[Federal Register Volume 82, Number 169 (Friday, September 1, 2017)]
[Proposed Rules]
[Pages 41570-41577]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-18580]


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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 82 , No. 169 / Friday, September 1, 2017 / 
Proposed Rules

[[Page 41570]]



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: Notice of proposed rulemaking.

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SUMMARY: The Department of Energy (DOE or Department) proposes to 
revise 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 0.14 billion cubic feet (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). In proposing this 
revision, DOE is interpreting the phrase ``public interest'' set forth 
in the Natural Gas Act (NGA). DOE proposes that applications that 
satisfy these criteria are requesting authorization for ``small-scale 
natural gas exports'' and, as such, the exports are deemed to be 
consistent with the public interest under the NGA. DOE's regulations 
regarding notice of applications and procedures conducted on 
applications would no longer apply to applications that satisfy these 
criteria. The proposed regulation is intended to expedite DOE's 
processing of these applications, thereby reducing administrative 
burdens for the small-scale natural gas export market.

DATES: Public comment on this proposed rule will be accepted until 
October 16, 2017.

ADDRESSES: You may submit comments identified by Regulation Identifier 
Number (RIN) 1901-AB43 and FE Docket No. 17-86-R. Use any of the 
following methods, although the eRulemaking Portal is preferred:
    1. Federal eRulemaking Portal (the preferred method): Follow the 
instructions for submitting comments on the Federal eRulemaking Portal 
at http://www.regulations.gov.
    2. Email: Send email to <a href="/cdn-cgi/l/email-protection#35535047525446755d441b515a501b525a43"><span class="__cf_email__" data-cfemail="610704130600122109104f050e044f060e17">[email protected]</span></a>. Include RIN 1901-AB43 
and FE Docket No. 17-86-R in the subject line of the email. Please 
include the full body of your comments in the text of the message or as 
an attachment.
    3. Regular Mail: U.S. Department of Energy (FE-34), Office of 
Regulation and International Engagement, Office of Fossil Energy, P.O. 
Box 44375, Washington, DC 20026-4375.
    4. Hand Delivery or Private Delivery Services (e.g., FedEx, UPS, 
etc.): 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. 
Telephone: 202-586-9478.
    Due to potential delays in the delivery of postal mail, we 
encourage respondents to submit comments electronically to ensure 
timely receipt. Please Note: If submitting a filing via email, please 
include all related documents and attachments (e.g., exhibits) in the 
original email correspondence. Please do not include any active 
hyperlinks or password protection in any of the documents or 
attachments related to the filing. All electronic filings submitted to 
DOE must follow these guidelines to ensure that all documents are filed 
in a timely manner. Any hardcopy filing submitted greater in length 
than 50 pages must also include, at the time of the filing, a digital 
copy on disk of the entire submission.
    Docket: This notice of proposed rulemaking and any comments that 
DOE receives will be made available on the Federal eRulemaking Portal 
at http://www.regulations.gov, and also on DOE's Web site at: https://www.energy.gov/fe/services/natural-gas-regulation.

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:

I. Background
    A. Statutory Background
    B. DOE's Public Interest Analysis
    C. DOE's Non-FTA Export Authorization Orders Since 2012
II. Discussion of Proposed Rule
    A. Summary of and Reasons for Proposed Rule
    B. Consistency With Section 3 of the Natural Gas Act
    C. Consistency With the Public Interest
    D. Consistency With Free Market Principles
III. Regulatory Review
    A. Executive Orders 12866 and 13563
    B. National Environmental Policy Act
    C. Regulatory Flexibility Act
    D. Paperwork Reduction Act
    E. Unfunded Mandates Reform Act of 1995
    F. Treasury and General Government Appropriations Act, 1999
    G. Executive Order 13132
    H. Executive Order 12988
    I. Treasury and General Government Appropriations Act, 2001
    J. Executive Order 13211
IV. Approval of the Office of the Secretary

I. Background

A. Statutory Background

    The Department of Energy is responsible for authorizing exports of 
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. Accordingly, DOE conducts an informal adjudication and grants 
the application unless DOE finds that the proposed exportation will not 
be consistent with

[[Page 41571]]

the public interest.\2\ Before reaching a final decision on any non-FTA 
application, DOE must also comply with NEPA, 42 U.S.C. 4321 et seq.
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    \1\ This notice of proposed rulemaking does not apply to exports 
to FTA countries under section 3(c) of the NGA, 15 U.S.C. 717b(c).
    \2\ 15 U.S.C. 717b(a); see, e.g., Golden Pass Products LLC, DOE/
FE Order No. 3978, FE Docket No. 12-156-LNG, Opinion and Order 
Granting Long-Term, Multi-Contract Authorization to Export Liquefied 
Natural Gas by Vessel from the Golden Pass LNG Terminal Located in 
Jefferson County, Texas, to Non-Free Trade Agreement Nations, at 18, 
162 (Apr. 25, 2017).
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    Typically, the federal agency responsible for permitting the export 
facility serves as the lead agency in the NEPA review process, and DOE 
serves as a cooperating agency within the meaning of the Council on 
Environmental Quality's (CEQ) regulations, 40 CFR 1501.4, 1501.5. For 
LNG terminals located onshore or in state waters, the agency 
responsible for permitting the export facilities is the Federal Energy 
Regulatory Commission (FERC) pursuant to authority delegated by DOE 
under section 3(e) of the Natural Gas Act, 15 U.S.C. 717b(e). For LNG 
terminals located offshore beyond state waters, the responsible agency 
is the Maritime Administration (MARAD) within the Department of 
Transportation pursuant to section 3(9) of the Deepwater Ports Act, as 
amended by section 312 of the Coast Guard and Maritime Transportation 
Act of 2012 (Pub. L. 112-213).
    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 from the preparation or adoption of an EIS or EA pursuant to 
DOE's regulations implementing NEPA, 10 CFR 1021.410, appendices A & B. 
For example, categorical exclusion B5.7 of DOE's regulations (10 CFR 
part 1021, subpart D, appendix B5.7) applies to natural gas import or 
export activities requiring minor operational changes to existing 
projects, but no new construction.

B. DOE's Public Interest Analysis Under Section 3(a) of the Natural Gas 
Act

    Although NGA section 3(a) establishes a broad public interest 
standard and a presumption favoring export authorizations, the statute 
does not define ``public interest'' or identify criteria that must be 
considered in evaluating the public interest. In prior decisions, DOE 
has identified a range of factors that it evaluates when reviewing an 
application for export authorization. These factors include economic 
impacts, international impacts, security of natural gas supply, and 
environmental impacts, among others. To conduct this review, DOE looks 
to record evidence developed in the application proceeding.\3\
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    \3\ See, e.g., Golden Pass Products, DOE/FE Order No. 3978, at 
135-66.
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    DOE's prior decisions have also looked to certain principles 
established in its 1984 Policy Guidelines.\4\ The goals of the Policy 
Guidelines are to minimize federal control and involvement in energy 
markets and to promote a balanced and mixed energy resource system. The 
Guidelines provide that:
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    \4\ New Policy Guidelines and Delegations Order Relating to 
Regulation of Imported Natural Gas, 49 FR 6684 (Feb. 22, 1984) 
[hereinafter 1984 Policy Guidelines].

    The market, not government, should determine the price and other 
contract terms of imported [or exported] natural gas. . . . The 
federal government's primary responsibility in authorizing imports 
[or exports] will be to evaluate the need for the gas and whether 
the import [or export] arrangement will provide the gas on a 
competitively priced basis for the duration of the contract while 
minimizing regulatory impediments to a freely operating market.\5\
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    \5\ Id. at 6685.

