174 FERC ¶ 61,207

UNITED STATES OF AMERICA

FEDERAL ENERGY REGULATORY COMMISSION

Before Commissioners: Richard Glick, Chairman;

Neil Chatterjee, James P. Danly,
Allison Clements, and Mark C. Christie.

New Fortress Energy LLC Docket No. CP20-466-000

ORDER ON SHOW CAUSE

(Issued March 19, 2021)

On June 18, 2020, the Commission issued an order directing New Fortress Energy
LLC (New Fortress Energy) to show cause why the liquified natural gas (LNG) handling
facility it constructed at the Port of San Juan in Puerto Rico is not subject to the
Commission’s jurisdiction under section 3 of the Natural Gas Act (NGA) (Show Cause
Order). 1 New Fortress Energy filed a response on July 20, 2020. For the reasons
discussed below, we find that the LNG handling facility is subject to the Commission’s
jurisdiction under NGA section 3 and direct New Fortress Energy to file an application
for authorization to operate the facility within 180 days of this order. 2 We also find that
allowing operation of the facility to continue during the pendency of an application is in
the public interest.

I. Background

A. New Fortress Energy’s Facility

New Fortress Energy, through its subsidiary, NFEnergía LLC, constructed and
operates an LNG handling facility on an approximately 6.1-acre plot of land at
Wharves A and B of the Port of San Juan. 3 New Fortress Energy describes Wharves A
and B as a multi-use fuel handling berth and states that it chose this specific location

1
New Fortress Energy, LLC, 171 FERC ¶ 61,230 (2020).
2
Because the New Fortress Energy facility is already constructed, we waive the
mandatory pre-filing procedures. See 18 C.F.R. § 153.12 (2020).
3
A description of New Fortress Energy’s facility is included in Appendix B of
New Fortress Energy’s July 20, 2020 Response.
Docket No. CP20-466-000 -2-

because it is in a part of the San Juan Harbor that has long been used to deliver fuels into
Puerto Rico and that will continue to receive various fuels in the future.

LNG reaches the facility through a floating storage unit (FSU) that is
semi-permanently moored at San Juan Harbor. Specifically, shuttle vessels deliver LNG
to the FSU after conducting lightering operations with ocean-going, bulk-carrier
LNG tankers which are anchored off the coast of Puerto Rico outside of Puerto Rican
waters. The FSU transfers LNG onshore through cargo transfer pumps located on the
vessel and two or three non-permanent, flexible, eight-inch-diameter cryogenic hoses that
extend from the FSU. One or two hoses are used to handle the liquid natural gas,
depending on the desired flow rate, and the third hose is used to maintain the boil-off gas
vapor on the marine vessel.

The facility distributes LNG in two ways: (1) via truck, following ship-to-truck
LNG trans-loading operations; and (2) through a direct natural gas vapor connection to
Puerto Rico Electric Power Authority’s (PREPA) San Juan Power Plant. When the
facility is operating its truck loading facilities, LNG flows from the cryogenic hoses to an
onshore liquid header and is then routed to a truck-loading rack with four bays for
loading into International Standard Organization (ISO) containers or tankers. A pressure
vessel is required in order to maintain and balance pressure during the unloading process
from the FSU to the truck-loading rack. This pressure vessel provides a buffering
function, but, according to New Fortress Energy, does not function as onsite storage. The
LNG is then distributed throughout Puerto Rico to industrial consumers via truck.

