Environmental Issues 

In reviewing the potential 

environmental impacts of the proposed 

rulemaking, DOE has considered both 

its obligations under NEPA (discussed 

in Section II.B.2) and its obligation 

under NGA section 3(a) to ensure that 

the proposal is not inconsistent with the 

public interest. 

In the context of NGA section 3(a), 

several commenters contended that this 

rulemaking is inconsistent with the 

public interest on environmental 

grounds. According to these 

commenters, expediting the approval of 

small-scale natural gas exports will lead 

to increased natural gas production and 

transmission which, in turn, will result 

in negative environmental impacts. 

They cite, for example, the possibility of 

accelerated climate change and 

increased greenhouse gas emissions, 

both in the United States and in the 

importing countries, as a result of these 

increased small-scale exports. These 

commenters contend that, rather than 

facilitating small-scale exports, DOE 

should closely scrutinize or ban natural 

gas exports to non-FTA countries 

altogether. 

As discussed in Section II.B.2 and in 

the proposed rule, qualifying 

applications for small-scale exports 

must not require an environmental 

impact statement (EIS) or an 

environmental assessment (EA) under 

NEPA. That is, the application must be 

eligible for a categorical exclusion. 

Further, DOE has determined—and the 

D.C. Circuit has agreed 30—that NEPA 

does not require consideration of 

induced ‘‘upstream’’ natural gas 

production related to increased natural 

gas production, contrary to the 

commenters’ assertions. 

Specifically, DOE determined that the 

current rapid development of natural 

gas resources in the United States will 

continue, with or without the export of 

natural gas to non-FTA nations. DOE 

also found that fundamental 

uncertainties constrain its ability to 

foresee and analyze with any 

particularity the incremental natural gas 

production that may be induced by 

permitting exports of LNG (or CNG) to 

non-FTA countries—whether from 

unconventional shale gas formations or 

otherwise. Nevertheless, a decision by 

DOE to authorize exports to non-FTA 

countries—including the small-scale 

exports at issue here—could accelerate 

that development by some increment. 

For these reasons, and because DOE 

previously had received comments 

regarding the potential environmental 

impacts associated with unconventional 

production, DOE produced a document 

in 2014 entitled Addendum to 

Environmental Review Documents 

Concerning Exports of Natural Gas from 

the United States (Addendum), and 

made it available for public comment.31

The Addendum takes a broad look at 

unconventional natural gas production 

in the United States, with chapters 

covering water resources (including 

water quantity and quality), air quality, 

greenhouse gas emissions, induced 

seismicity, and land use. 

The Addendum shows that there are 

potential environmental issues 

associated with unconventional natural 

gas production as a whole that need to 

be carefully managed, especially with 

respect to emissions of volatile organic 

compounds and methane, and the 

potential for groundwater 

contamination. These environmental 

concerns do not lead DOE to conclude, 

however, that the proposed small-scale 

exports of natural gas are not in the 

public interest and/or should be 

prohibited. Rather, DOE believes the 

public interest is better served by 

addressing these concerns directly— 

through federal, state, or local 

regulation, or through self-imposed 

industry guidelines where appropriate— 

rather than by prohibiting exports of 

natural gas. Unlike DOE, environmental 

regulators have the legal authority to 

impose requirements on natural gas 

production that appropriately balance 

benefits and burdens, and to update 

these regulations from time to time as 

technological practices and scientific 

understanding evolve. Declining to 

approve (or to expedite) small-scale 

natural gas exports would cause the 

United States to forego the economic 

and international benefits discussed 

herein, but would have little more than 

a small, incremental impact on the 

environmental issues identified by these 

commenters. This is particularly true 

because—as the Addendum illustrates— 

DOE is unable to predict at a local level 

where any additional natural gas 

production would occur and in what 

quantity to support the small-scale 

exports.32 For these reasons, we 

conclude that the environmental 

concerns associated with natural gas 

production do not establish that the 

small-scale exports at issue in this 

rulemaking are inconsistent with the 

public interest. We also note that DOE’s 

legal analysis in this regard has been 

upheld by the D.C. Circuit in the context 

of four different non-FTA authorizations 

together approving far more significant 

volumes of U.S. LNG for export.33

Next, one commenter questioned 

whether small-scale exports will, in fact, 

facilitate the transition of importing 

countries away from the use of diesel 

and fuel oil, and argued that DOE has 

not provided sufficient evidence of this 

displacement to justify the final rule. 

We emphasize that foreign demand for 

U.S. natural gas has increased as 

countries in the Caribbean, Central 

America, and South America seek to 

import cleaner sources of energy. DOE 

further observes that many of these 

countries are currently dependent on 

diesel and/or fuel oil for their 

generation needs. These energy needs 

are challenging from both a cost- and 

emissions-perspective. By importing 


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34 15 U.S.C. 717b(a). 

35 5 U.S.C. 554. 

36NGA section 19(b) states that ‘‘[a]ny party to a 

proceeding under this chapter aggrieved by an order 

issued by the Commission in such proceeding may 

obtain a review of such order in the court of appeals 

of the United States for any circuit wherein the 

natural-gas company to which the order relates is 

located or has its principal place of business, or in 

the United States Court of Appeals for the District 

of Columbia . . . . [S]uch court shall have 

jurisdiction, which upon the filing of the record 

with it shall be exclusive, to affirm, modify, or set 

aside such order in whole or in part.’’ 15 U.S.C. 

717r(b). 

37See, e.g., Sierra Club, 867 F.3d at 202 (citing 

15 U.S.C. 717r(b)). 

LNG from the United States, these 

countries will have access to a more 

reliable, cost-effective supply of energy 

that also has emissions benefits over 

current energy sources. Small-scale 

natural gas exports will fulfill an 

important need for natural gas in 

importing countries that often lack the 

customer demand, waterway 

infrastructure, and transmission 

infrastructure necessary to handle large 

quantities of natural gas and large LNG 

carriers. 

Additionally, increased diversity of 

fuel supplies and sources used for 

generating electricity are expected to 

make these importing countries more, 

not less, resilient against energy outages 

after hurricanes, earthquakes, and other 

natural disasters. At the same time, the 

United States will facilitate stronger 

relationships with these importing 

countries, while promoting U.S. 

leadership in the global energy market. 

In sum, the commenter’s argument as to 

DOE’s lack of ‘‘evidence’’ of this 

expected transition to U.S. natural gas 

misconceives DOE’s public interest 

analysis and seeks to impose a burden 

of proof where none exists, although 

DOE anticipates numerous 

environmental benefits to the importing 

countries from this rulemaking. 

Finally, some commenters argued that 

DOE should be focused on encouraging 

renewable sources of energy, rather than 

facilitating exports of natural gas 

through this rulemaking. They asserted 

that renewable sources of energy are 

more environmentally friendly than 

natural gas, whereas (in their view) the 

proposed exports of natural gas are not 

in the public interest. DOE notes, 

however, that imports of U.S. LNG can 

work in concert with the development 

of renewable generation in importing 

countries. Imported natural gas can 

provide reliable standby energy supply 

available immediately, while renewable 

development is occurring. Imported 

LNG also can provide continued 

reliability to enhance solar or other 

renewable sources once they are 

developed. For these reasons, smallscale natural gas exports approved 

under this rule may provide indirect 

benefits to the use of renewable energy 

in importing countries. 

8. Administrative Procedures and 

Judicial Review Under the Natural Gas 

Act 

Some commenters argued that DOE 

cannot, in interpreting the phrase ‘‘in 

the public interest’’ in NGA section 3(a), 

remove public notice and comment 

procedures for individual small-scale 

export applications. According to these 

commenters, the phrase ‘‘opportunity 

for hearing’’ in NGA section 3(a) means 

that members of the public must be 

afforded the opportunity to present 

evidence to DOE regarding each nonFTA export application on a case-bycase basis. These commenters expressed 

concern that the proposed rule would 

frustrate the design of the NGA by 

eliminating the opportunity for public 

comment on individual small-scale 

applications. 

Some commenters also asserted that 

the final rule is inconsistent with the 

NGA’s judicial review provisions set 

forth in NGA section 19 (15 U.S.C. 717r) 

and the implementing regulation (10 

CFR 590.501(a)). They argued that these 

judicial review provisions are available 

only to a ‘‘party’’ to a proceeding, yet 

under the proposed rule, there would be 

no clear way for a member of the public 

to intervene in an individual small-scale 

application proceeding and become a 

party to that proceeding. In their view, 

absent the availability of this remedy, 

judicial review would be provided by 

the Administrative Procedure Act (APA) 

(5 U.S.C. 704) and thus lie in the district 

courts—creating tension with the NGA’s 

intent to provide for direct review in the 

federal courts of appeals under NGA 

section 19(b). 

As to the administrative concerns, we 

note that under NGA section 3(a), the 

Secretary of Energy ‘‘shall’’ issue an 

order upon application unless, after 

‘‘opportunity for hearing,’’ DOE finds 

that the proposed export will not be 

consistent with the public interest.34

Section 3(a) does not require 

adjudication of applications to be 

determined ‘‘on the record after 

opportunity for a hearing’’ under the 

APA.35 That type of statutory language 

imposes the need for a formal 

adjudication under the APA. Section 

3(a) also does not require the individual 

adjudication of each application. The 

statutory language in NGA section 

3(a)—‘‘opportunity for hearing’’—allows 

DOE to conduct an informal (rather than 

a formal) adjudication and affords DOE 

broad discretion to determine that the 

notice and public comment period on 

the proposed rule constitutes the notice 

and opportunity for comment on all 

prospective small-scale natural gas 

export applications. In this proceeding, 

DOE sought public comment on the 

proposed rule for a 45-day period and 

received comments from a variety of 

stakeholders and interested persons. 

DOE has reviewed the comments and 

taken them into consideration in this 

final rule. Therefore, DOE disagrees that 

expediting the review and approval 

process for qualifying small-scale 

natural gas applications under 10 CFR 

590.208(a) would frustrate the design of 

NGA section 3(a). Rather, DOE believes 

it is has provided sufficient process 

under the APA to determine that all 

prospective small-scale natural gas 

export applications—if meeting the 

qualifying criteria—are in the public 

interest. 

As to the judicial review comments, 

to the extent that small-scale export 

authorizations are reviewable, NGA 

section 19(b) vests exclusive jurisdiction 

in the appropriate federal court of 

appeals.36 A federal district court thus 

would lack jurisdiction over the 

dispute.37

B. Regulatory Criteria 

In the final rule, DOE establishes a 

regulatory definition for ‘‘small-scale 

natural gas export,’’ to be codified at 10 

CFR 590.102(p). Under this provision, a 

small-scale natural gas export is any 

export of natural gas to non-FTA 

nations, provided that the application 

for the export authority satisfies both 

the volume and NEPA criteria identified 

in 10 CFR 590.102(p)(1) and (2). 

1. Volume Limitation 

10 CFR 590.102(p)(1) establishes the 

volume limitation for small-scale 

natural gas exports. Under this criterion, 

a qualifying application must propose to 

export natural gas in a volume up to and 

including 51.75 Bcf/yr—an annualized 

figure that corresponds to the 0.14 Bcf/ 

d volume criterion proposed by DOE. In 

the proposed rule, DOE stated that this 

volume criterion is consistent with 

industry practice for the emerging 

small-scale export market, but invited 

comment on any other appropriate 

volume limitation (82 FR 41573; Sept. 1, 

2017). 

Some commenters generally disagreed 

with this volume criterion, asserting 

that exports up to and including 0.14 

Bcf/d (51.75 Bcf/yr) are substantial and 

cannot reasonably be considered ‘‘small 

scale.’’ These commenters, however, 

neither presented evidence supporting 

their claims in the context of small-scale 

natural gas exports nor suggested a 


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38See Eagle LNG Partners Jacksonville II LLC, 

DOE/FE Order No. 4078, supra note 5, at 34–37 

(identifying DOE’s 29 final non-FTA authorizations 

for LNG and CNG issued to date). 

39See, e.g., 10 CFR 590.202(b)(1) (requiring 

applicants to identify the facilities to be utilized or 

constructed for the proposed export). 

40See, e.g., Dominion Cove Point LNG, LP, DOE/ 

FE Order No. 3331–A, FE Docket No. 11–128–LNG, 

Final Opinion and Order Granting Long-Term, 

Multi-Contract Authorization to Export Liquefied 

Natural Gas from the Cove Point LNG Terminal in 

Calvert County, Maryland, to Non-Free Trade 

Agreement Nations, at 1–2 (May 7, 2015); see also 

Eagle LNG Partners Jacksonville II LLC, DOE/FE 

Order No. 4078, supra note 5, at 37. 

41 33 U.S.C. 1501, et seq. 

different volume limitation they believe 

to be more appropriate. As explained in 

the proposed rule, DOE based the 

volume criterion on industry standards 

that define ‘‘small-scale LNG’’ as 1.0 

million metric tons per annum (mtpa) or 

lower (82 FR 41573 note 21). Using 

DOE’s conversion factor to convert mtpa 

of LNG to Bcf of natural gas (82 FR 

41573), this amount equates to a volume 

of 0.14 Bcf/d, or 51.75 Bcf/yr, of natural 

gas. On this basis, DOE believes that it 

is reasonable to define small-scale 

natural gas exports as any export of 

natural gas up to and including a 

volume of 51.75 Bcf/yr. 

One commenter expressed concern 

that the volume criterion is too large for 

a single project. This commenter 

pointed out that, of DOE’s seven nonFTA export authorizations identified in 

the proposed rule as falling under this 

volume threshold (82 FR 41572), the 

volumes authorized in those orders 

were, in fact, smaller than 0.14 Bcf/d 

even if all of the volumes are combined. 