While the Policy Guidelines are nominally applicable to natural gas 
import cases, DOE subsequently held in Order No. 1473 that the same 
Policy Guidelines should be applied to natural gas export 
applications.\6\
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    \6\ Phillips Alaska Natural Gas, DOE/FE Order No. 1473, at 14 
(citing Yukon Pacific Corp., DOE/FE Order No. 350, Order Granting 
Authorization to Export Liquefied Natural Gas from Alaska, 1 FE ] 
70,259, at 71,128 (1989)).
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    In Order No. 1473, DOE stated that it was further guided by DOE 
Delegation Order No. 0204-111. That delegation order, which authorized 
the Administrator of the Economic Regulatory Administration to exercise 
the agency's review authority under NGA section 3, directed the 
Administrator to regulate exports ``based on a consideration of the 
domestic need for the gas to be exported and such other matters as the 
Administrator finds in the circumstances of a particular case to be 
appropriate.'' \7\ (In February 1989, the Assistant Secretary for 
Fossil Energy assumed the delegated responsibilities of the 
Administrator of ERA.\8\)
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    \7\ DOE Delegation Order No. 0204-111, at 1; see also 1984 
Policy Guidelines, 49 FR at 6690.
    \8\ See Applications for Authorization to Construct, Operate, or 
Modify Facilities Used for the Export or Import of Natural Gas, 62 
FR 30,435, 30,437 n.15 (June 4, 1997) (citing DOE Delegation Order 
No. 0204-127, 54 FR 11,436 (Mar. 20, 1989)).
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    Although DOE Delegation Order No. 0204-111 is no longer in effect, 
DOE's review of export applications has continued to focus on: (i) The 
domestic need for the natural gas proposed to be exported, (ii) whether 
the proposed exports pose a threat to the security of domestic natural 
gas supplies, (iii) whether the arrangement is consistent with DOE's 
policy of promoting market competition, and (iv) any other factors 
bearing on the public interest, as determined by DOE.
    Additionally, since 2011, DOE has commissioned several studies to 
evaluate the reasonably foreseeable economic and environmental impacts 
of natural gas exports, and to respond to concerns about exports 
submitted to DOE in various proceedings. These studies include: Effect 
of Increased Natural Gas Exports on Domestic Energy Markets (2012 EIA 
\9\ Study) and Macroeconomic Impacts of LNG Exports from the United 
States (NERA Study) (collectively, 2012 LNG Export Study); \10\ Effect 
of Increased Levels of Liquefied Natural Gas Exports on U.S. Energy 
Markets (2014 EIA LNG Export Study); \11\ The Macroeconomic Impact of 
Increasing U.S. LNG Exports (2015 LNG Export Study); \12\ the Addendum 
to Environmental Review Documents Concerning Exports of Natural Gas 
from the United States (Addendum); \13\ and the Life Cycle Greenhouse 
Gas Perspective on Exporting Liquefied Natural Gas from the United 
States (LCA GHG Report).\14\ DOE published these studies in the Federal 
Register and has responded to the public comments received on each 
study.\15\
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    \9\ ``EIA'' refers to the U.S. Energy Information 
Administration.
    \10\ See 2012 LNG Export Study, 77 FR 73,627 (Dec. 11, 2012), 
available at: http://energy.gov/sites/prod/files/2013/04/f0/fr_notice_two_part_study.pdf.
    \11\ U.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.
    \12\ Center 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.
    \13\ Dep't of Energy, Addendum to Environmental Review Documents 
Concerning Exports of Natural Gas From the United States, 79 FR 
48,132 (Aug. 15, 2014), available at: http://energy.gov/fe/addendum-environmental-review-documents-concerning-exports-natural-gas-united-states.
    \14\ Dep't of Energy, Life Cycle Greenhouse Gas Perspective on 
Exporting Liquefied Natural Gas From the United States, 79 FR 32,260 
(June 4, 2014). DOE/FE announced the availability of the LCA GHG 
Report on its Web site on May 29, 2014.
    \15\ See, e.g. Cheniere Marketing, LLC and Corpus Christi 
Liquefaction, LLC, DOE/FE Order No. 3638, FE Docket No. 12-97-LNG, 
Final Order and Opinion Granting Long-Term, Multi-Contract 
Authorization to Export Liquefied Natural Gas by Vessel from the 
Proposed Corpus Christi Liquefaction Project to Be Located in Corpus 
Christi, Texas, to Non-Free Trade Agreement Nations, at 94-148, 167-
83 (May 12, 2015); Golden Pass Products, DOE/FE Order No. 3978, at 
71-92.

