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Delfin also contends that LNG exports will have only a modest impact on natural gas
prices, and argues that DOE/FE has repeatedly rejected the protestors’ claims that the 2012 LNG
Export Study is unreliable. Delfin points out that DOE/FE has verified the soundness of the
2012 LNG Export Study, and that other independent analyses of the impact of LNG exports on
domestic natural gas prices have found very modest price effects. Delfin states that the 2013 and
2014 Annual Energy Outlooks and the 2014 NERA study all conclude that current projections of
domestic supply and demand conditions are more, not less, favorable to LNG exports than
previously thought. Delfin also asserts that any modest price increases from current low price
levels would still leave natural gas prices lower than they have been historically, and would only
serve to bring the U.S. natural gas markets back into equilibrium.
Delfin rejects APGA’s argument that the United States cannot tolerate a high volume of
LNG exports, based on the total volume of LNG exports requested in pending applications to
DOE/FE. Delfin states that, in reality, the number of LNG export applications has very little
bearing on the economic impact of LNG exports, due to the significant expenses and regulatory
barriers involved in exporting LNG.
Delfin concludes that the flaws in the protestors’ economic arguments are evident
because they could be applied regardless of the source of new natural gas demand—foreign or
domestic, LNG-related or not. Delfin asserts that the protestors’ argument is that LNG exports
are contrary to the public interest simply because they will increase the demand for natural gas.
Delfin urges DOE/FE to reject this argument, as it has to date.
3.
Sierra Club’s NEPA Arguments Are Inapplicable
Delfin urges DOE/FE to reject Sierra Club’s arguments outright, stating that Sierra
Club’s comments are essentially identical to comments Sierra Club has filed in virtually every
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LNG export proceeding, as well as in numerous other natural gas infrastructure cases. More
specifically, Delfin argues that a generalized consideration of shale well drilling techniques is not
required by NEPA because it is not a reasonably foreseeable or causally related action, among
other reasons. Delfin also contends that its Facility will be unique (as compared to onshore LNG
terminals) in that it will not require significant disturbance of land, will maximize use of existing
infrastructure, and will rely on existing processing facilities currently underutilized—rendering
Sierra Club’s environmental arguments even less applicable to this proceeding.
Delfin asserts that DOE/FE should reject Sierra Club’s NEPA arguments because such
matters are not presently before DOE. Delfin states that MARAD and USCG have exclusive
jurisdiction over the siting, construction, and operation of Delfin’s Project, and are the lead
agencies for purposes of conducting the environmental analysis required here by NEPA. Delfin
states that while it anticipates DOE/FE will participate as a cooperating agency, Sierra Club’s
NEPA arguments, including its call for a programmatic EIS, are being made prematurely and
before the wrong agency.
Delfin also argues that NEPA does not require consideration of upstream shale gas
development. Delfin states that DOE/FE has already held that shale well development effects
are not required to be considered under NEPA for LNG export projects, and argues such
development is not a “reasonably foreseeable” effect of Delfin’s proposed exports. Delfin also
notes that DOE/FE, FERC, and the courts have consistently rejected Sierra Club’s arguments in
this regard.
4.
U.S. Geopolitical Interests Will Be Advanced
Delfin rejects V4EI’s claims that its proposed exports pose a threat to U.S. security and
will increase the likelihood of military conflict globally. Delfin contends that V4EI’s claims that
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exports of LNG from Delfin’s proposed Facility would increase the potential for armed conflict
are flatly untrue and have been rejected by relevant experts. To the contrary, Delfin argues, the
proposed exports will provide significant geopolitical benefits to the United States, its allies, and
its trading partners, as DOE/FE has found in other LNG export orders. Additionally, Delfin
argues that APGA’s desire to put foreign trade last is contrary to U.S. geopolitical interests.
According to Delfin, APGA seeks to invoke a protectionist policy that will harm all U.S.
businesses who participate in the global marketplace, including manufacturers.
G.
Sierra Club’s Renewed Motion to Reply and Reply
Sierra Club filed a Renewed Motion to Reply and Reply on June 27, 2014. Sierra Club
contends that the public interest test set forth in NGA section 3(a) requires DOE/FE to conduct a
“searching” public interest inquiry that fully considers Sierra Club’s environmental
arguments.
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Sierra Club maintains that Delfin’s Answer to the Protests misstates important
questions of fact and law that bear on the public interest, and Sierra Club should therefore be
granted leave to reply.
Sierra Club agrees with Delfin’s contention that some of the issues raised by Sierra Club
in this proceeding are similar to those it has raised in other proceedings, but states that Delfin’s
proposed exports will cause “additional, marginal injuries” to Sierra Club’s members.
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Sierra
Club maintains that these additional injuries, combined with Sierra Club’s desire to preserve its
right to seek judicial review, justifies its ability to intervene here.
Sierra Club reasserts the position set forth in its motion that DOE/FE must consider
environmental impacts, including induced production of natural gas. Sierra Club argues that
DOE/FE must act to prevent environmental harm associated with induced natural gas production
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Sierra Club Renewed Mot. at 1.
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Id. at 2.
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