Specifically, the commenter states that 

the proposed volume criterion is 

approximately 25% larger than the 

combined total of those seven 

authorizations—0.14 Bcf/d for a single 

project, as opposed to a combined 0.112 

Bcf/d for the seven authorizations 

identified in the proposed rule. 

The seven authorizations identified in 

the proposed rule were not intended to 

suggest a limiting parameter for this 

rulemaking. Rather, they provide 

context in showing small-scale LNG 

export authorizations previously issued 

by DOE—particularly as compared to 

the large-scale LNG export 

authorizations issued by DOE in 

volumes up to and exceeding 2.0 Bcf/d 

of natural gas for a single project.38 As 

discussed above, DOE proposed the 

volume criterion for this rulemaking 

based on industry sources that mark the 

boundary between large-scale and 

small-scale exports at 1 mtpa (82 FR 

41573 note 21)—equivalent to the 51.75 

Bcf/yr volume criterion in this final 

rule. DOE sees no basis to depart from 

this volume limitation on the basis of 

the information presented in the 

comments. 

The same commenter argued that the 

proposed rule is overbroad insofar as it 

may apply in export circumstances 

beyond those identified by DOE as 

justifying the rule. The commenter 

therefore urged DOE to expand the 

mandatory criteria for small-scale 

exports to include specific export 

characteristics beyond the volume 

criterion—such as the exporter’s use of 

ISO containers or other non-traditional 

transport, destination countries in 

specific regions, and evidence that the 

exports will displace diesel or fuel oil 

in the importing markets. DOE has 

considered this proposal but sees no 

reason to unnecessarily confine the 

development of the small-scale export 

market by adding criteria that are, in 

fact, already market-driven. 

As explained in the proposed rule, 

many of the countries in the Caribbean, 

Central America, and South America do 

not generate enough demand to import 

the large volumes of natural gas 

supplied by the large-scale natural gas 

import/export market. Given these 

diseconomies of scale, a gap has 

emerged in the regional natural gas 

import/export market, and small-scale 

natural gas exports represent a marketdriven response to fill this gap. Because 

the small-scale market already reflects 

the specific characteristics identified by 

the commenter, imposing these 

characteristics as additional mandatory 

criteria is unlikely to benefit the public 

interest or otherwise enhance the 

objectives or implementation of this 

final rule. Further, imposing such 

criteria would be at odds with DOE’s 

long-standing practice of minimizing 

regulatory impediments to a freely 

operating market and promoting market 

competition (82 FR 41571, 41574; Sept. 

1, 2017). DOE has concluded that the 

volume criterion, in addition to the 

NEPA criterion discussed below, is 

sufficient in defining and regulating the 

small-scale export market. 

Commenters asked DOE whether the 

proposed rule would allow exporters to 

submit multiple applications, each 

below the 0.14 Bcf/d (51.75 Bcf/yr) 

volume limitation, as a way to expand 

the authorized export volumes for their 

facilities without triggering the 

jurisdiction of FERC or the U.S. 

Maritime Administration (MARAD) 

under NEPA. These types of 

applications—commonly referred to as 

‘‘design increases’’ or expansions— 

typically arise from the improved 

engineering of proposed or existing LNG 

facilities that allows for additional LNG 

production without new construction. 

Some commenters asked DOE to add 

language to the final rule that would 

expressly allow this practice, so as to 

encourage investment in and innovation 

at LNG export facilities. Other 

commenters suggested that this practice, 

if allowed, would effectively change the 

nature of this rule by encouraging 

‘‘segmentation’’ of additional export 

volumes at large-scale facilities, as 

opposed to the intended small-scale 

facilities. 

DOE declines to add the requested 

language to this final rule. DOE 

emphasizes that the final rule is 

intended to facilitate small-scale exports 

of natural gas for the reasons discussed 

herein. This rule does not preclude 

applicants from applying for more than 

one authorization for small-scale natural 

gas exports. Such flexibility may be 

useful, for example, for authorization 

holders seeking to export small-scale 

volumes from different facilities. DOE, 

however, will not accept requests by 

authorization holders seeking to 

combine more than one small-scale 

export authorization as an indirect 

means of expanding the DOE-approved 

export volume from their facility, 

including from large-scale facilities. 

Further, DOE notes that, in the nonFTA export authorizations issued to 

date, DOE has approved an applicant’s 

export volume from a specific facility 

(or facilities), based on the approved 

production (or export) capacity of that 

facility.39 Likewise, approved export 

volumes for a particular facility under 

this rule may not, on their own or added 

together, exceed the maximum 

approved production (or export) 

capacity of that facility.40 Finally, 

nothing in this final rule affects the 

authorities exercised by FERC under the 

NGA or by MARAD under the 

Deepwater Port Act.41

2. Categorical Exclusion From NEPA 

10 CFR 590.102(p)(2) establishes the 

NEPA criterion for small-scale natural 

gas exports. As the second criterion for 

this final rule, DOE’s approval of the 

application must not require an EIS or 

EA under NEPA—that is, the 

application must be eligible for a 

categorical exclusion under DOE’s 

NEPA regulations. 

As explained in the proposed rule, 

DOE’s environmental review process 

under NEPA usually results in the 

preparation or adoption of an EIS or EA 

describing the potential environmental 

impacts associated with the application. 

In some cases, DOE may determine that 

an application is eligible for a 

categorical exclusion pursuant to DOE’s 


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42This categorical exclusion states in full: ‘‘B5.7 

Import or export natural gas, with operational 

changes: Approvals or disapprovals of new 

authorizations or amendments of existing 

authorizations to import or export natural gas under 

section 3 of the Natural Gas Act that involve minor 

operational changes (such as changes in natural gas 

throughput, transportation, and storage operations) 

but not new construction.’’ 10 CFR part 1021, 

subpart D, appendix B5.7. 

43Carib Energy (USA) LLC (FE Docket No. 11– 

141–LNG), 0.04 Bcf/d; American LNG Marketing 

LLC (FE Docket No. 14–209–LNG), 0.008 Bcf/d; 

Floridian Natural Gas Storage Company, LLC (FE 

Docket No. 15–38–LNG); Air Flow North American 

Corp. (FE Docket No. 15–206–LNG, 0.002 Bcf/d; 

Flint Hills Resources, LP (FE Docket No. 15–168– 

LNG, 0.01 Bcf/d; Carib Energy (USA), LLC (FE 

Docket No. 16–98–LNG), 0.004 Bcf/d; and Eagle 

LNG Partners Jacksonville II LLC (FE Docket No. 

17–79–LNG), 0.01 Bcf/d. The Carib and Floridian 

orders are both 0.04 Bcf/d, yet are not additive to 

one another because the source of LNG approved 

under both orders is from the Floridian Facility. 

