150
of natural gas. Unlike DOE, environmental regulators have the legal authority to
impose
requirements on natural gas production that appropriately balance benefits and burdens, and to
update these regulations from time to time as technological practices and scientific understanding
evolve. For example, in 2012, using its authority under the Clean Air Act, EPA promulgated
regulations for hydraulically fractured wells that are expected to yield significant emissions
reductions.
343
In 2013, EPA updated those regulations to include storage tanks,
344
and in 2014
EPA issued a series of technical white papers exploring the potential need for additional
measures to address methane emissions from the oil and gas sector.
345
In January 2015, EPA
announced a strategy for “address[ing] methane and smog-forming VOC emissions from
the oil
and gas industry in order to ensure continued, safe and responsible growth in U.S. oil and natural
gas production.”
346
Specifically, EPA has initiated a rulemaking to set standards for methane
and VOC emissions from new and modified oil and gas production sources, and
natural gas
processing and transmission sources.
347
EPA issued the proposed rule in September 2015,
348
and
the final rule on June 3, 2016.
349
343
U.S. Envtl. Prot. Agency, Oil and Natural Gas Sector: New Source Performance
Standards and National
Emission Standards for Hazardous Air Pollutants Reviews; Final Rule, 77 Fed. Reg. 49,490 (Aug. 16, 2012).
344
U.S. Envtl. Prot. Agency, Oil and Natural Gas Sector: Reconsideration of Certain Provisions of New Source
Performance Standards; Final Rule, 78 Fed. Reg. 58,416 (Sept. 23, 2013).
345
U.S. Envtl. Prot. Agency, Fact Sheet: EPA’s Strategy for Reducing Methane and Ozone-Forming Pollution From
the Oil and Natural Gas Industry (Jan. 14, 2015),
available at:
https://www.epa.gov/newsreleases/fact-sheet-epas-strategy-reducing-methane-and-ozone-forming-pollution-oil-and-
natural
.
346
Id.
347
The White House, Office of the Press Secretary, Fact Sheet: Administration Takes Steps Forward on Climate
Action Plan by Announcing Actions to Cut Methane Emissions (Jan. 14, 2015),
available at
https://www.whitehouse.gov/the-press-office/2015/01/14/fact-sheet-administration-takes-steps-forward-climate-
action-plan-anno-1
(stating that, in developing the proposed and final standards, EPA “will focus on in-use
technologies, current industry practices, [and] emerging innovations … to ensure that emissions reductions can be
achieved as oil and gas production and operations continue to grow.”).
348
See U.S. Environmental Protection Agency, Oil and Natural Gas Sector: Emission Standards for New and
Modified Sources, Proposed Rule, 80 Fed. Reg. 56,593 (Sept. 18, 2015). EPA subsequently extended the public
comment period on this proposed rule and two related proposed rules until December 4, 2015.
See 80 Fed. Reg.
70,719 (Nov. 13, 2015).
349
See supra note 263.
151
Section 3(a) of the NGA is too blunt an instrument to
address these environmental
concerns efficiently. A decision to prohibit exports of natural gas would cause the United States
to forego entirely the economic and international benefits discussed herein, but would have little
more than a modest, incremental impact on the environmental issues identified by intervenors.
For these reasons, we conclude that the environmental concerns associated with natural gas
production do not establish that exports of natural gas to non-FTA nations are inconsistent with
the public interest.
5.
Compliance with the Endangered Species Act
To comply with the Endangered Species Act (ESA), the final EIS adopted by MARAD
reflected input from National Marine Fisheries Service (NMFS) under the Endangered Species
Act (ESA) Section 7 consultation process on the impacts of Delfin’s proposed
Port on threatened
and endangered species and designated critical habitat.
350
NMFS concurred with MARAD’s
determination of effects on listed species and designated critical habitat, and indicated that all
potential project effects were found to be discountable or insignificant. On this basis, NMFS
found that “‘the proposed action is not likely to adversely affect listed species under NMFS’
purview,’” and therefore “‘consultation responsibilities under ESA for species under NMFS’
purview [are] concluded.’”
351
Sierra Club argues in the current proceeding that DOE/FE must conduct a broader inquiry
to comply with ESA. Specifically, it contends that “DOE/FE must consider not just species
impacts at the proposed project site (although it must at least do that), but the effects of increased
gas production across the full region the terminal affects.”
352
These arguments echo those that it
350
See MARAD ROD at 46-47.
351
See id. at 46 (citation omitted).
352
Sierra Club Mot. at 10.
152
makes in support of a broader scope
for NEPA review,
i.e. the proposal to export LNG, if
granted, will impact a wide area due to induced natural gas production activities. DOE need not
repeat its arguments with respect to the appropriate scope of review over indirect effects except
to observe that conducting a wider regional or national consultation regarding species impacts
would add greatly to the burden of acting on applications to export natural gas to non-FTA
countries. Moreover, the inability to predict at a local level the volumes of induced natural gas
production would make such ESA analysis more speculative than informative. The scope of
review undertaken by MARAD in the EIS was properly limited to reasonably foreseeable
impacts of the proposed Delfin Liquefaction Facility and its use for the export of LNG.
Accordingly, we reject Sierra Club’s arguments in respect to the scope of ESA review.
6.
Greenhouse Gas Impacts Associated with U.S. LNG Exports
Sierra Club and other commenters on the LCA GHG Report, the Addendum, and the
2014 and 2015 LNG Export Studies have expressed concern that exports of domestic natural gas
to non-FTA nations may impact the balance of global GHG emissions through
their impact
domestically on the price and availability of natural gas for electric generation and other uses.
They also have objected that exports of natural gas could have a negative effect on the GHG
intensity and total amount of energy consumed in foreign nations.
a.
Domestic Environmental Impacts Associated with Increased Natural
Gas Prices
To the extent exports of natural gas to non-FTA nations increase domestic natural gas
prices, those higher prices would be expected, all else equal, to reduce the use of natural gas in
the United States as compared to a future case in which exports to non-FTA exports were
prohibited. Within the U.S. electric generation sector, reduced demand for natural gas caused by
higher prices would be balanced by some combination of reduced electric generation overall