API Files Application for Rehearing on LNG Freeze

WASHINGTON, February 26, 2024 – The American Petroleum Institute (API) today filed an application for rehearing on the Department of Energy’s (DOE) indefinite pause on new and pending liquefied natural gas (LNG) permit approvals for non-FTA countries. In the legal filing submitted to DOE, API argued the pause is unlawful, violating both the Natural Gas Act and the Administrative Procedure Act, and that it erodes America’s energy advantage by threatening U.S. jobs, national security and environmental progress. 

“At a time of geopolitical turmoil around the world, the Department of Energy's arbitrary LNG freeze is not only unlawful – it cedes America’s energy advantage to hostile nations while jeopardizing thousands of American jobs,” API Vice President of Natural Gas Markets Rob Jennings said. “U.S. LNG is a cornerstone of global energy security, and its benefits – which include bolstering the American economy, reducing global emissions and strengthening our national security – are well-established. There is bipartisan recognition that this move is political, and we will continue to take any steps necessary to resume American leadership on LNG.”

In the filing, API argues that DOE’s pause contradicts the clear mandate of the Natural Gas Act for DOE to issue LNG export permits to non-FTA countries absent a finding that it is not in the public interest. The indefinite pause also violates the Administrative Procedure Act’s requirement for DOE to act “within a reasonable time.” API went on criticize the LNG export pause as “arbitrary and capricious,” highlighting DOE’s failure to provide a justification for changing its longstanding position. API noted that DOE implemented the pause without prior notice or the ability to comment as required by the Administrative Procedure Act. 

In 2022, the U.S. fed its domestic markets while sending more than 800 LNG cargoes to Europe – a 141% increase from 2021 – to help blunt the impact of Russia’s weaponization of its energy supplies. Recent studies show that Europe and Asia face potential long-term natural gas supply gaps threatening their energy security.

American consumers benefit from among the lowest natural gas prices in the world, according to the International Energy Agency (IEA). While U.S. LNG exports reached record highs in 2023, domestic prices declined 62% from the previous year as U.S. natural gas production also grew to record levels—demonstrating our ability to meet rising global demand for natural gas while maintaining a well-supplied domestic market.

Coal-to-natural gas switching is the main reason that the U.S. has led the world in reducing CO2 emissions over the past two decades. Global coal consumption continues to significantly grow, reaching another all-time high in 2023. By 2024, three out of every four tons of coal consumed will occur in China, India and Southeast Asia. By displacing higher-emitting fuels like coal, U.S. LNG can help these nations replicate America’s emissions reductions success story. 

In the U.S., the natural gas and oil industry supports 10.8 million jobs and contributes $1.8 trillion to the U.S. economy. LNG exports are a critical part of the natural gas value chain, supporting jobs from production facilities in Pennsylvania and New Mexico to pipeline operations Ohio and West Virgina to export and liquefaction facilities in Texas and Louisiana. 

Read the full filing here. 

API represents all segments of America’s natural gas and oil industry, which supports nearly 11 million U.S. jobs and is backed by a growing grassroots movement of millions of Americans. Our approximately 600 members produce, process and distribute the majority of the nation’s energy, and participate in API Energy Excellence®, which is accelerating environmental and safety progress by fostering new technologies and transparent reporting. API was formed in 1919 as a standards-setting organization and has developed more than 800 standards to enhance operational and environmental safety, efficiency and sustainability.

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