44 40 CFR 1508.4. 

45 10 CFR 1021.410(b)(2). 

46 Id. 

47See U.S. Dep’t of Energy, Office of NEPA Policy 

and Compliance, Categorical Exclusion (CX) 

Determinations, available at: https://energy.gov/ 

nepa/categorical-exclusion-cx-determinations. 

48See, e.g., Eagle LNG Partners Jacksonville II 

LLC, DOE/FE Order No. 4078, supra note 5, at 46. 

49 In the context of NEPA, many commenters 

discussed the environmental and health risks that, 

in their view, are associated with the siting and 

operation of LNG export facilities and related 

transportation infrastructure near their home or 

community. They asserted, for example, that they 

will suffer from any accidents at nearby LNG export 

facilities and pipelines, or explosions of ISO 

containers loaded onto trains or trucks. They 

expressed concern that such accidents could result 

in harm to air, water, and other natural resources. 

They also assert that natural disasters, such as 

hurricanes and wildfires, in the vicinity of LNG 

export facilities and infrastructure can threaten 

public safety. DOE notes that these concerns 

generally involve the siting of natural gas-related 

infrastructure. These concerns are outside the scope 

of this rulemaking, which is based on existing 

facilities subject to a categorical exclusion under 

NEPA. Nonetheless, as stated above, DOE requires 

all authorization holders to comply with any 

preventative and mitigative measures at natural gas 

import and export facilities imposed by federal, 

state, and/or local agencies. 

regulations implementing NEPA, 10 

CFR 1021.410, appendices A & B. The 

categorical exclusion most commonly 

used in this context is categorical 

exclusion B5.7 (10 CFR part 1021, 

subpart D, appendix B5.7), which 

applies to natural gas import or export 

activities requiring minor operational 

changes to existing projects, but no new 

construction.42

This NEPA criterion is very 

conservative. Based on DOE’s 

experience, this criterion will limit 

application of this final rule to a small 

subset of all export applications. For 

example, of the 29 final non-FTA export 

authorizations for LNG (and CNG) 

issued as of the date of this final rule, 

only seven would meet both the volume 

and NEPA criteria to qualify as smallscale natural gas exports.43 Together, 

these seven authorizations approve 

exports in a combined volume of 0.074 

Bcf/d—representing only 0.35% of the 

cumulative volume of non-FTA exports 

approved to date (21.35 Bcf/d of natural 

gas). 

Nonetheless, some of the comments 

on the proposed rule reflected 

widespread confusion about the 

meaning and applicability of a 

categorical exclusion under NEPA. 

Several commenters expressed concern 

that this criterion will result in smallscale natural gas exports that have no 

environmental protections or oversight 

because they are not subject to an EIS 

or EA under NEPA. These commenters 

asserted that an EA or EIS must be 

prepared in every instance to consider 

a variety of perceived risks to the 

environment, public safety, and public 

health posed by natural gas exports. In 

their view, an export application 

approved by DOE on the basis of a 

categorical exclusion under NEPA will 

lead to ‘‘unregulated’’ natural gas export 

facilities and infrastructure. 

DOE emphasizes that its 

determination that a particular 

application qualifies for a DOE 

categorical exclusion is the result of a 

thorough NEPA assessment process. A 

categorical exclusion does not 

circumvent or ‘‘relax’’ the NEPA review 

process (as some commenters suggest) 

but, in fact, is a means to comply with 

NEPA. Indeed, categorical exclusions 

facilitate NEPA by allowing federal 

agencies to focus their environmental 

review and resources on actions that 

could have significant impacts. The 

Council on Environmental Quality’s 

NEPA regulations provide for 

categorical exclusions when an agency 

has identified a ‘‘category of actions 

which do not individually or 

cumulatively have a significant effect on 

the human environment and which 

have been found to have no such effect 

in procedures adopted by a federal 

agency. . .’’ 44 DOE has made such a 

determination with respect to 

categorical exclusion B5.7, Import or 

Export of Natural Gas, with Operational 

Changes. Accordingly, there is no basis 

to conclude that qualifying small-scale 

exports would originate from 

‘‘unregulated’’ LNG export facilities 

lacking sufficient oversight of potential 

risks to the environment, public safety, 

and public health. 

In determining that an export 

application is eligible for a categorical 

exclusion under DOE’s NEPA 

regulations, DOE must not only 

determine that the application fits 

within a specific categorical exclusion, 

but it must also determine that ‘‘there 

are no extraordinary circumstances 

related to the proposal that may affect 

the significance of the environmental 

effects of the proposal.’’ 45 For 

qualifying small-scale natural gas export 

applications, DOE will satisfy this 

requirement by conducting an 

assessment of appropriate 

environmental-related documents to 

determine whether there are 

‘‘extraordinary circumstances’’ 

associated with the proposed exports. 

This review includes consideration of 

potential impacts to property of historic, 

archeological, or architectural 

significance; federally-listed threatened 

or endangered species and their habitat; 

and wetlands regulated under the Clean 

Water Act.46 To ensure transparency, all 

categorical exclusions used by DOE to 

comply with NEPA are made publicly 

available on DOE’s NEPA website.47

DOE will follow the same practice for 

qualifying small-scale natural gas export 

applications. 

Finally, regardless of whether DOE 

determines that an application is subject 

to an EIS, an EA, or is eligible for a 

categorical exclusion under NEPA, DOE 

expressly conditions all of its non-FTA 

authorizations on the authorization 

holder’s ongoing compliance with all 

preventative and mitigative measures at 

the facility imposed by federal, state, 

and/or local agencies.48 Small-scale 

natural gas exports will be subject to the 

same conditions and oversight.49

For these reasons, DOE does not agree 

that this criterion of this rule—whereby 

an application must be eligible for a 

categorical exclusion under NEPA—will 

lead to natural gas exports lacking in 

environmental protection and/or to 

unregulated LNG export facilities. DOE 

is committed to a thorough NEPA 

assessment process and, accordingly, 

DOE is not changing this criterion in the 

final rule. 

C. Other Issues 

Below, DOE addresses a variety of 

other comments on the proposed rule. 

To the extent commenters have urged 

DOE to take some different type of 

action with respect to natural gas 

exports, DOE notes that it may consider 

additional measures under section 3(a) 

of the Natural Gas Act as part of its 

regulatory reform efforts and welcomes 

suggestions, data, and information on 

this topic through its regulatory reform 

email inbox at Regulatory.Review@

hq.doe.gov. 

One commenter asserted that this 

rulemaking is arbitrary and capricious 

because it lacks substantive analysis and 

viable alternatives. Under the APA, an 


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50See, e.g., 5 U.S.C. 706; Motor Vehicle Mfr. Ass’n 

v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 

(1983). 

51See 44 U.S.C. 1508 (notice sufficient when 

published in the Federal Register). 

