United States: LNG Update: Jordan Cove LNG Export Facility

In early December, the FERC denied requests for rehearing of its March 11, 2016 Order denying the applications of Jordan Cove Energy Project, L.P. ("Jordan Cove") to site, construct and operate an LNG export terminal in Coos Bay Oregon ("Jordan Cove LNG Terminal") and Pacific Connector Gas Pipeline, LP ("Pacific Connector") to construct and operate an approximately 232-mile interstate natural gas pipeline originating at the Oregon/California border and terminating at the Jordan Cove LNG Terminal ("Pacific Connector Pipeline").55

Under the Natural Gas Act, FERC authorizes the construction and operation of interstate natural gas pipelines and on-shore LNG terminals. FERC's March 11 Order surprised industry observers because it denied authorization for a proposed LNG export project for the first time since FERC began considering large-scale LNG export projects in 2012. FERC found Pacific Connector, which would supply natural gas from western Canada and the US Rocky Mountain region to the Jordan Cove LNG Terminal, failed to demonstrate a need for the Pacific Connector Pipeline outweighing the potential harm to the economic interests of landowners whose property rights might be taken by Pacific Connector's exercise of eminent domain. Having denied Pacific Connector's application, FERC also denied Jordan Cove's application because the Jordan Cove LNG Terminal is not feasible without a pipeline to transport natural gas to the terminal.56

Pacific Connector and Jordan Cove filed requests for rehearing of FERC's March 11 Order, as did the State of Wyoming and the Wyoming Pipeline Authority.

Pacific Connector and Jordan Cove asked FERC to stay the March 11 Order and reopen the record to permit the submission of two long-term agreements executed by Jordan Cove for the export of LNG from the Jordan Cove LNG Terminal, and three precedent agreements for long-term transportation service executed by Pacific Connector. According to Jordan Cove, the agreements executed by Pacific Connector together accounted for 77 percent of the capacity of the Pacific Connector Pipeline. Pacific Connector and Jordan Cove argued that the agreements, which were executed after FERC issued the March 11 Order, are sufficient evidence of market need to support approval of the Pacific Connector Pipeline and the Jordan Cove LNG Terminal.

In its joint request for rehearing, Wyoming argued that in the March 11 Order, FERC failed to consider the benefits of the Pacific Connector Pipeline to the Wyoming economy and should have allowed Pacific Connector and Jordan Cove more time to demonstrate market support for the Pacific Connector Pipeline and the Jordan Cove LNG Terminal.

In its December 9 Order, FERC denied the requests to reopen the record and denied rehearing of the March 11 Order. FERC held that Pacific Connector and Jordan Cove had failed to demonstrate "extraordinary circumstances" to support reopening the record over the need for finality in FERC's decisions. FERC observed that before filing its rehearing request, Pacific Connector had every opportunity to demonstrate market need for the Pacific Connector Pipeline, but had failed to do so over a three-and-a-half-year period, during which FERC staff had issued four data requests seeking such information.

FERC stated that under its policy for authorizing interstate natural gas pipeline projects, Pacific Connector could have relied on a variety of relevant factors to demonstrate need, including precedent agreements, demand projections, potential cost savings to consumers or a comparison of projected demand with the amount of capacity currently serving the market. However, Pacific Connector failed to show any evidence of market demand for its project that would satisfy the factors listed in the Certificate Policy Statement.

FERC reiterated that its denial of Pacific Connector's certificate application is "without prejudice to Jordan Cove and/or Pacific Connector submitting a new application . . . should the companies show a market need for these services in the future." FERC expressed its concern that Pacific Connector and Jordan Cove submitted evidence of market demand within 30 days of the March 11 Order, yet failed to provide such evidence after receiving four data requests during a three-and-a- half-year period. FERC stated that it "expects that the Applicants will submit evidence of market need as part of their initial application, or in a timely manner in response to staff data requests, so that the Commission can appropriately consider such evidence as part of the certificate application."

Wyoming argued that FERC should have considered the benefits of the Pacific Connector Project on the State of Wyoming, including increased natural gas production, employment and tax and royalty income. In response to Wyoming's arguments on rehearing, FERC stated that generalized claims of need for the Pacific Connector Pipeline, including a generalized statement of benefits to Wyoming, do not outweigh the risk of Pacific Connector's exercise of eminent domain on landowners and communities. FERC also found that the issue of whether the export of LNG from the Jordan Cove LNG Terminal will cause economic harm or benefit is not within the purview of FERC in determining whether to authorize pipeline facilities under the Natural Gas Act.

Pacific Connector, Jordan Cove and Wyoming have the right to seek judicial review of FERC's orders. However, on December 15, Jordan Cove announced in a press release that it will file a new application for the Pacific Connector Pipeline and the Jordan Cove LNG Terminal. When it does, it may not be starting from square one with respect to environmental review of the projects. In the December 9 Order, FERC indicated that it "may use portions of the existing record, i.e. the September 2015 Final Environmental Impact Statement, to process that filing."57

Pacific Connector and Jordan Cove may have reason to be optimistic about the reception their new application will receive after January 20, 2017. Since becoming President on January 20, Donald Trump has the ability over the next several months to appoint four new FERC commissioners, including three from his party, and to designate the new FERC Chairman from among those new commissioners. In a September 22, 2016 speech in Pittsburgh, then-Republican presidential candidate Trump claimed that the Obama Administration had "blocked or abandoned" several energy transportation projects, including "a $6.8 billion liquid natural gas export facility," presumably a reference to FERC's denial of authorization for the Jordan Cove LNG Terminal and the Pacific Connector Pipeline.

Jordan Cove and Pacific Connector have not indicated when they will file a new application with FERC. However, with the resignation of former FERC Chairman Norman Bay as of February 3, 2017, FERC will now have only two commissioners and, consequently, does not have a quorum necessary to vote on proposed orders. FERC will not have the ability to act on a new application filed by Jordan Cove and Pacific Connector until President Trump nominates, and the Senate confirms, at least one new FERC commissioner.


55. Jordan Cove Energy Project, L.P., et al., "Order Denying Rehearing," 157 FERC ¶ 61,194 (2016) ("December 9 Order").

56. Jordan Cove Energy Project, L.P., and Pacific Connector Gas Pipeline, LP, "Order Denying Applications for Certificate and Section 3 Authorization," 154 FERC ¶ 61,190 (2016) ("March 11 Order").

57. December 9 Order at n.28.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Akin Gump Strauss Hauer & Feld LLP
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Akin Gump Strauss Hauer & Feld LLP
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions