Court Denies Sierra Club Appeals of Freeport LNG and Sabine Pass LNG Orders

 

The U.S. Court of Appeals for the D.C. Circuit has issued two opinions denying (1) Sierra Club’s and Galveston Baykeeper’s challenges to FERC orders authorizing Freeport LNG Development, L.P. to construct and operate LNG export terminal facilities at its LNG import terminal on Quintana Island in Brazoria County, Texas, and (2) Sierra Club’s challenges to FERC orders authorizing Sabine Pass LNG to increase the liquefaction capacity at its proposed LNG export terminal in Cameron Parish, La. from 16 to 20 million tons per year.  In the opinions, among other things, the Court rejected the Petitioners’ arguments that FERC’s environmental analyses of the projects were inadequate because they did not consider the environmental effects caused by the increase in domestic natural gas production that would be induced by approval of the export projects.  The Court ruled that FERC was not required to address the indirect effects of the anticipated export of natural gas because the Department of Energy, not FERC, has sole authority to license the export of any natural gas going through the project facilities.  The Court also rejected Petitioners’ arguments that FERC should have conducted a nationwide analysis of the cumulative environmental impacts for several other proposed and approved LNG export terminal projects, finding that the environmental analyses need only cover projects in the same geographic area as the project under review.