52 10 CFR part 1021, subpart D, appendix A6. 

agency decision is arbitrary and 

capricious only if the agency’s decision 

is not based on a consideration of the 

relevant factors and where there is a 

clear error of judgment by the agency.50

As explained above and in the proposed 

rule, DOE has determined that smallscale natural gas exports are consistent 

with the public interest after 

considering its obligations under NGA 

section 3(a), the public comments 

received on the proposed rule, and a 

wide range of information bearing on 

the public interest (82 FR 41573–41574; 

Sept. 1, 2017). Additionally, DOE has 

considered its 29 final non-FTA export 

authorizations issued to date, as well 

EIA’s authoritative projections for 

natural gas supply, demand, and prices 

set forth in both the AEO 2017 and AEO 

2018. DOE has thoroughly analyzed the 

many factors affecting the export of U.S. 

natural gas, as well as the unique 

characteristics and minimal adverse 

impacts of the emerging small-scale 

natural gas market. On this basis, DOE 

has determined that this rule is 

consistent with both NGA section 3(a) 

and DOE’s established practice in 

authorizing such exports. 

One commenter characterized this 

rulemaking as imposing redundant, 

burdensome administrative 

requirements and compliance costs, but 

did not specify the basis for that claim. 

DOE emphasizes that it is not imposing 

any administrative requirements or 

compliance costs through this 

rulemaking. To the contrary, as 

explained in the proposed rule (82 FR 

41570), the regulation promulgated in 

this final rule is intended to expedite 

DOE’s processing of small-scale 

applications, thereby reducing 

administrative burdens and costs for the 

small-scale natural gas market. 

On the other hand, another 

commenter asserted that this 

rulemaking is not deregulatory because 

it creates a new regulation to define 

small-scale natural gas exports 

according to specified criteria. This 

commenter claimed that DOE is limiting 

its ability to adapt to market changes, 

should the parameters of the small-scale 

natural gas market change. As stated 

above, however, this rulemaking 

qualifies as a deregulatory action 

because DOE is reducing or eliminating 

administrative requirements and 

compliance costs for the small-scale 

export market under NGA section 3(a). 

DOE is satisfied that the criteria for this 

rulemaking, which are based in part on 

industry practice, are appropriate for 

this developing market. Nonetheless, 

should unforeseeable changes in the 

small-scale export market require DOE 

to amend this regulation, DOE retains 

the regulatory authority to do so. 

One commenter asserted that the 45- 

day public comment period for the 

proposed rule should be extended 

because the link for submitting 

comments on the Federal eRulemaking 

Portal was not working when the 

commenter attempted to submit 

comments. In the proposed rule, DOE 

identified a variety of methods that 

could be used to submit comments, 

including email (82 FR 41570; Sept. 1, 

2017). DOE also notes that no other 

commenter raised this issue and many 

commenters submitted comments 

through the Federal eRulemaking Portal. 

DOE therefore declines to extend or reopen the public comment period in this 

rulemaking. 

One commenter argued that DOE 

failed to provide sufficient notice of this 

rule in local media outlets, print media, 

and online publications. As a matter of 

law, however, DOE provided sufficient 

notice of this rulemaking by publishing 

it in the Federal Register.51

Finally, separate from the NEPA 

regulatory criterion for small-scale 

natural gas exports, several commenters 

disagreed with DOE’s application of 

categorical exclusion A6 under NEPA 

for this rulemaking itself, as discussed 

in the ‘‘Regulatory Review’’ portion of 

the proposed rule (82 FR 41575, 

‘‘National Environmental Policy Act’’) 

and set forth below. In the proposed 

rule, DOE explained that neither an EIS 

nor an EA was required to support this 

rulemaking. These commenters 

disagreed with that assessment, 

asserting that DOE violated NEPA by 

not preparing an EIS or an EA that 

addressed all potential environmental 

impacts associated with this rulemaking 

and that considered reasonable 

alternatives to the proposed rule. 

As explained in the proposed rule (as 

well as in this final rule), DOE has 

determined that this regulation ‘‘fall[s] 

into a class of actions that does not 

individually or cumulatively have a 

significant impact on the human 

environment as set forth under DOE’s 

regulations implementing [NEPA]’’ (82 

FR 41575). Specifically, DOE has 

determined that this rulemaking falls 

under categorical exclusion A6 (10 CFR 

part 1021, subpart D, appendix A6). 

Categorical exclusion A6 applies to 

‘‘rulemakings that are strictly 

procedural.’’ 52 This rulemaking is 

strictly procedural because it establishes 

expedited procedures applicable to 

qualifying small-scale natural gas export 

applications. Currently, DOE makes a 

public interest determination for all 

applications to export natural gas to 

non-FTA countries under NGA section 

3(a), regardless of the proposed export 

volume. In making this determination, 

DOE imposes certain procedural 

requirements, which in turn lead to 

longer processing time for applications 

to export natural gas to non-FTA 

countries. This rulemaking expedites 

DOE’s administrative processing for 

qualifying small-scale natural gas export 

applications by eliminating the notice of 

application and other procedures 

typically required under DOE’s 

regulations (82 FR 41573). For these 

reasons, DOE has determined that 

categorical exclusion A6 applies to this 

rulemaking. 

III. Regulatory Review 

A. Executive Orders 12866 and 13563 

This regulatory action has been 

determined to be an ‘‘economically 

significant regulatory action’’ under 

Executive Order 12866, ‘‘Regulatory 

Planning and Review,’’ 58 FR 51735 

(October 4, 1993). Accordingly, this 

action was subject to review under that 

Executive Order by the Office of 

Information and Regulatory Affairs of 

the Office of Management and Budget. 

DOE has also reviewed this regulation 

pursuant to Executive Order 13563, 

issued on January 18, 2011. (76 FR 3281, 

Jan. 21, 2011.) E.O. 13563 is 

supplemental to and explicitly reaffirms 

the principles, structures, and 

definitions governing regulatory review 

established in Executive Order 12866. 

To the extent permitted by law, agencies 

are required by Executive Order 13563 

to: (1) Propose or adopt a regulation 

only upon a reasoned determination 

that its benefits justify its costs 

(recognizing that some benefits and 

costs are difficult to quantify); (2) tailor 

regulations to impose the least burden 

on society, consistent with obtaining 

regulatory objectives, taking into 

account, among other things, and to the 

extent practicable, the costs of 

cumulative regulations; (3) select, in 

choosing among alternative regulatory 

approaches, those approaches that 

maximize net benefits (including 

potential economic, environmental, 

public health and safety, and other 

advantages; distributive impacts; and 

equity); (4) to the extent feasible, specify 

performance objectives, rather than 

specifying the behavior or manner of 

compliance that regulated entities must 

adopt; and (5) identify and assess 


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available alternatives to direct 

regulation, including providing 

economic incentives to encourage the 

desired behavior, such as user fees or 

marketable permits, or providing 

information upon which choices can be 

made by the public. 

