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Notice2024-06703

Delfin LNG LLC; Request for Supplemental Order Granting Conditional Extension of Time for Long-Term Authorization To Export Liquefied Natural Gas

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Published

March 29, 2024

Issuing agencies

Energy Department

Abstract

The Office of Fossil Energy and Carbon Management (FECM) of the Department of Energy (DOE), formerly the Office of Fossil Energy (FE), gives notice (Notice) of receipt of a request (Request), filed by Delfin LNG LLC (Delfin) on March 1, 2024. Delfin requests a supplemental order modifying its authorization to export domestically produced liquefied natural gas (LNG) to non-free trade agreement countries set forth in DOE/FE Order No. 4028, as amended, to allow Delfin to commence export operations from the proposed Delfin Deepwater Port by no later than June 1, 2029--a five-year extension from its existing commencement deadline. Delfin proposes that this extension of time should be conditional, with Delfin required to meet the proposed conditions within a period of nine months. Delfin filed the Request under the Natural Gas Act (NGA) and pursuant to DOE's Policy Statement on Export Commencement Deadlines in Authorizations to Export Natural Gas to Non-Free Trade Agreement Countries. Protests, motions to intervene, notices of intervention, and written comments are invited.

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<title>Federal Register, Volume 89 Issue 62 (Friday, March 29, 2024)</title>
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[Federal Register Volume 89, Number 62 (Friday, March 29, 2024)]
[Notices]
[Pages 22137-22139]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-06703]

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DEPARTMENT OF ENERGY

[Docket No. 13-147-LNG]

Delfin LNG LLC; Request for Supplemental Order Granting
Conditional Extension of Time for Long-Term Authorization To Export
Liquefied Natural Gas

AGENCY: Office of Fossil Energy and Carbon Management, Department of
Energy.

ACTION: Notice of request.

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SUMMARY: The Office of Fossil Energy and Carbon Management (FECM) of
the Department of Energy (DOE), formerly the Office of Fossil Energy
(FE), gives notice (Notice) of receipt of a request (Request), filed by
Delfin LNG LLC (Delfin) on March 1, 2024. Delfin requests a
supplemental order modifying its authorization to export domestically
produced liquefied natural gas (LNG) to non-free trade agreement
countries set forth in DOE/FE Order No. 4028, as amended, to allow
Delfin to commence export operations from the proposed Delfin Deepwater
Port by no later than June 1, 2029--a five-year extension from its
existing commencement deadline. Delfin proposes that this extension of
time should be conditional, with Delfin required to meet the proposed
conditions within a period of nine months. Delfin filed the Request
under the Natural Gas Act (NGA) and pursuant to DOE's Policy Statement
on Export Commencement Deadlines in Authorizations to Export Natural
Gas to Non-Free Trade Agreement Countries. Protests, motions to
intervene, notices of intervention, and written comments are invited.

DATES: Protests, motions to intervene, or notices of intervention, as
applicable, and written comments are to be filed as detailed in the
Public Comment Procedures section no later than 4:30 p.m., eastern
time, April 29, 2024.

ADDRESSES:
Electronic Filing by email (Strongly encouraged):
<a href="/cdn-cgi/l/email-protection#56303324313725163e277832393378313920">[email&#160;protected]</a>.
Postal Mail, Hand Delivery, or Private Delivery Services (e.g.,
FedEx, UPS, etc.), U.S. Department of Energy (FE-34), Office of
Regulation, Analysis, and Engagement, Office of Fossil Energy and
Carbon Management, Forrestal Building, Room 3E-056, 1000 Independence
Avenue SW, Washington, DC 20585.
Due to potential delays in DOE's receipt and processing of mail
sent through the U.S. Postal Service, we encourage respondents to
submit filings electronically to ensure timely receipt.

FOR FURTHER INFORMATION CONTACT:

Jennifer Wade or Peri Ulrey, U.S. Department of Energy (FE-34), Office
of Regulation, Analysis, and Engagement, Office of Resource
Sustainability, Office of Fossil Energy and Carbon Management,
Forrestal Building, Room 3E-042, 1000 Independence Avenue SW,
Washington, DC 20585, (202) 586-4749 or (202) 586-7893,
<a href="/cdn-cgi/l/email-protection#751f101b1b1c1310075b02141110351d045b111a105b121a03">[email&#160;protected]</a> or <a href="/cdn-cgi/l/email-protection#136376617a3d667f61766a537b623d777c763d747c65">[email&#160;protected]</a>
Cassandra Bernstein, U.S. Department of Energy (GC-76), Office of the
Assistant General Counsel for Energy Delivery and Resilience, Forrestal
Building, Room 6D-033, 1000 Independence Avenue SW, Washington, DC
20585, (240) 780-1691, <a href="/cdn-cgi/l/email-protection#5635372525373832243778343324382522333f38163e277832393378313920">[email&#160;protected]</a>

SUPPLEMENTARY INFORMATION:

Background

On June 1, 2017, in DOE/FE Order No. 4028 (as amended),\1\ DOE
authorized Delfin to export domestically produced LNG by vessel from
the proposed Delfin

[[Page 22138]]

Liquefaction Project (Project), a floating liquefaction facility to be
located in the Gulf of Mexico off the coast of Cameron Parish,
Louisiana, to any country with which the United States has not entered
into a free trade agreement (FTA) requiring national treatment for
trade in natural gas, which currently has or in the future develops the
capacity to import LNG, and with which trade is not prohibited by U.S.
law or policy (non-FTA countries).\2\ Delfin is authorized to export
this LNG in a volume equivalent to 657.5 billion cubic feet per year of
natural gas for a term extending through December 31, 2050.\3\
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\1\ Delfin LNG LLC, DOE/FE Order No. 4028, Docket No. 13-147-LNG
(June 1, 2017), reh'g denied, Order No. 4028-A (Apr. 3, 2018),
amended by Order No. 4028-B (Dec. 10, 2020) (extending export term),
further amended by Order No. 4028-C (May 18, 2021) (correcting and
amending location of floating LNG vessels). In addition, Delfin's
export authorization was amended by DOE/FE Order No. 4641 (Dec. 18,
2020) to include short-term export authority on a non-additive
basis.
\2\ 15 U.S.C. 717b(a).
\3\ Delfin LNG LLC, DOE/FE Order No. 4028, as amended in Order
No. 4028-B (Ordering Para. A).
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Because Delfin's Project will be a ``deepwater port'' within the
meaning of the Deepwater Port Act of 1974, as amended (DWPA), 33 U.S.C.
1501 et seq., the Project requires a deepwater port license from the
U.S. Department of Transportation Maritime Administration (MARAD), in
conjunction with the U.S. Coast Guard.\4\ In the Request, Delfin
explains that, although it has received a favorable Record of Decision
from MARAD, it has been waiting for ``nearly two years'' for MARAD to
issue a final deepwater license authorizing the operation of Delfin's
offshore facilities.\5\
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\4\ For more information on MARAD's deepwater port licensing,
see Delfin LNG LLC, DOE/FE Order No. 4028, at 1-3, 126-35
(summarizing MARAD's process and Delfin's status at that time), 173
(Ordering Para. H), and Request at 5, 22-27.
\5\ See Request at 2, 22-26.
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Delfin's Project also involves certain onshore components that
required the authorization of the Federal Energy Regulatory Commission
(FERC), which Delfin received in 2017.\6\ Delfin states that, on
October 4, 2023, it obtained an extension from FERC of the deadline to
construct and place its onshore facilities into service--from September
28, 2023, to September 28, 2027.\7\
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\6\ For more information on FERC's jurisdiction over limited
onshore components of the Project, see Delfin LNG LLC, DOE/FE Order
No. 4028, at 2-3, 173 (Ordering Para. H), and Request at 6 n.9, 7
n.12, 8 n.13.
\7\ See Request at 6 n.9, 26-27 (citing Delfin LNG LLC, 185 FERC
] 61,009 (2023)).
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As relevant here, Order No. 4028 requires Delfin to ``commence
export operations using the planned liquefaction facilities no later
than seven years from the date of issuance of [the] Order''--i.e., by
June 1, 2024.\8\
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\8\ Delfin LNG LLC, DOE/FE Order No. 4028, at 173 (Ordering
Para. D). Additionally, Delfin asks DOE to amend its existing FTA
authorization (DOE/FE Order No. 3393, as amended). DOE will address
the FTA portion of the Request separately pursuant to NGA section
3(c), 15 U.S.C. 717b(c).
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Request for Conditional Extension

