Originally published for customers March 27, 2024.
A coalition of Republican state AGs, spearheaded by Louisiana and Texas, have sued the Biden administration in the District Court for the Western District of Louisiana regarding its LNG export pause. We examined the oil and gas leasing pause lawsuit as a possible analog to predict likely outcomes in the case, and discussed our ISD forecast for Venture Global's Plaquemines project.
What’s the issue?
Recent legal actions mark the next phase of the dispute over President Biden's “pause” of new licenses for liquefied natural gas (LNG) exports as 16 states have filed a lawsuit in a Louisiana federal court seeking a preliminary injunction to restart permit reviews. Meanwhile, rumor has it that Venture Global’s Plaquemines LNG could come online sooner than expected, and the company is also acquiring a fleet of nine LNG vessels.
Why does it matter?
Updates on lawsuits and business developments among key players are crucial for making business decisions in the domestic and global LNG markets. A successful lawsuit could expedite the authorization process for terminals requiring non-FTA approval, such as Venture Global’s CP2 project, facilitating easier contract acquisition and FID attainment. Moreover, the acquisition of additional LNG vessels would greatly enhance Venture Global’s capacity to sell and transport its cargo, particularly with the imminent launch of the Plaquemines LNG project.
What’s our view?
In 2021, a similar lawsuit was filed by 13 states contesting President Biden's pause on oil and gas leases in the same court. While the LNG export authorization process differs significantly from oil and gas leasing, the court's previous reasoning and political composition could influence the outcome in favor of the plaintiff states. As for Plaquemines LNG, Venture Global's projections suggest a faster timeline compared to historical projects.
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