DOE concludes that this final rule is 

consistent with these principles. 

Specifically, this final rule provides that 

DOE will issue an export authorization 

upon receipt of any complete 

application that seeks to export natural 

gas, including LNG, to non-FTA 

countries, provided that the application 

satisfies the following two criteria: (1) 

The application proposes to export 

natural gas in a volume up to and 

including 51.75 Bcf/yr, and (2) DOE’s 

approval of the application does not 

require an EIS or EA under NEPA. 

DOE’s regulations regarding notice of 

applications, 10 CFR 590.205, and 

procedures applicable to application 

proceedings, 10 CFR part 590, subpart C 

(10 CFR 590.303 to 10 CFR 590.317), do 

not apply to small-scale natural gas 

exports. The final rule is intended to 

expedite DOE’s processing of these 

applications, thereby reducing 

administrative burdens for the smallscale natural gas export market. 

B. Executive Orders 13771, 13777, and 

13783 

On January 30, 2017, the President 

issued Executive Order 13771, 

‘‘Reducing Regulation and Controlling 

Regulatory Costs.’’ That Order stated the 

policy of the executive branch is to be 

prudent and financially responsible in 

the expenditure of funds, from both 

public and private sources. The Order 

stated it is essential to manage the costs 

associated with the governmental 

imposition of private expenditures 

required to comply with Federal 

regulations. This final rule is expected 

to be an E.O. 13771 deregulatory action. 

Additionally, on February 24, 2017, 

the President issued Executive Order 

13777, ‘‘Enforcing the Regulatory 

Reform Agenda.’’ The Order required 

the head of each agency designate an 

agency official as its Regulatory Reform 

Officer (RRO). Each RRO oversees the 

implementation of regulatory reform 

initiatives and policies to ensure that 

agencies effectively carry out regulatory 

reforms, consistent with applicable law. 

Further, E.O. 13777 requires the 

establishment of a regulatory task force 

at each agency. The regulatory task force 

is required to make recommendations to 

the agency head regarding the repeal, 

replacement, or modification of existing 

regulations, consistent with applicable 

law. At a minimum, each regulatory 

reform task force must attempt to 

identify regulations that: 

(i) Eliminate jobs, or inhibit job 

creation; 

(ii) Are outdated, unnecessary, or 

ineffective; 

(iii) Impose costs that exceed benefits; 

(iv) Create a serious inconsistency or 

otherwise interfere with regulatory 

reform initiatives and policies; 

(v) Are inconsistent with the 

requirements of Information Quality 

Act, or the guidance issued pursuant to 

that Act, in particular those regulations 

that rely in whole or in part on data, 

information, or methods that are not 

publicly available or that are 

insufficiently transparent to meet the 

standard for reproducibility; or 

(vi) Derive from or implement 

Executive Orders or other Presidential 

directives that have been subsequently 

rescinded or substantially modified. 

Finally, on March 28, 2017, the 

President signed Executive Order 13783, 

entitled ‘‘Promoting Energy 

Independence and Economic Growth.’’ 

Among other things, E.O. 13783 requires 

the heads of agencies to review all 

existing regulations, orders, guidance 

documents, policies, and any other 

similar agency actions (collectively, 

agency actions) that potentially burden 

the development or use of domestically 

produced energy resources, with 

particular attention to oil, natural gas, 

coal, and nuclear energy resources. 

Such review does not include agency 

actions that are mandated by law, 

necessary for the public interest, and 

consistent with the policy set forth 

elsewhere in that order. 

Executive Order 13783 defined 

burden for purposes of the review of 

existing regulations to mean to 

unnecessarily obstruct, delay, curtail, or 

otherwise impose significant costs on 

the siting, permitting, production, 

utilization, transmission, or delivery of 

energy resources. 

DOE concludes that this final rule is 

consistent with the directives set forth 

in these executive orders. Specifically, 

this final rule is a deregulatory action 

that requires DOE to issue an export 

authorization upon receipt of any 

complete application that seeks to 

export natural gas, including LNG, to 

non-FTA countries, provided that the 

application satisfies the following two 

criteria: (1) The application proposes to 

export natural gas in a volume up to and 

including 51.75 Bcf/yr, and (2) DOE’s 

approval of the application does not 

require an EIS or an EA under NEPA. 

Applications that satisfy these criteria 

are requesting authorization for ‘‘smallscale natural gas exports’’ and, as such, 

the exports are deemed to be consistent 

with the public interest under NGA 

section 3(a). DOE’s regulations regarding 

notice of applications and procedures 

conducted on applications do not apply 

to applications that satisfy these criteria. 

The final rule will expedite DOE’s 

processing of these applications, thereby 

reducing administrative burdens for the 

small-scale natural gas export market. 

C. National Environmental Policy Act 

DOE has determined that adoption of 

this final rule falls into a class of actions 

that does not individually or 

cumulatively have a significant impact 

on the human environment as set forth 

under DOE’s regulations implementing 

the National Environmental Policy Act 

of 1969 (42 U.S.C. 4321 et seq). 

Specifically, this rulemaking is covered 

under the categorical exclusion found in 

the DOE’s National Environmental 

Policy Act regulations at paragraph A6 

of appendix A to subpart D, 10 CFR part 

1021, which applies to rulemakings that 

are strictly procedural. Accordingly, 

neither an EIS nor an EA is required. 

D. Regulatory Flexibility Act 

The Regulatory Flexibility Act (5 

U.S.C. 601 et seq.) requires preparation 

of an initial regulatory flexibility 

analysis for any rule that by law must 

be proposed for public comment, unless 

the agency certifies that the rule, if 

promulgated, will not have a significant 

economic impact on a substantial 

number of small entities. As required by 

Executive Order 13272, ‘‘Proper 

Consideration of Small Entities in 

Agency Rulemaking,’’ 67 FR 53461 

(August 16, 2002), DOE published 

procedures and policies on February 19, 

2003, to ensure that the potential 

impacts of its rules on small entities are 

properly considered during the 

rulemaking process (68 FR 7990). DOE 

has made its procedures and policies 

available on the Office of General 

Counsel’s website: http://

www.gc.doe.gov. 

DOE has reviewed this final rule 

under the provisions of the Regulatory 

Flexibility Act and the procedures and 

policies published on February 19, 

2003. This final rule will require DOE 

to issue an export authorization upon 

receipt of any complete application that 

seeks to export natural gas, including 

LNG, to non-FTA countries, provided 

that the application satisfies the 

following two criteria: (1) The 

application proposes to export natural 

gas in a volume up to and including 

51.75 Bcf/yr, and (2) DOE’s approval of 

the application does not require an EIS 

or an EA under NEPA. DOE’s 

regulations regarding notice of 

applications and procedures conducted 


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35118 Federal Register / Vol. 83, No. 143 / Wednesday, July 25, 2018 / Rules and Regulations 

53Seven of the eight applications are identified in 

section I.C of the proposed rule (82 FR 41572; Sept. 

