HIGHLIGHTS:

  • On Oct. 16, 2014, the Maritime Administration (MARAD) issued a notice in the Federal Register seeking public comments on proposed policies regarding the review and processing of applications for the export of oil and natural gas from offshore deepwater port facilities under the DWPA.  
  • The proposed policy indicates that MARAD will use the existing licensing framework and regulations provided at 33 CFR Parts 148, 149 and 150 to evaluate and process export license applications and clarifies the regulatory requirements for converting import facilities to export facilities.

On Oct. 16, 2014, the Maritime Administration (MARAD) issued a notice in the Federal Register seeking public comments on proposed policies regarding the review and processing of applications for the export of oil and natural gas from offshore deepwater port facilities under the Deepwater Port Act of 1974 (DWPA).  

The DWPA is the federal law governing the licensing and operation of offshore facilities used to import or export oil or natural gas (usually in the form of liquefied natural gas (LNG)). While MARAD's authority to approve deepwater port projects was initially limited to import facilities, the Coast Guard and Maritime Transportation Act of 2012 amended the definition of Deepwater Port to include shipments "from" any state. This legislative change authorized MARAD to license export facilities, such as floating liquefaction units, located in federal waters (the Federal Energy Regulatory Commission (FERC) retains jurisdiction over near-shore facilities located in state waters under the Natural Gas Act).

Among other things, the proposed policy restates the joint review responsibilities of the Coast Guard and MARAD. It reaffirms the Coast Guard’s role as the lead agency for National Environmental Policy Act (NEPA) review and compliance, navigation safety, and engineering and facility safety standards, as well as MARAD's responsibilities to determine the citizenship and financial capability of license applicants, prepare Records of Decision, and issue or deny licenses.

The proposed policy indicates that MARAD will use the existing licensing framework and regulations provided at 33 CFR Parts 148, 149 and 150 to evaluate and process export license applications. The proposed policy statement also clarifies the requirements for converting existing import facilities to export facilities, including NEPA review and programmatic requirements such as submission of revised operations manuals. In addition, the proposed policy clarifies that if a project proponent with an application currently under review proposes to convert from import to export operations, the submission of a new application will be required.

MARAD is accepting public comments on the notice until Dec. 15, 2014. It is also important to note that the Coast Guard is currently in the process of preparing a proposed rulemaking to provide clarifying and other amendments to the Deepwater Port regulations at 33 CFR Parts 148, 149, and 150, which is currently under review at the Office of Management and Budget (OMB) and is expected to be issued soon for public comment.