Port Arthur LNG Phase 2 Marks Resumption of Federal Permitting

The Department of Energy (DOE) has granted the second phase of Port Arthur LNG, a Sempra project in Texas, a permit to export liquefied natural gas (LNG) to countries with no free trade agreement (FTA) with the United States.

“This is the first final LNG export approval under President Trump’s leadership and marks another step in restoring regular order to LNG export permitting – reversing the previous administration’s pause and delivering on the President’s pledge to unleash American energy”, the DOE said in an online statement.

Port Arthur LNG phase 2, which will consist of trains 3 and 4, is now permitted to export the equivalent of 698 billion cubic feet a year of gas, or about 13.5 million metric tons per annum (MMtpa) of LNG according to Sempra, to FTA and non-FTA countries on a non-additive basis until 2050, according to an order published on the DOE’s website. Sempra received the FTA portion of the permit July 2020.

“The project can be a key contributor to further establishing the U.S. as a leader in global energy markets, supporting U.S. trade goals and providing economic opportunity at the local, state and national levels in the U.S”, Sempra Infrastructure chief executive Justin Bird said in a separate press release.

Sempra is seeking offtakers for phase 2 and has yet to make a final investment decision. Earlier this month Sempra and Saudi Arabian Oil Co. (Aramco) progressed a heads of agreement on phase 2 into a memorandum of understanding (MOU) under which the state-owned oil giant plans to purchase five MMtpa for 20 years. The MOU also provides for Aramco’s potential acquisition of a 25 percent stake.

The under-construction phase 1, which consists of trains 1 and 2, had received a permit to export the same volume to FTA and non-FTA countries until 2050. Sempra expects to start up trains 1 and 2 in 2027 and 2028 respectively.

“Future phases are also in the early development stage”, Sempra said.

The DOE said it has now issued 40 final and two conditional export approvals for projects in the Lower 48, or the contiguous U.S. These permits involve a total of 19.3 trillion cubic feet a year of gas.

On May 19 the DOE announced it would proceed with issuing final orders on pending applications to export LNG to non-FTA nations after concluding a Biden-era study that sought to review permitting considerations.

On January 21 Donald Trump, upon taking office in his second nonconsecutive term as president, lifted his predecessor’s LNG export pause, imposed around the same time last year. The DOE under Biden had said the pause would give it time to review permitting considerations involving greenhouse gas emissions, environmental impact, energy prices and domestic gas supply.

“Based on the record evidence from the 2024 LNG Export Study and the public comments received, DOE makes several key findings, including: the United States has a robust natural gas supply that is sufficient to meet growing levels of exports while minimizing impacts to domestic prices; growing LNG exports increases our gross domestic product and expands jobs while improving our trade balance; and increasing U.S. LNG exports enhances domestic and international global security with no discernable impact to global greenhouse gas emissions”, the DOE said.

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