When the facility is providing natural gas vapor to the abutting San Juan Power
Plant, LNG is routed from the onshore liquid header to vaporizers for regasification. As
with the truck-loading operations, the piping system includes a pressure vessel that
provides a buffer between the FSU and the sendout pump. New Fortress Energy states
that it cannot send gas to the San Juan Power Plant or load trucks without the FSU
present, which it contends indicates that the pressure vessel does not function as onsite
storage. Four LNG withdrawal lines connect the pressure vessel to a single high-pressure
sendout pump, which is fully submerged in LNG and contained within pump cans. LNG
from the pump then flows to two regasification units. Natural gas exits each
regasification unit via 10-inch-diameter, stainless steel process piping, which combine
into a 14-inch-diameter stainless steel process pipe that connects to a metering skid.
Natural gas flows directly from the metering skid to the San Juan Power Plant via
a 75-foot, 10-inch-diameter, carbon steel pipe. New Fortress Energy’s portion of the pipe
terminates at the wall that separates the LNG facility from the power plant and connects
with power plant piping owned by the PREPA. 4

4
New Fortress Energy states that the piping, including the portion that is part of
New Fortress Energy’s facility, is identical to the piping typically used on-site at
Docket No. CP20-466-000 -3-

B. New Fortress Energy’s July 20, 2020 Response to the Show Cause
Order

On July 20, 2020, New Fortress Energy filed a response to the Show Cause Order
arguing that its facility should not be subject to the Commission’s NGA section 3
jurisdiction. New Fortress Energy contends that the facility is not a jurisdictional
LNG terminal because it: (1) does not receive natural gas or deliver regasified LNG
through a pipeline; (2) is not located at the point of import or export such that LNG is
directly transferred to or from oceangoing, bulk-carrier LNG tankers; and (3) does not
have sufficient physical elements to constitute natural gas facilities as commonly
understood by the Commission and the regulated community. 5

II. Comments, Interventions, and Answers

On July 31, 2020, a group of 11 non-profit environmental, community, and labor

6
groups (collectively, NGOs) filed a motion to intervene and protest of New Fortress
Energy’s July 20, 2020 response. On August 14, 2020, New Fortress Energy filed an
answer to the protest and opposed the NGOs’ motion to intervene, noting that the
Commission’s Show Cause Order did not seek interventions in this proceeding.
New Fortress Energy and the NGOs each filed additional answers to answers. The
Commission’s Rules of Practice and Procedure do not permit answers to protests or
answers to answers; 7 however, we find good cause to waive our rules and accept the
answers because they provide information that has assisted in our decision-making
process. Atlantic Climate Justice Alliance, PREPA, Sierra Club, and Ms. Diana Dakey
also filed comments.

gas-fired power plants, including Units 5 and 6 of the San Juan Power Plant, to move
natural gas both around the site and inside the plant itself.
5
New Fortress Energy July 20, 2020 Response at 3.
6
They are: (1) The Comité Pro Seguridad y el Ambiente del Barrio Sabana;
(2) El Puente de Williamsburg, Inc. – Enlace Latino de Acción Climática;
(3) Comité Yabucoeño Pro-Calidad de Vida, Inc.; (4) Alianza Comunitaria Ambientalista
del Sureste, Inc.; (5) Sierra Club Puerto Rico, Inc.; (6) Mayagüezanos por la Salud y el
Ambiente, Inc.; (7) Coalición de Organizaciones Anti Incineración, Inc.; (8) Amigos del
Río Guaynabo, Inc.; (9) Campamento Contra las Cenizas en Peñuelas, Inc.;
(10) Comité Diálogo Ambiental, Inc.; and (11) Unión de Trabajadores de la Industria
Eléctrica y Riego, Inc.
7
18 C.F.R. § 385.213(a)(2) (2020).
Docket No. CP20-466-000 -4-

Although the Show Cause Order did not seek comments or interventions, the
NGOs have demonstrated that good cause exists to grant their motion because no other
party can represent their interests and permitting intervention would not disrupt the
proceeding. Therefore, we grant the NGOs’ motion to intervene. The protest, answers,
and comments are addressed below.