1, 2017). The eighth authorization was issued on 

September 15, 2017, after the NOPR was published. 

See Eagle LNG Partners Jacksonville II LLC, DOE/ 

FE Order No. 4078, supra note 5. 

on applications do not apply to 

applications that satisfy these criteria. 

To date, DOE has received—and 

granted—eight applications to export 

LNG in volumes below 51.75 Bcf/yr of 

natural gas to non-FTA countries.53 Of 

these eight applicants, three qualify as 

small businesses under the Small 

Business Administration’s size 

standards of 1000 employees or less 

under both NAICS 221210, Natural Gas 

Distribution, and NAICS 325120, 

Industrial Gas Manufacturing. Because 

the final rule will streamline the 

application and approval process for 

small-scale natural gas exports, it will 

not result in a significant economic 

impact on a substantial number of small 

entities. The final rule will, however, 

provide greater regulatory certainty for 

applicants by eliminating the individual 

application proceeding and public 

interest evaluation for qualifying 

applications. This, in turn, will both 

reduce the administrative burden 

associated with the application process 

and expedite authorization of qualifying 

applications, removing (at a minimum) 

the opportunity cost of receiving an 

application delayed by the current 

procedures. 

DOE received no comments on this 

certification. Comments regarding the 

economic impact of the proposed rule 

are responded to in Section II of the 

preamble, and for the reasons explained 

in Section II, those comments did not 

affect this certification, or result in any 

changes from the proposal in this final 

rule. 

Therefore, DOE certifies that this 

rulemaking will not have a significant 

economic impact on a substantial 

number of small entities. Accordingly, 

DOE did not prepare an IRFA for this 

rulemaking. DOE’s certification and 

supporting statement of factual basis 

was provided to the Chief Counsel for 

Advocacy of the Small Business 

Administration for review under 5 

U.S.C. 605(b). 

E. Paperwork Reduction Act 

The final rule does not change any 

requirements subject to review and 

approval by OMB pursuant to the 

Paperwork Reduction Act of 1995 (44 

U.S.C. 3501 et seq.) and the procedures 

implementing that Act, 5 CFR 1320.1 et 

seq. Current natural gas import and 

export authorization holders, including 

any approved under this final rule, 

would be subject to the information 

collection requirements approved by the 

Office of Management and Budget under 

OMB Control No. 1901–0294. Public 

reporting burden for the certification is 

estimated to average 3 hours per 

response, including the time for 

reviewing instructions, searching 

existing data sources, gathering and 

maintaining the data needed, and 

completing and reviewing the collection 

of information. 

Notwithstanding any other provision 

of the law, no person is required to 

respond to, nor shall any person be 

subject to a penalty for failure to comply 

with, a collection of information subject 

to the requirements of the PRA, unless 

that collection of information displays a 

currently valid OMB Control Number. 

F. Unfunded Mandates Reform Act of 

1995 

The Unfunded Mandates Reform Act 

of 1995 (Pub. L. 104–4) generally 

requires Federal agencies to examine 

closely the impacts of regulatory actions 

on tribal, state, and local governments. 

Subsection 101(5) of title I of that law 

defines a Federal intergovernmental 

mandate to include any regulation that 

would impose upon tribal, state, or local 

governments an enforceable duty, 

except a condition of Federal assistance 

or a duty arising from participating in a 

voluntary Federal program. Title II of 

that law requires each Federal agency to 

assess the effects of Federal regulatory 

actions on tribal, state, and local 

governments, in the aggregate, or to the 

private sector, other than to the extent 

such actions merely incorporate 

requirements specifically set forth in a 

statute. Section 202 of that title requires 

a Federal agency to perform a detailed 

assessment of the anticipated costs and 

benefits of any rule that includes a 

Federal mandate which may result in 

costs to tribal, state, or local 

governments, or to the private sector, of 

$100 million or more in any one year 

(adjusted annually for inflation). 2 

U.S.C. 1532(a) and (b). Section 204 of 

that title requires each agency that 

proposes a rule containing a significant 

Federal intergovernmental mandate to 

develop an effective process for 

obtaining meaningful and timely input 

from elected officers of tribal, state, and 

local governments. 2 U.S.C. 1534. 

This final rule will streamline 

procedures for small-scale natural gas 

exports. DOE has determined that the 

final rule will not result in the 

expenditure by tribal, state, and local 

governments in the aggregate, or by the 

private sector, of $100 million or more 

in any one year. Accordingly, no 

assessment or analysis is required under 

the Unfunded Mandates Reform Act of 

1995. 

G. Treasury and General Government 

Appropriations Act, 1999 

Section 654 of the Treasury and 

General Government Appropriations 

Act, 1999 (Pub. L. 105–277) requires 

Federal agencies to issue a Family 

Policymaking Assessment for any final 

rule that may affect family well-being. 

The final rule will not have any impact 

on the autonomy or integrity of the 

family as an institution. Accordingly, 

DOE has concluded that it is not 

necessary to prepare a Family 

Policymaking Assessment. 

H. Executive Order 13132 

Executive Order 13132, ‘‘Federalism,’’ 

64 FR 43255 (August 4, 1999) imposes 

certain requirements on agencies 

formulating and implementing policies 

or regulations that preempt state law or 

that have Federalism implications. 

Agencies are required to examine the 

constitutional and statutory authority 

supporting any action that would limit 

the policymaking discretion of the states 

and carefully assess the necessity for 

such actions. DOE has examined this 

final rule and has determined that it 

will not preempt state law and will not 

have a substantial direct effect on the 

states, on the relationship between the 

national government and the states, or 

on the distribution of power and 

responsibilities among the various 

levels of government. No further action 

is required by Executive Order 13132. 

I. Executive Order 12988 

With respect to the review of existing 

regulations and the promulgation of 

new regulations, section 3(a) of 

Executive Order 12988, ‘‘Civil Justice 

Reform,’’ 61 FR 4729 (February 7, 1996), 

imposes on Executive agencies the 

general duty to adhere to the following 

requirements: (1) Eliminate drafting 

errors and ambiguity; (2) write 

regulations to minimize litigation; and 

(3) provide a clear legal standard for 

affected conduct rather than a general 

standard and promote simplification 

and burden reduction. With regard to 

the review required by section 3(a), 

section 3(b) of Executive Order 12988 

specifically requires that Executive 

agencies make every reasonable effort to 

ensure that the regulation: (1) Clearly 

specifies the preemptive effect, if any; 

(2) clearly specifies any effect on 

existing Federal law or regulation; (3) 

provides a clear legal standard for 

affected conduct while promoting 

simplification and burden reduction; (4) 

specifies the retroactive effect, if any; (5) 

adequately defines key terms; and (6) 


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Federal Register / Vol. 83, No. 143 / Wednesday, July 25, 2018 / Rules and Regulations 35119 

addresses other important issues 

affecting clarity and general 

draftsmanship under any guidelines 

issued by the Attorney General. Section 

3(c) of Executive Order 12988 requires 

Executive agencies to review regulations 

in light of applicable standards in 

section 3(a) and section 3(b) to 

determine whether they are met or it is 

unreasonable to meet one or more of 

them. DOE has completed the required 

review and determined that, to the 

extent permitted by law, the final rule 

meets the relevant standards of 

Executive Order 12988. 

