A US regulator proposed new rules on Wednesday to hasten liquefied natural gas projects and expand export capacity as part of the Trump administration’s larger push to speed up energy infrastructure development and cut costs for consumers.
The US is the world’s largest LNG exporter and expected to add another 100 million metric tons to its production by the end of the decade. LNG has been at the center of US President Donald Trump’s energy dominance agenda since his return to office. He ordered the resumption of LNG export approvals – something former President Joe Biden had paused – and also started to streamline the environmental approval process that previously slowed projects.
The latest rule, proposed by the Pipeline and Hazardous Materials Safety Administration (PHMSA), will help operators adopt new technologies to save costs and boost safety, US Transportation Secretary Sean Duffy said. Leveraging the technologies will generate $100 million in savings annually, he added.
LNG buyers globally have been seeking more diverse supply sourcing ever since the US-Israeli war against Iran cut off Gulf shipments, while Trump has championed the project as a way to boost national security and trade with partners.
The proposed rulemaking updates PHMSA’s safety framework for LNG facilities by incorporating National Fire Protection Association standards for the siting, design, construction, operation, and maintenance of LNG facilities.
“By overhauling these basic rules to embrace modern technologies, we can safely unleash America’s energy dominance, lower costs, and generate millions in economic opportunity for the men and women powering our energy sector,” Duffy said.
The Trump administration’s pro-energy stance has led to public announcements from the largest LNG exporters, including Cheniere and Venture Global LNG, that they will move forward with permitting as much LNG capacity as they think they can build because of permitting certainty under the Trump administration.
In the almost two years since the Trump administration took office there has been a wave of LNG projects in the US that announced a final investment decision, amounting to more than 50 million metric tons per annum. One of those is Delfin LNG, which is set to become the first US floating LNG export facility, but has not been publicly given the all-clear by PHMSA to operate the pipeline to take natural gas to the floating facility after an explosion earlier this year.
Even with the rule change, LNG project developers will still have to go through the Federal Energy Regulatory Commission permitting process, face constant legal challenges and get environmental approvals.
(Reporting by David Shepardson, Arathy Somasekhar and Curtis Williams in Houston; Editing by Liz Hampton and Jacqueline Wong)