The Department of Energy has approved the first authorization to export liquid natural gas from a new domestic facility since the Biden administration’s pause on new approvals.
“Today marks one of many steps that DOE will be taking to assure our future as a reliable energy supplier to the world and resume regular order to our regulatory responsibilities over natural gas exports,” Energy Secretary Chris Wright said Dec. 14.
The Commonwealth LNG facility, which will be built in Cameron Parish, La., is owned by Kimmeridge Texas Gas and will be able to export 1.2 Bcfd once it is built.
The project won approval from FERC in 2022, but the case was remanded to it by a federal appeals court. FERC is working on a new, supplemental environmental impact statement, and a final order is expected this summer.
Then-President Joe Biden paused DOE’s approval of additional exports in January 2024 so the department could study their impacts. A court overturned the pause over the summer, and Biden’s DOE approved exports from a facility built in Mexico in August. (See DOE Approves 1st LNG Exports Since Biden Administration’s Pause.)
The department released the study in late 2024; it said exporting more LNG would lead to higher domestic prices for the sake of shipping gas not to just allies, but China with its massive demand for energy. Since the report, China has put tariffs on U.S. LNG exports in response to President Donald Trump’s imposition of tariffs on it. (See DOE Warns About Further Increases of US LNG Exports.)
“We expect China’s imposition of tariffs on U.S. LNG to have a limited effect on U.S. LNG exports,” the Energy Information Administration said in its Short-Term Energy Outlook (STEO) for February. “With ample demand for LNG globally, we expect that any LNG not purchased by China would be imported elsewhere.”
In the conditional order approving the exports, DOE found they are likely to yield economic benefits to the U.S., diversify global LNG supplies, and improve energy security for U.S. allies.
DOE has approved a total of 46.88 Bcfd in exports of LNG from the Lower 48 states, with 39 final orders and the conditional order for Commonwealth. DOE expects to issue a final order later in 2025.
EIA expects LNG exports will record highs in 2025, averaging 15 Bcfd, but so will domestic production — hitting almost 105 Bcfd, it said in the STEO.
The outlook also noted that the very cold January contributed to higher natural gas price forecasts this year, adding 65 cents to the EIA’s 2025 average price forecast, which hit $3.80/MMBtu.
The Industrial Energy Consumers of America was the only group to protest the application on time, arguing that the additional exports would put upward pressure on domestic natural gas prices, making its members less competitive.
DOE responded that based on forecasts for high domestic production, the additional exports conditionally approved Feb. 14 would not increase prices in the U.S.
“With these decisions in hand, subject to a FERC final order, which we expect in July 2025, and DOE final authorization, Commonwealth anticipates reaching a final investment decision in September 2025, with first LNG production expected in Q1 2029,” said Commonwealth CEO Farhad Ahrabi.