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[[Page 41572]]

    The 2012 EIA Study generally found that natural gas exports will 
lead to higher domestic natural gas prices, increased domestic natural 
gas production, reduced domestic natural gas consumption, and increased 
natural gas imports from Canada via pipeline. Among the key findings of 
the NERA Study (the second part of the 2012 LNG Export Study), NERA 
projected that the United States would gain net economic benefits from 
allowing LNG exports. For every market scenario examined, the NERA 
Study determined that economic benefits increased as the level of 
natural gas exports increased.
    The 2014 EIA LNG Export Study found that natural gas exports will 
generally lead to relatively modest domestic natural gas price 
increases, increased domestic natural gas production, reduced domestic 
natural gas consumption, and higher levels of economic output (as 
measured by real gross domestic product).
    The 2015 LNG Export 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. The analysis 
covered the 2015 to 2040 time period. The 2015 Study made the following 
key findings:
    <bullet> Rising natural gas exports are associated with a net 
increase in domestic natural gas production;
    <bullet> As exports increase, the spread between U.S. domestic 
prices and international benchmarks narrows;
    <bullet> The overall macroeconomic impacts of higher natural gas 
exports are marginally positive--a result that is robust to alternative 
assumptions for the U.S. natural gas market;
    <bullet> An increase in U.S. natural gas exports will generate 
small declines in output at the margin for some energy-intensive, 
trade-exposed industries; and
    <bullet> Negative impacts in energy-intensive sectors are offset by 
positive impacts elsewhere.
    The Addendum evaluated environmental impacts including water 
resources, air quality, greenhouse gas emissions, induced seismicity, 
and land use impacts. The DOE Addendum concluded that DOE cannot 
meaningfully estimate where, when, or by what particular method 
additional natural gas would be produced in response to non-FTA export 
demand.
    Finally, although not directly relevant to this proposed rule,\16\ 
the LCA GHG Report reached conclusions regarding the use of U.S. 
natural gas exports to produce electricity in European and Asian 
markets, as well as the life cycle greenhouse gas emissions of exported 
U.S. natural gas as compared to other sources of natural gas in those 
markets.
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    \16\ DOE considers the LCA GHG Report in non-FTA export 
proceedings whenever an application seeks to transport LNG by LNG 
tanker from large-scale liquefaction facilities to non-FTA 
countries. By contrast, small-scale exports of natural gas 
(including LNG) typically are transported shorter distances using 
other transportation methods, such as ISO containers loaded onto 
container ships. DOE therefore does not consider the LCA GHG Report 
as part of the record in those proceedings. See infra (identifying 
seven non-FTA export authorizations for which the LCA GHG Report was 
not considered in the application proceeding, and discussing 
transportation of small-scale exports).
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C. DOE's Non-FTA Export Authorizations Since 2012

    To date, DOE has issued 28 final export authorizations to non-FTA 
countries, bringing the cumulative total of approved non-FTA exports of 
LNG and compressed natural gas (CNG) to 21.33 Bcf/d of natural gas, or 
7.79 trillion cubic feet per year.\17\ These non-FTA authorizations are 
available online at the DOE/FE E-Docket Room.\18\
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    \17\ See Lake Charles LNG Export Co., LLC, DOE/FE Order No. 
4010, FE Docket No. 16-109-LNG, Opinion and Order Granting Long-
Term, Multi-Contract Authorization to Export Liquefied Natural Gas 
by Vessel from the Lake Charles Terminal in Calcasieu Parish, 
Louisiana, to Non-Free Trade Agreement Nations, at 43-46 (June 29, 
2017).
    \18\ Dep't of Energy, Office of Fossil Energy, Electronic Docket 
Room (E-Docket Room), https://www.energy.gov/fe/downloads/electronic-docket-room-e-docket-room.
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    Of these 28 non-FTA authorizations, seven authorize exports in 
volumes below 0.14 Bcf/d of natural gas--the volume limitation set 
forth in the criteria for this proposed rulemaking. These seven 
authorizations include: Carib Energy (USA) LLC (0.04 Bcf/d), American 
Marketing LLC (0.008 Bcf/d), Emera CNG, LLC (0.008 Bcf/d), Floridian 
Natural Gas Storage Company, LLC (0.04 Bcf/d), Air Flow North American 
Corp. (0.002 Bcf/d), Flint Hills Resources, LP (0.01 Bcf/d), and Carib 
Energy (USA), LLC (0.004).\19\ Together, these authorizations approve 
exports of LNG and CNG in a combined volume of 0.112 Bcf/d--less than 
0.6% of the cumulative volume of non-FTA exports approved by DOE to 
date.
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    \19\ See Lake Charles LNG Export Co., DOE/FE Order No. 4010, at 
43-46 (citing these authorizations).
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    In each of the 28 non-FTA export authorizations issued to date, and 
on the basis of the record evidence presented in those proceedings, DOE 
has reached the following conclusions as part of its public interest 
determination for each application:
    <bullet> Substantial domestic natural gas supplies exist to meet 
domestic natural gas demand and increased natural gas exports;
    <bullet> While increased natural gas exports will result in higher 
U.S. natural gas prices, these price changes remain in a relatively 
narrow range across the scenarios studied and the domestic natural gas 
market is capable of accommodating increased natural gas exports 
without significant negative price or other economic impacts;
    <bullet> Even with these estimated price increases, increased 
natural gas exports are likely to generate net economic benefits for 
the United States;
    <bullet> Increased natural gas exports stimulate local, regional, 
and national economies through direct and indirect job creation, 
increased economic activity, and tax revenues; and
    <bullet> Increased natural gas exports increase diversity of supply 
in the global natural gas market, in turn benefiting international 
trade and relations as well as global energy security.