III. Discussion

Section 3(e)(1) of the NGA states that “[t]he Commission shall have the exclusive
authority to approve or deny an application for the siting, construction, expansion, or
operation of an LNG terminal.” 8 NGA section 2(11), which was added to the act in 2005,
defines an LNG terminal as:

all natural gas facilities located onshore or in State waters that are
used to receive, unload, load, store, transport, gasify, liquefy, or
process natural gas that is imported to the United States . . . ,
exported to a foreign country . . . , or transported in interstate
commerce by waterborne vessel, but does not
include– (A) waterborne vessels used to deliver natural gas to or
from any such facility; or (B) any pipeline or storage facility subject
to the jurisdiction of the Commission under [section 7]. 9

The Commission makes jurisdictional determinations concerning projects,

including LNG projects, on a case-by-case basis. 10 Further, the vast majority of
proposals the Commission has had the opportunity to consider involved large, coastal
facilities either receiving natural gas vapor from a transportation pipeline and delivering
LNG into a large, ocean going bulk carrier, or receiving LNG from a large bulk carrier
and delivering vapor into a pipeline for subsequent transportation. Based on this
experience, we have considered three criteria when determining whether a facility is an
LNG import or export terminal subject to the Commission’s jurisdiction: (1) whether an

8
15 U.S.C. § 717b(e)(1). The 1977 DOE Organization Act (42 U.S.C. § 7151(b))
placed all section 3 jurisdiction under DOE. The Secretary of Energy subsequently
delegated authority to the Commission to “[a]pprove or disapprove the construction and
operation of particular facilities, the site at which such facilities shall be located, and with
respect to natural gas that involves the construction of new domestic facilities, the place
of entry for imports or exit for exports.” DOE Delegation Order No. 00-004.00A,
section 1.21A (May 16, 2006).
9
15 U.S.C. § 717a(11).
10
Gulf Oil Limited Partnership, 148 FERC ¶ 61,029, at P 8 (2014) (citing
Marathon Oil Company, 53 F.P.C. 2164 (1975)).
Docket No. CP20-466-000 -5-

LNG terminal would include facilities dedicated to the import or export of LNG; 11
(2) whether the facility would be located at or near the point of import or export; 12 and
(3) whether the facility would receive or send-out gas via a pipeline. 13 For
LNG terminals operating in interstate commerce the Commission considered a
fourth criterion – whether after leaving the facility the LNG is reintroduced into
a pipeline such that the LNG terminal facilitates the interstate transportation of natural
gas by pipelines. 14

As discussed below, we find that the New Fortress Energy facility is an

LNG terminal as defined by the NGA.

A. Jurisdiction of New Fortress Energy’s Facility

1. New Fortress Energy Constructed a Dedicated LNG Facility

New Fortress Energy has constructed and operates a dedicated LNG facility at the
Port of San Juan. Although New Fortress Energy notes that Wharves A and B, the
location of the LNG facility at the port, make up a multi-use fuel handling berth, the
Commission would not be exerting jurisdiction over the wharves themselves. Rather, the
Commission’s jurisdiction would extend only to the facility constructed by New Fortress
Energy for the purpose of importing LNG, and nothing in the record indicates that the
New Fortress Energy facility would be used for any other purpose. Nor does

11
See The Gas Company, LLC, 142 FERC ¶ 61,036 (2013) (The Gas Company)
(finding no jurisdiction where the same facilities would be used to import ISO containers
full of LNG and other ISO containers filled with general goods).
12
See Pivotal LNG, Inc., 151 FERC ¶ 61,006 (2015) (Pivotal II) (finding that
inland liquefaction facilities that transport ISO containers by truck to the point of export
are not LNG terminals).
13
See Shell U.S. Gas & Power, LLC, 148 FERC ¶ 61,163 (2014) (Shell) (finding
LNG import facilities that receive LNG by ship and subsequently send the LNG out by
vessel, rail, or truck are not LNG terminals).
14
Id. P 45 (“an LNG terminal receiving LNG transported in interstate commerce
by waterborne vessel would be subject to section 7 jurisdiction if any of the gas received
at the terminal would be revaporized and injected into a jurisdictional pipeline. Such
facilities would be links in an interstate chain, liquefying and regasifying in order to
enable gas to be ferried across a stretch of water interrupting what would otherwise be
a continual flow of gas by pipeline from one state to another.”).
Docket No. CP20-466-000 -6-

New Fortress Energy allege that its LNG facility is integrated with the facilities used to
import fuels other than LNG.

