New US administration resumes issuing LNG export permits

The Trump administration announced that it had conditionally authorized exports of liquefied natural gas (LNG) from a huge project in Louisiana. It is the first new LNG export authorization since former President Joe Biden suspended the issuance of these licenses a year ago.

Commonwealth LNG, which has been waiting for authorization longer than any other company, wants to build an export terminal in Louisiana with a capacity of 9.5 million tonnes of LNG per year. It would sell the liquefied gas to countries that do not have a free trade agreement with the US. In that case, the project needs federal government approval.

Last Friday, the administration of US President Donald Trump announced that it would grant the project a license to export liquefied natural gas. It is the first approval for LNG exports since former President Joe Biden suspended approvals early last year, although it is still conditional. Exports have been approved for markets in Asia and Europe.

Trump ordered the freeze on LNG export approvals to be lifted on the day he took office for a second time, January 20. Reuters reports.

Economy comes first

Energy Secretary Chris Wright, whose department is responsible for approving shipments, said that US LNG exports “strengthen the US economy and support American jobs while also bolstering energy security around the world”.

The US is seeking to increase LNG exports and fill the gap created by Europe’s efforts to reduce its share of Russian gas supplies.

Commonwealth LNG, owned by Kimmeridge Texas Gas, welcomed the administration’s move, saying in a statement that it “shows that President Trump is putting the American energy industry first”, the AP reports.

The approval granted by Wright is subject to a final decision by the independent Federal Energy Regulatory Commission, but the company said it is confident the commission will approve the project this summer.

LNG exports to double

The company expects to make a final investment decision in September 2025, following the license and subject to regulatory approval. Commonwealth expects the first LNG deliveries from the project in early 2029.

US LNG exports are expected to double by the end of the decade, based on approvals granted before Biden’s pause.

Two other LNG trading companies, Cheniere and Energy Transfer, said they plan to move ahead with their LNG export plans in full.

Environmentalists, however, are concerned that the LNG export boom could increase carbon dioxide emissions, while some manufacturers and fuel-dependent industries fear it could push up domestic gas prices.

Trump also signed an executive order in the Oval Office on Friday to create a new energy council, led by Interior Secretary Doug Burgum, which will seek to expand oil and gas production in the US. The US is already the world’s largest producer of these fossil fuels.

Projects to be revived?

President Trump commented on how he plans to boost production, saying that more than 600 million acres of federal offshore waters are now open to oil and natural gas development after Biden took them off the table.

Trump said he is working to approve the Constitution Pipeline, which would carry gas from Pennsylvania’s production fields to New York to lower energy prices in the region.

The company cancelled the project in 2020 after opposition from politicians and environmentalists in New York, and it is unclear how it could be approved.

“The company has stopped investing in the proposed Constitution project. Although Constitution has achieved positive results in recent court proceedings and permit applications, the underlying risk-adjusted return of this greenfield pipeline project has declined to such an extent that further development is no longer supported,”said Williams, which had planned to invest in the pipeline.