Developers of LNG Facilities Now Must Complete Pre-Filing Process

FERC recently implemented a rule that requires potential developers of new LNG terminals to begin pre-filing procedures at least six months before filing a formal application with FERC.  The pre-filing process had previously been optional, but becomes mandatory under the recently enacted Domenici-Barton Energy Policy Act of 2005 (EPAct 2005).  While EPAct 2005 prescribes the pre-filing process only for applicants for new LNG terminals, FERC's rule is more expansive.  In accordance with the agency's National Environmental Policy Act responsibility to consider the potential environmental effects of LNG facilities, FERC has applied the pre-filing requirements to applicants seeking to construct all of the jurisdictional facilities entailed by an LNG terminal, including regasification, storage, and pipelines.  In addition, since many of the same safety concerns that arise with new LNG facilities may also arise when existing LNG terminals are modified or expanded, FERC will apply the rule to applicants seeking to make changes whenever the proposed modifications involve significant state and local safety considerations that have not been previously addressed.

Applicants subject to the new rule must now submit to FERC as much detail about their proposed facilities as possible, including the proposed project's conceptual design and engineering features, and its potential environmental, security and safety impacts.  The applicant has a window of 180 days after FERC issues notice of the prospective applicant's initiation of the pre-filing process to file the formal application for authorization of the LNG facilities. 

Congress' stated intention in requiring FERC to implement this requirement is to encourage LNG developers to coordinate with state and local authorities to address safety and security considerations.  In furtherance of this goal, the rule requires applicants to submit to FERC the names of the relevant federal and state agencies and identify the agency selected by the governor of the state where the project would be located to consult with FERC on the project's potential consequences.  Applicants must also demonstrate that this state agency has been made aware of the applicant's intention to use the pre-filing process.  [Regulations Implementing Energy Policy Act of 2005; Pre-Filing Procedures for Review of LNG Terminals and Other Natural Gas Facilities; New Matter]