U.S. FERC Announces Scoping Period for Liquid Natural Gas Export Terminal’s Proposed Carbon Capture and Sequestration Systems

On September 9, 2022, the Federal Energy Regulatory Commission (FERC) issued a Notice of Scoping Period Requesting Comments on Environmental Issues for the Proposed Carbon Capture and Sequestration System Amendment, and Notice of Public Scoping Sessions (Notice) requesting public comment on the environmental effects of a proposed carbon capture and sequestration (CCS) systems addition to the Rio Grande Liquid Natural Gas (LNG) Terminal (Terminal). This marks the first time FERC has requested public comment on the potential environmental effects, environmental mitigation measures, and reasonable alternatives related to CCS technology as part of National Environmental Policy Act review for an LNG terminal facility.

The Notice follows Rio Grande LNG, LLC’s November 17, 2021, application to voluntarily amend its November 22, 2019, authorization to site, construct, and operate the Terminal to incorporate CCS systems into the Terminal’s approved site and design. If constructed, the CCS systems would capture and sequester at least 90% of the carbon dioxide (CO2) emissions at the Terminal. The captured CO2 would be transported by a non-FERC jurisdictional pipeline to an underground geologic formation. The CCS systems would require a number of facility modifications, including adding both a postcombustion capture system for exhaust flute gas and a hot oil system; re-routing the Terminal’s acid gas removal unit vent stream; and adding necessary equipment, such as heat exchangers and pumps, to accommodate the CCS system. Construction of the proposed CCS systems would occur within the previously authorized Terminal boundary and would not result in any new land requirements. The proposed pipeline route has not been finalized, and therefore any associated land requirements are unknown at this time.

Comments are due by 5 pm Eastern time on Monday, October 3, 2022. Following the scoping period, FERC will issue either a draft environmental assessment (EA) or environmental impact statement (EIS) for public comment. At the conclusion of the comment period, FERC will issue a final EA or EIS.

There are several LNG terminals under development whose sponsors have been or are considering whether to incorporate CCS technology to lower emissions related to their facilities. The actions taken by FERC concerning the Terminal may provide guidance to these other LNG terminal developers while shining a light on FERC’s jurisdiction related to CCS projects.

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