The D.C. Circuit Court of Appeals on March 18 reversed its vacatur of FERC’s approvals of two LNG export facilities in Texas, having been convinced on appeal that the commission’s procedural errors were not as serious as it had initially judged.

The court had vacated FERC’s 2019 approvals of the Brownsville Shipping Channel and Rio Grande LNG in Cameron County, Texas, and remanded them for additional proceedings in 2024. (See DC Circuit Vacates FERC Approval of Two LNG Facilities in Texas.) The court’s vacatur, along with another decision, led then-Chair Willie Phillips to consider changes to how FERC was reviewing natural gas infrastructure. (See DC Circuit Orders Could Lead FERC to Rethink its Natural Gas Policies.)

The three-judge panel’s initial decision held that while the vacatur might cause significant disruptions to the projects, that did not outweigh the seriousness of the commission’s procedural defects in the case. Among them was that, having its approvals already remanded in 2021, FERC did not conduct new environmental impact statements for the projects.

The court followed a precedent that vacatur is warranted when an agency commits a “fundamental” procedural error, such as skipping an environmental review altogether.

“The procedural steps the commission skipped here were important, but they were not ‘fundamental’ in the same sense,” the same panel said. “The commission has already issued extensive final environmental impact statements reflecting more than three years of review and public comment.”

While the decision reversed the vacaturs, FERC must undertake some additional environmental reviews of specific subjects, like Rio Grande’s proposal to add carbon capture and storage to its facility.

“Against that backdrop, the seriousness of the reauthorization orders’ deficiencies does not outweigh the disruptive effects of vacatur,” the court said. “This court never doubted that vacatur would impose significant disruptive consequences … and respondent-intervenors have provided more details about those consequences in their rehearing petitions.”

The complex, large-scale projects have been in development for more than eight years. The court agreed that vacatur would upend their construction schedules, prevent developers from meeting contractual obligations, and stall their ability to get financing and finalize labor contracts — impacting thousands of jobs.

President Donald Trump’s executive orders on energy have also changed some of the legal questions, but the court declined to resolve new issues they brought up because doing so would not have changed its decision that vacatur was not warranted, it said.