Oxford – What next for US LNG Exports

The Biden administration has temporarily paused the approval of exports from new liquefied natural gas (LNG) projects. The US Department of Energy (DOE) has announced that it will update the assessments used to determine whether additional LNG exports are in the public interest. This update will consider various factors, including market conditions, national security, environmental impacts, and energy security. While the pause will not affect already authorized exports, it will delay the approval of pending applications for LNG exports to non-Free Trade Agreement countries. The DOE is responsible for authorizing gas trade based on the public interest. For countries with which the US has a free trade agreement, approval is automatic. However, for non-FTA countries, the DOE must grant export authority unless it determines that the proposed exports are not consistent with the public interest or are prohibited by law or policy. The Biden administration's decision to pause LNG exports is seen as a response to pressure from environmental groups and the left of the Democratic Party. It is seen as a political move and may require amending DOE procedures to consider wider environmental and climate change factors. While no executive order has been issued, it is anticipated that more clarification will be provided in the coming weeks or months. As a result of this pause, pending applications for LNG exports are unlikely to be approved until after the presidential election or even after the new president's inauguration in January 2025.