DOE also has observed that it is far from certain that all or even most 
of the proposed natural gas export projects will be realized because of 
the time, difficulty, and expense of commercializing, financing, and 
constructing such projects, as well as the uncertainties inherent in 
the global market demand for natural gas.\20\
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    \20\ See, e.g., Golden Pass Products, DOE/FE Order No. 3978, at 
Section XII and 161.
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II. Discussion of Proposed Rule

A. Summary of and Reasons for Proposed Rule

    The emerging small-scale export 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. Many of these countries do not generate enough natural gas 
demand to support the economies of scale required to justify large 
volumes of LNG imports from large-scale LNG terminals via conventional 
LNG tankers. The small-scale natural gas export market has developed as 
a solution to the practical and economic constraints limiting natural 
gas exports to these countries.
    DOE is proposing to revise its regulations to expedite the 
application and approval process for small-scale exports of natural 
gas. Specifically, the proposed rule provides that DOE, upon receipt of 
any complete application to export natural gas (including LNG) to non-
FTA countries, 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

[[Page 41573]]

0.14 Bcf/d; and (2) DOE's approval of the application does not require 
an EIS or EA under NEPA--that is, the application is eligible for a 
categorical exclusion under DOE's NEPA regulations.
    For each small-scale 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 Web 
site, consistent with DOE practice. Next, DOE will determine if the 
application meets the criteria for a small-scale natural gas export. If 
the application meets the criteria, DOE will issue a non-FTA 
authorization granting the application on an expedited basis, without 
providing notice of application and other procedures typically required 
for non-FTA 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). All 
small-scale natural gas export authorizations issued pursuant to these 
regulations will be posted on DOE's Web site, and will contain 
appropriate terms and conditions consistent with DOE's regulations and 
practice.
    DOE notes that entities involved in this emerging market typically 
define ``small-scale'' natural gas exports as exports of 1.0 million 
metric tons per annum (mtpa) or lower.\21\ When converting from million 
metric tons to billion cubic feet, DOE uses a conversion factor of 
51.75 Bcf per million metric tons of dry natural gas.\22\ Based on this 
conversion factor, 1 million metric tons per annum equates to 
approximately 0.14 Bcf/d of natural gas. Consequently, as the first 
criterion for the proposed rule, DOE proposes to define small-scale 
natural gas exports as any export of natural gas up to and including a 
volume of 0.14 Bcf/d. DOE believes this volume limitation is consistent 
with industry practice, but invites comment on any other appropriate 
small-scale volume limitation.
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    \21\ See, e.g., Int'l Gas Union, IGU World Gas LNG Report 59 
(2016 ed.), available at: www.igu.org/download/file/fid/2123 (``IGU 
defines the large-scale LNG industry as every LNG business above 1 
million MTPA of LNG production and/or consumption. Conversely, 
small-scale LNG is any business under 1 million MTPA.''); Int'l Gas 
Union, Small Scale LNG 11 (June 2015), available at: http://www.igu.org/sites/default/files/node-page-field_file/SmallScaleLNG.pdf (``For the purpose of this report, the [small-
scale LNG] production installed capacity has been defined as below 1 
million metric tons per annum (mtpa).''); C[eacute]dric Andrieu, Gas 
Tech. Inst., Et Al., Small Scale LNG Import Terminal: Not As Simple 
As A Reduced One 2, 4 (Conference Paper, LNG 17 International 
Conference & Exhibition on Liquefied Natural Gas, 2013), available 