This is in contrast with the facilities that the Commission found not to be
jurisdictional in The Gas Company. 15 In that case, the applicant proposed to use general
port facilities to import LNG-filled ISO containers into Hawaii. However, because the
pier facilities, which would receive, load, and unload the vessels carrying ISO containers
of LNG, were the same facilities currently receiving, loading, and unloading containers
filled with other products, the Commission determined that the pier facilities did not
constitute “natural gas facilities” and therefore, the Commission lacked jurisdiction over
them. 16 As stated above, there is no indication that the New Fortress Energy facility will
be used to import anything other than LNG.

We also disagree with New Fortress Energy’s claim that an LNG terminal must
include certain specific natural gas facilities, such as a storage tank or LNG processing. 17
Although nearly every authorized LNG terminal has included onshore storage and
processing, nothing in section 2(11) of the NGA requires LNG terminals to include
specific equipment. Rather, the definition states that an LNG terminal consists of “all
natural gas facilities located onshore or in State waters that are used to receive, unload,
load, store, transport, gasify, liquefy, or process natural gas that is imported to the
United States . . . [or] exported to a foreign country . . . .” 18 In fact, the Commission has
exerted jurisdiction over facilities with various configurations, including those that lack
onshore LNG storage. 19

Similarly, we are not persuaded by New Fortress Energy’s assertion that its
facility does not include “natural gas facilities” due to the acreage it occupies or the
federal permits required to construct it. 20 The size and federal permits required for

15
The Gas Company, 142 FERC ¶ 61,036.
16
Id. P 14.
17
The NGOs allege that the New Fortress Energy facility includes, or will include
in the future, onshore LNG storage. NGOs July 31, 2020 Protest at 24-25. Because the
existence of onshore LNG storage is not determinative of our jurisdiction, we need not
speculate regarding whether pressure vessels act as storage or whether New Fortress
Energy intends to construct LNG storage in the future.
18
15 U.S.C. § 717a(11) (emphasis added).
19
See, e.g., Aguirre Offshore GasPort, LLC, 152 FERC ¶ 61,071 (2015) (Aguirre).
20
New Fortress Energy July 20, 2020 Response at 39-40.
Docket No. CP20-466-000 -7-

a given facility are primarily a function of the volume of LNG imported (or exported)
and the equipment used to effectuate such imports (or exports). The NGA does not
distinguish between large or small LNG terminals for any purpose, including jurisdiction.

Because New Fortress Energy constructed a facility exclusively used to unload

and gasify LNG imported to the United States, we find that New Fortress Energy has
constructed a dedicated LNG facility at the Port of San Juan.

2. New Fortress Energy’s Facility Is Located At the Point of

Import

We also find that New Fortress Energy’s facility is located at the point of import
and capable of transferring LNG from an ocean-going LNG tanker. New Fortress
Energy’s operation of transferring LNG from an anchored LNG tanker outside of
Puerto Rican waters to smaller supply ships, which then supply the FSU, does not render
New Fortress Energy’s facility non-jurisdictional. In the context of determining whether
facilities constitute an LNG terminal, the Commission has only once found that the
facilities were not an LNG terminal because of their location in relation to the point of
import or export. 21 In Pivotal II, the Commission determined that if certain inland
liquefaction facilities produce LNG that would subsequently be exported, those inland
facilities would not be jurisdictional LNG terminals. 22 However, that case is
distinguishable from New Fortress Energy’s facility because the facilities at issue in
Pivotal II were located over one hundred miles from the point of export and LNG was not
capable of being directly transferred from the facilities onto an ocean-going LNG tanker.
Instead, the LNG would be transported to the ultimate point of export by truck or
tanker. 23 Here, New Fortress Energy’s waterside LNG facility connects directly to an
LNG vessel via a hose.