J. Treasury and General Government 

Appropriations Act, 2001 

The Treasury and General 

Government Appropriations Act, 2001 

(44 U.S.C. 3516 note) provides for 

agencies to review most disseminations 

of information to the public under 

guidelines established by each agency 

pursuant to general guidelines issued by 

OMB. 

OMB’s guidelines were published at 

67 FR 8452 (February 22, 2002), and 

DOE’s guidelines were published at 67 

FR 62446 (October 7, 2002). DOE has 

reviewed this final rule under the OMB 

and DOE guidelines and has concluded 

that it is consistent with applicable 

policies in those guidelines. 

K. Executive Order 13211 

Executive Order 13211, ‘‘Actions 

Concerning Regulations That 

Significantly Affect Energy Supply, 

Distribution, or Use,’’ 66 FR 28355 (May 

22, 2001) requires Federal agencies to 

prepare and submit to the OMB, a 

Statement of Energy Effects for any 

proposed significant energy action. A 

‘‘significant energy action’’ is defined as 

any action by an agency that 

promulgated or is expected to lead to 

promulgation of a final rule, and that: 

(1) Is a significant regulatory action 

under Executive Order 12866, or any 

successor order; and (2) is likely to have 

a significant adverse effect on the 

supply, distribution, or use of energy, or 

(3) is designated by the Administrator of 

OIRA as a significant energy action. For 

any proposed significant energy action, 

the agency must give a detailed 

statement of any adverse effects on 

energy supply, distribution, or use 

should the proposal be implemented, 

and of reasonable alternatives to the 

action and their expected benefits on 

energy supply, distribution, and use. 

This regulatory action, which is 

intended to streamline the application 

and approval process for small-scale 

natural gas exports, will not have a 

significant adverse effect on the supply, 

distribution, or use of energy, and 

therefore is not a significant energy 

action. Accordingly, DOE has not 

prepared a Statement of Energy Effects. 

L. Congressional Notification 

As required by 5 U.S.C. 801, DOE will 

report to Congress on the promulgation 

of this rule prior to its effective date. 

The report will state that it has been 

determined that the rule is not a ‘‘major 

rule’’ as defined by 5 U.S.C. 804(2). 

IV. Approval of the Office of the 

Secretary 

The Secretary of Energy has approved 

the publication of this final rule. 

List of Subjects in 10 CFR Part 590 

Administrative practice and 

procedure, Exports, Natural gas, 

Reporting and recordkeeping 

requirements. 

Signed in Washington, DC, on July 19, 

2018. 

Steven E. Winberg, 

Assistant Secretary, Office of Fossil Energy. 

For the reasons stated in the 

preamble, DOE amends part 590, 

chapter II of title 10, subchapter G, Code 

of Federal Regulations as set forth 

below: 

PART 590—ADMINISTRATIVE 

PROCEDURES WITH RESPECT TO 

THE IMPORT AND EXPORT OF 

NATURAL GAS 

■ 1. The authority citation for part 590 

continues to read as follows: 

Authority: Secs. 301(b), 402(f), and 644, 

Pub. L. 95–91, 91 Stat. 578, 585, and 599 (42 

U.S.C. 7151(b), 7172(f), and 7254), Sec. 3, Act 

of June 21, 1938, c. 556, 52 Stat. 822 (15 

U.S.C. 717b); E.O. 12009 (42 FR 46267, 

September 15, 1977); DOE Delegation Order 

Nos. 0204–111 and 0204–127 (49 FR 6684, 

February 22, 1984; 54 FR 11437, March 20, 

1989). 

■ 2. Section 590.102 is amended by 

redesignating paragraph (p) as 

paragraph (q) and adding new paragraph 

(p) to read as follows: 

§ 590.102 Definitions. 

* * * * * 

(p) Small-scale natural gas export 

means an export of natural gas to 

nations with which there is not in effect 

a free trade agreement with the United 

States requiring national treatment for 

trade in natural gas and with which 

trade is not prohibited by U.S. law or 

policy, provided that the application for 

such export authority satisfies the 

following two criteria: 

(1) The application proposes to export 

natural gas in a volume up to and 

including 51.75 billion cubic feet per 

year, and 

(2) DOE’s approval of the application 

does not require an environmental 

impact statement or an environmental 

assessment under the National 

Environmental Policy Act, 42 U.S.C. 

4321 et seq. 

* * * * * 

■ 3. Section 590.208 is revised to read 

as follows: 

§ 590.208 Small volume exports. 

(a) Small-scale natural gas exports. 

Small-scale natural gas exports are 

deemed to be consistent with the public 

interest under section 3(a) of the Natural 

Gas Act, 15 U.S.C. 717b(a). DOE will 

issue an export authorization upon 

receipt of any complete application to 

conduct small-scale natural gas exports. 

DOE’s regulations regarding notice of 

applications, 10 CFR 590.205, and 

procedures applicable to application 

proceedings, 10 CFR part 590, subpart C 

(10 CFR 590.303 to 10 CFR 590.317), are 

not applicable to small-scale natural gas 

exports. 

(b) Scientific, experimental, or other 

non-utility natural gas exports. Any 

person may export up to 100,000 cubic 

feet of natural gas (14.73 pounds per 

square inch at 60 degrees Fahrenheit) or 

the liquefied or compressed equivalent 

thereof, in a single shipment for 

scientific, experimental, or other nonutility gas use without prior 

authorization of the Assistant Secretary. 

[FR Doc. 2018–15903 Filed 7–24–18; 8:45 am] 

BILLING CODE 6450–01–P 

DEPARTMENT OF TRANSPORTATION 

Federal Aviation Administration 

14 CFR Part 23 

[Docket No. FAA–2018–0678; Special 

Conditions No. 23–290–SC] 

Special Conditions: TCW 

Technologies, LLC; Piper Aircraft PA– 

32 Series Airplanes; Installation of 

Rechargeable Lithium Batteries 

AGENCY: Federal Aviation 

Administration (FAA), DOT. 

ACTION: Final special conditions; request 

for comments. 

SUMMARY: These special conditions are 

issued for the Piper Aircraft Model PA– 

32-series airplanes. These airplanes, as 

modified by TCW Technologies, LLC, 

will have a novel or unusual design 

feature associated with the installation 

of a rechargeable lithium battery. The 

applicable airworthiness regulations do 

not contain adequate or appropriate 

safety standards for this design feature. 


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