at: http://www.gastechnology.org/Training/Documents/LNG17-proceedings/Storage-6-Cedric_Andrieu.pdf (``Typically, the send-out 
rate of . . . small LNG terminals is ranging from 0.2 to 1 mtpa.'').
    \22\ See, e.g., Southern LNG Company, L.L.C., DOE/FE Order No. 
3956, FE Docket No. 12-100-LNG, Opinion and Order Granting Long-
Term, Multi-Contract Authorization to Export Liquefied Natural Gas 
by Vessel from the Elba Island Terminal in Chatham County, Georgia, 
to Non-Free Trade Agreement Nations (Dec. 16, 2016), at Ordering 
Para. H.
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    As the second criterion for this proposed rule, DOE must determine 
that its approval of the application does not require an EIS or an EA 
under NEPA, because it qualifies for a categorical exclusion. For 
example, pursuant to DOE's categorical exclusion B5.7, a small-scale 
natural gas export that involves only existing facilities and/or minor 
operational changes is an action that does not involve new 
construction.
    Any application that satisfies these two criteria would qualify as 
a ``small-scale natural gas export'' as that term is defined under this 
proposed rule, and would be deemed to be consistent with the public 
interest under NGA section 3(a). As noted above, DOE's regulations 
regarding notice of applications, 10 CFR 590.205, and procedures 
applicable to application proceedings, 10 CFR 590 subpart C (10 CFR 
590.301 to 10 CFR 590.317), would not apply to applications that 
satisfy these criteria. Rather, this proposed rule, and the 45-day 
comment period for this proposed rule, would constitute the notice and 
opportunity for hearing on all prospective small-scale natural gas 
export applications.
    This proposed rule is limited to qualifying small-scale exports of 
natural gas. If adopted, this proposed rule would not affect either 
existing DOE authorizations or DOE's evaluation of any non-FTA 
application that does not meet the criteria for small-scale natural gas 
exports. In expediting the application and approval process for these 
exports, DOE recognizes the unique characteristics and minimal adverse 
impacts of the small-scale natural gas market emerging primarily in the 
United States, the Caribbean, Central America, and South America. As 
discussed below, the proposed 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.

B. Consistency With Section 3(a) of the Natural Gas Act

    Under section 3(a) of the NGA, the Secretary of Energy is required 
to issue an order upon application unless, after opportunity for 
hearing, DOE finds that the proposed export ``will not be consistent 
with the public interest.'' \23\ DOE has long interpreted section 3(a) 
as creating a rebuttable presumption that a proposed export of natural 
gas is in the public interest, such that DOE must grant an application 
under section 3(a) unless opponents of the application overcome that 
presumption by making an affirmative showing of inconsistency with the 
public interest.\24\ The statute, however, does not define ``public 
interest'' or identify criteria that DOE must consider when determining 
whether a proposed export of natural gas is consistent with the public 
interest under section 3(a). The statute affords DOE broad discretion 
in determining whether proposed exports to non-FTA countries are 
``consistent with the public interest'' (15 U.S.C. 717b(a)). In this 
proposed rule, DOE is interpreting NGA section 3(a) to determine that 
small-scale natural gas exports are consistent with the public interest 
after considering all relevant factors, including the domestic need for 
the small volumes of natural gas to be exported and the security of 
domestic natural gas supplies.
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    \23\ 15 U.S.C. 717b(a).
    \24\ See id.; see, e.g., Golden Pass Products, DOE/FE Order No. 
3978, at 18, 162.
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C. Consistency With the Public Interest