In its Request, Delfin asks DOE to issue a supplemental order that
would ``modify'' Order No. 4028 to provide Delfin a five-year
``conditional extension of time'' for Delfin to commence export
operations from the Project--from June 1, 2024, to June 1, 2029.\9\
Delfin states that this Request is consistent with DOE's Policy
Statement on Export Commencement Deadlines (Commencement Extension
Policy) issued on April 26, 2023.\10\
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\9\ Delfin LNG LLC, Request for Supplemental Order Granting
Conditional Extension of Time for Long-Term Authorizations to Export
Liquefied Natural Gas, Docket No. 13-147-LNG, at 32, 43 (Mar. 1,
2024) [hereinafter Request]. Delfin states that it is not seeking to
modify any other aspect of its Project or non-FTA authorization. See
id. at 2.
\10\ U.S. Dep't of Energy, Policy Statement on Export
Commencement Deadlines in Authorizations to Export Natural Gas to
Non-Free Trade Agreement Countries, 88 FR 25272 (Apr. 26, 2023),
<a href="https://www.energy.gov/sites/default/files/2023-06/Policy%20Statement%20on%20Export%20Commencement%20Deadlines%20in%20Authorizations%20to%20Export%20Natural%20Gas%20to%20Non-Free%20Trade%20Agreement%20Countries.pdf">https://www.energy.gov/sites/default/files/2023-06/Policy%20Statement%20on%20Export%20Commencement%20Deadlines%20in%20Authorizations%20to%20Export%20Natural%20Gas%20to%20Non-Free%20Trade%20Agreement%20Countries.pdf</a> [hereinafter Commencement
Extension Policy].
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Specifically, Delfin proposes that DOE ``grant only a conditional
extension that requires Delfin to certify by no later than nine (9)
months after DOE/FECM's order that it has: (1) obtained the final DWPA
license (to the extent that this has not occurred prior to DOE/FECM
granting the conditional extension); (2) secured necessary financing
arrangements to construct its first FLNGV [floating LNG vessel] and the
Deepwater Port; (3) made its positive FID [Final Investment Decision]
with respect to first FLNGV; and (4) issued an unconditional, full NTP
[Notice to Proceed] for first FLNGV to the EPCI [Engineering,
Procurement, Construction and Integration] contractor pursuant to the
binding, executed EPCI contract.'' \11\
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\11\ Request at 5; see also id. at 37.
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Delfin states that, although it ``is confident in its ability to
satisfy those conditions within the requested time period, should it
fail to do so then the export authorizations would expire at the end of
that period.'' \12\ Delfin further contends that ``imposition by DOE/
FECM of these conditions on the extension of time will eliminate soon
any uncertainty about the status of Delfin's project, providing
assurance to DOE (and all other stakeholders and interested observers)
that Delfin will actually commence LNG exports by the extended
deadline.'' \13\ Delfin thus asserts that its Request ``satisf[ies] the
objective of the Commencement Extension Policy of reducing the
`regulatory overhang' between authorized export volumes and projects
actually moving forward.'' \14\
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\12\ Id. at 5.
\13\ Id. at 5-6.
\14\ Id. at 6.
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In support of its Request, Delfin asserts that good cause exists to
grant the requested conditional extension of time, and that Delfin's
authorized exports remain in the public interest. Delfin also states
that it meets the criteria established by DOE in the Commencement
Extension Policy for such requests. Specifically, Delfin argues that
its Project ``has been delayed by a series of extenuating circumstances
outside its control,'' \15\ and that ``[m]uch of the infrastructure for
[the Project] has already been constructed and is in existence, namely
the large offshore natural gas pipelines that will transport feed gas
to the FLNGVs.'' \16\
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\15\ Id. at 3-4 (citing, e.g., ``the continuing evolution of
FLNGV technology requiring a series of refinements of the project,
complications related to trade with China, the impacts of the COVID-
19 epidemic, the related slowdown in market demand for LNG, and
significant challenges with the MARAD licensing process'').
\16\ Request at 4; see also id. at 11-16.
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Additionally, Delfin distinguishes its floating offshore Project
from ``the land-based LNG export projects holding all other non-FTA
authorizations.'' \17\ Delfin states that ``the key part'' of its
Project, the FLNGVs, ``will be constructed in existing shipyards
overseas.'' \18\ Delfin describes both its commercial progress to date
for the FLNGV construction and the remaining steps needed to reach
FID.\19\
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\17\ Id. at 4.
\18\ Id.
\19\ Id. at 4, 16-22, 27-31.
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Delfin states that, because it is not requesting an extension of
its export term under Order No. 4028, as amended (which ends on
December 31, 2050), or an increase in its authorized export volume,
``the result of the extension will be that Delfin will have five years
fewer to export LNG for a significant decrease in the total volumes of
LNG exports under the authorization than was previously authorized.''
\20\
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\20\ Id. at 33.
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Finally, Delfin asks DOE to grant the Request by its existing
export commencement deadline of June 1, 2024. If DOE is unable to act
on the Request by this date, Delfin asks DOE to ``toll'' the existing
June 1, 2024, export commencement deadline in Order No. 4028 in light
of the pending Request, so that ``the existing non-FTA authorization
would not expire and DOE/FECM could subsequently grant the conditional
extension

[[Page 22139]]

notwithstanding passage of the pre-existing deadline.'' \21\
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\21\ Request at 6.
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Additional details can be found in the Request, posted on the DOE
website at: <a href="http://www.energy.gov/sites/default/files/2024-03/Delfin%20DOE%20Extension%20request%20%28030124%20FINAL%29.pdf">www.energy.gov/sites/default/files/2024-03/Delfin%20DOE%20Extension%20request%20%28030124%20FINAL%29.pdf</a>.

DOE Evaluation

In reviewing Delfin's Request, DOE will consider any issues
required by law or policy under NGA section 3(a), DOE's regulations,
DOE's Commencement Extension Policy, and any other documents deemed
appropriate.
Parties that may oppose the Request should address these issues and
documents in their comments and/or protests, as well as other issues
deemed relevant to the Request.
The National Environmental Policy Act (NEPA), 42 U.S.C. 4321 et
seq., requires DOE to give appropriate consideration to the
environmental effects of its proposed decisions. No final decision will
be issued in this proceeding until DOE has met its environmental
responsibilities.

Public Comment Procedures

In response to this Notice, any person may file a protest,
comments, or a motion to intervene or notice of intervention, as
applicable, addressing the Request. Interested parties will be provided
30 days from the date of publication of this Notice in which to submit
comments, protests, motions to intervene, or notices of intervention.
The public previously was given an opportunity to intervene in,
protest, and comment on Delfin's non-FTA application in Docket No. 13-
147-LNG.\22\ Therefore, DOE will not consider comments or protests that
do not bear directly on this Request.
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\22\ See supra note 1.
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Any person wishing to become a party to this proceeding evaluating
Delfin's Request must file a motion to intervene or notice of
intervention.\23\ The filing of comments or a protest with respect to
the Request will not serve to make the commenter or protestant a party
to this proceeding, although protests and comments received from
persons who are not parties will be considered in determining the
appropriate action to be taken on the Request. All protests, comments,
motions to intervene, or notices of intervention must meet the
requirements specified by the regulations in 10 CFR part 590, including
the service requirements.
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\23\ Status as an intervenor in prior proceeding(s) in this
docket does not continue to this proceeding evaluating Delfin's
Request, and therefore any person interested in intervening to
address the Request must file a new motion to intervene (or notice
of intervention, as applicable). 10 CFR 590.303.
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Filings may be submitted using one of the following methods:
(1) Submitting the filing electronically at <a href="/cdn-cgi/l/email-protection#f4929186939587b49c85da909b91da939b82">[email&#160;protected]</a>;
(2) Mailing the filing to the Office of Regulation, Analysis, and
Engagement at the address listed in the ADDRESSES section; or
(3) Hand delivering the filing to the Office of Regulation,
Analysis, and Engagement at the address listed in the ADDRESSES
section.
For administrative efficiency, DOE prefers filings to be filed
electronically. All filings must include a reference to ``Docket No.
13-147-LNG'' or ``Delfin LNG LLC Request'' in the title line.
For electronic submissions: Please include all related documents
and attachments (e.g., exhibits) in the original email correspondence.
Please do not include any active hyperlinks or password protection in
any of the documents or attachments related to the filing. All
electronic filings submitted to DOE must follow these guidelines to
ensure that all documents are filed in a timely manner.
The Request, and any filed protests, motions to intervene, notices
of intervention, and comments will be available electronically on the
DOE website at <a href="http://www.energy.gov/fecm/regulation">www.energy.gov/fecm/regulation</a>.
A decisional record on the Request will be developed through
responses to this Notice by parties, including the parties' written
comments and replies thereto. Additional procedures will be used as
necessary to achieve a complete understanding of the facts and issues.
If an additional procedure is scheduled, notice will be provided to all
parties. If no party requests additional procedures, a final Order may
be issued based on the official record, including the Request and
responses filed by parties pursuant to this Notice, in accordance with
10 CFR 590.316.

Signed in Washington, DC, on March 25, 2024.
Amy Sweeney,
Director, Office of Regulation, Analysis, and Engagement, Office of
Resource Sustainability.
[FR Doc. 2024-06703 Filed 3-28-24; 8:45 am]
BILLING CODE 6450-01-P

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