    In determining that small-scale natural gas exports are consistent 
with the public interest, DOE has considered the economic studies and 
the Addendum discussed in Section I.B, as well as the public comments 
received on these studies. DOE has also considered the 28 final non-FTA 
export authorizations issued to date, including the seven non-FTA 
authorizations approving exports at volumes below 0.14 Bcf/d of natural 
gas (identified in section I.C), as well as the most recent 
authoritative projections for natural gas supply, demand, and prices 
set forth in the Annual Energy Outlook 2017 (AEO 2017).\25\ Based on 
this evidence, and for the reasons described in Section II.A, DOE has 
determined that small-scale natural gas exports are consistent with the 
public interest under NGA section 3(a).
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    \25\ U.S. Energy Information Administration, Annual Energy 
Outlook 2017 (Jan. 2017), available at: http://www.eia.gov/outlooks/aeo.
---------------------------------------------------------------------------

    In reaching this conclusion, DOE has considered the economic 
impacts of higher natural gas prices and potential increases in natural 
gas price volatility and, as noted earlier, has reviewed the economic 
impacts of natural gas exports. Recent advancements in natural

[[Page 41574]]

gas exploration and production technology have changed the outlook for 
the U.S. natural gas market, such that the increase in domestic 
supplies of natural gas will outpace increases in domestic demand.
    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 21.33 Bcf/d of natural gas--well below the 28 Bcf/d 
case considered in the 2015 Study. As DOE has explained in recent 
orders,\26\ the authors of the 2015 Study had to include several 
unlikely assumptions about the global natural gas market for U.S. LNG 
exports to exceed 12 Bcf/d, much less to reach the high resource 
recovery case of 28 Bcf/d of exports. Based on this evidence and the 
small volumes at issue in this proposed rule, DOE believes that 
domestic supplies will be adequate both to meet domestic needs and to 
supply small-scale exports of natural gas.
---------------------------------------------------------------------------

    \26\ See, e.g., Delfin LNG LLC, DOE/FE Order No. 4028, FE Docket 
No. 13-147-LNG, Opinion and Order Granting Long-Term, Multi-Contract 
Authorization to Export Liquefied Natural Gas by Vessel from a 
Proposed Floating Liquefaction Project and Deepwater Port 30 Miles 
Offshore of Louisiana to Non-Free Trade Agreement Nations, at 62-63 
(June 1, 2017).
---------------------------------------------------------------------------

    DOE finds that small-scale natural gas exports meeting the criteria 
set forth in this proposed rulemaking will not interfere with the 
domestic need for natural gas. Likewise, small-scale exports will not 
have a detectable impact on domestic natural gas prices, and will not 
pose a risk to the security of domestic natural gas supplies. While 
small-scale natural gas exports are unlikely to generate negative 
economic or supply impacts in the United States, these exports are 
expected to have positive impacts. Specifically, 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.
    To countries that do not otherwise have access to natural gas, 
small-scale natural gas exports represent an important change in their 
ability to generate electricity. Small-scale exports also will enable 
electric generation facilities in the importing countries to switch 
from heavy fuel oil and diesel to natural gas, providing positive 
environmental benefits through the reduction of emissions at fuel oil 
and diesel burning electric generators. The availability of a reliable 
supply of natural gas to customers outside of the United States who are 
currently burning diesel or fuel oil for power generation may encourage 
conversion to natural gas-based power generation equipment. Companies 
in the United States would be well positioned to provide and support 
this type of power generation equipment, thus providing secondary 
economic benefits from the small-scale exports.
    Additionally, small-scale natural gas exports will enable importing 
countries to diversify their fuel supplies, while contributing to 
greater overall transparency, efficiency, and liquidity of natural gas 
markets outside the United States. To the extent small-scale natural 
gas exports will diversify global natural gas supplies, and increase 
the volumes of natural gas available globally, small-scale natural 
exports will improve energy security for many U.S. allies and trading 
partners. As such, the proposed rule will advance the public interest 
by fostering international relations, trade, and security.

D. Consistency With Free Market Principles

    DOE has consistently subscribed to the principles set forth in the 
1984 Policy Guidelines that the market, not the government, is the most 
efficient means of allocating natural gas supplies. The United States 
has an abundant supply of affordable natural gas that studies have 
shown will significantly exceed domestic demand. Meanwhile, foreign 
demand for natural gas imports from the United States has increased as 
many countries, such as those in the Caribbean, Central America, and 
South America, seek to import cleaner sources of energy.
    The conventional, large-scale natural gas import/export market is 
extremely capital-intensive. Companies must achieve sufficient 
economies of scale to justify their multi-billion dollar investments in 
large-scale LNG terminals and in large-volume LNG tanker fleets. 
However, many of the countries in the Caribbean, Central America, and 
South America simply 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. Small-scale natural gas 
exports represent a market-driven response to fill this gap. In 
contrast to large-scale natural gas exports, small-scale natural gas 
exports typically originate from existing facilities in the United 
States, are transported shorter distances, and rely on a variety of 
transportation modes (such as 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.

III. Regulatory Review

A. Executive Orders 12866 and 13563

    This regulatory action has been determined to not be a 
``significant regulatory action'' under Executive Order 12866, 
``Regulatory Planning and Review,'' 58 FR 51735 (October 4, 1993). 
Accordingly, this action was not 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.) EO 
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 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 proposed rule is consistent with these 
principles. Specifically, this proposed 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

[[Page 41575]]

application satisfies the following two criteria: (1) The application 
proposes to export natural gas in a volume up to and including 0.14 
Bcf/d, 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), would not apply to small-scale natural gas exports. The 
proposed regulation is intended to expedite DOE's processing of these 
applications, thereby reducing administrative burdens for the small-
scale 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 proposed 
rule is expected to be an EO 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, EO 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, EO 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 proposed rule is consistent with the 
directives set forth in these executive orders. Specifically, this 
proposed rule would 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 0.14 Bcf/d, and (2) 
DOE's approval of the application does not require an EIS or an EA 
under NEPA. DOE proposes that applications that satisfy these criteria 
are requesting authorization for ``small-scale 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 would no longer 
apply to applications that satisfy these criteria. The proposed 
regulation would 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 promulgation of these regulations fall 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 
Web site: http://www.gc.doe.gov.
    DOE has reviewed this proposed rule under the provisions of the 
Regulatory Flexibility Act and the procedures and policies published on 
February 19, 2003. As discussed in the preamble, this proposed rule 
would 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 0.14 Bcf/d, 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 
on applications would no longer apply to applications that satisfy 
these criteria.
    To date, DOE has received--and granted--seven applications to 
export LNG in volumes below 0.14 Bcf/d of natural gas to non-FTA 
countries (identified in section I.C). Of these seven applicants, two 
qualify as small businesses under the Small Business Administration's 
size standards under NAICS 221210, Natural Gas

[[Page 41576]]

Distribution, of 1,000 employees or less. Because it would streamline 
the application and approval process for small-scale natural gas 
exports, the proposed rule would not result in a significant economic 
impact on a substantial number of small entities. The proposed rule 
would, 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.
    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 will be 
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 proposed 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 proposed 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 proposed rule would streamline procedures for small-scale 
natural gas exports. DOE has determined that the proposed rule would 
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 proposed rule that may affect family 
well-being. The proposed rule would 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 proposed rule and has 
determined that it would not preempt state law and would 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) 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 proposed 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

[[Page 41577]]

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 proposed 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. For the reasons 
discussed in section II.C, this regulatory action would 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.

IV. Approval of the Office of the Secretary

    The Secretary of Energy has approved the publication of this 
proposed rule.

List of Subjects in 10 CFR Part 590

    Administrative practice and procedure, Exports, Natural gas, 
Reporting and recordkeeping requirements.

    Issued in Washington, DC, on August 25, 2017.
Robert J. Smith,
Acting Assistant Secretary, Office of Fossil Energy.

    For the reasons stated in the preamble, DOE proposes to amend 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

0
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).

0
2. Section 590.102 is amended by:
0
a. Redesignating paragraph (p) as paragraph (q), respectively;
0
b. Adding new paragraph (p).
    The revisions to read as follows:


Sec.  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 0.14 billion cubic feet per day, 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.
* * * * *
0
3. Section 590.208 is revised to read as follows:


Sec.  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 non-utility gas use without prior 
authorization of the Assistant Secretary.

[FR Doc. 2017-18580 Filed 8-31-17; 8:45 am]
BILLING CODE 6450-01-P


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