New Fortress Energy also asserts that LNG tankers are commonly understood to
be of a particular size and the vessels used in its operation are much smaller. 24 Thus,
New Fortress Energy concludes that its facility is not capable of directly transferring

21
We note that in Emera CNG, LLC and Andalusian Energy, LLC, the
Commission found certain compressed natural gas facilities to be non-jurisdictional.
Emera CNG, LLC, 148 FERC ¶ 61,219 (2014); Andalusian Energy, LLC, 174 FERC
¶ 61,107 (2021). However, in those cases, the Commission was considering its
jurisdiction over export facilities, not LNG terminals.
22
Pivotal II, 151 FERC ¶ 61,006.
23
Id. P 12.
24
New Fortress Energy July 20, 2020 Answer at 35-38.
Docket No. CP20-466-000 -8-

LNG from an ocean-going, bulk-carrier LNG tanker. 25 While the Commission has noted
that it has thus far only exercised its jurisdiction over facilities located at the point of
import or export such that LNG is directly transferred to or from an ocean-going,
bulk-carrier LNG tanker, those statements were meant to distinguish dedicated
LNG tankers from general use cargo ships that may transport LNG-filled ISO
containers. 26 New Fortress Energy’s assertion that an LNG carrier must be a certain size
is without merit and contrary to the NGA, which, as stated above, contains no minimum
size limits under the definition of LNG terminal 27 or in section 3 or 7.

Nor does the NGA exempt facilities that rely on a chain of transfers from
ocean-going vessels to smaller ocean-going vessels to avoid the Commission’s
jurisdiction. 28 Adopting such an approach would undermine the NGA’s purpose of
providing Commission oversight of the siting and construction of LNG terminals. For
example, a developer could construct an LNG export terminal that includes liquefaction,
storage, and other facilities typically found at LNG terminals, but avoid the
Commission’s jurisdiction by building a dock capable of having two ships moored to it
and routing LNG through one of the vessels before transferring it to the vessel that would
ultimately export it.

We also note that the fact that the Commission would not have jurisdiction over
the FSU would not itself render the other LNG facilities non-jurisdictional. In Aguirre, 29
the applicant proposed to construct an offshore berthing platform where LNG would be
transferred from an LNG tanker to a floating storage and regasification unit (FSRU). 30

25
Id. at 38.
26
The Commission has not been presented with a project that would include a
dedicated LNG facility at the point of import/export that only imported or exported LNG
through ISO containers; thus, we have not considered whether such a facility would be
jurisdictional.
27
Section 2(11) of the NGA only uses the term waterborne vessel, and contrary to
New Fortress Energy’s argument, a “pocket-sized” LNG vessel is still an ocean-going,
bulk-carrier LNG tanker.
28
As the NGOs note in their protest, the vessels used as FSUs are ocean-going
LNG tankers. NGOs July 31, 2020 Protest at 23-24.
29
Aguirre, 152 FERC ¶ 61,071.
30
New Fortress Energy argues that the Commission should not rely on Aguirre or
EcoEléctrica to assert jurisdiction here because the jurisdictional question was not
litigated in either of those proceedings. Under NGA section 3, the Commission does not
have discretion to determine that an otherwise non-jurisdictional LNG facility is
Docket No. CP20-466-000 -9-

Aguirre’s FSRU would then transfer natural gas onshore to a power plant. Although the
Commission did not have jurisdiction over the LNG tanker or Aguirre’s FSRU, finding
the latter to also be a “waterborne vessel[] used to deliver natural gas to or from any such
[LNG Terminal] facility” under section 2(11), 31 the Commission asserted jurisdiction
over the berthing platform and pipeline as an LNG import terminal. 32

We conclude that New Fortress Energy’s facility is located at the point of import
and is unlike the inland facilities the Commission has previously found to be
non-jurisdictional. Further, the transfer of LNG from a larger ocean-going vessel to a
smaller one or the Commission’s jurisdiction over some but not all facilities does not
render the New Fortress Energy facility non-jurisdictional.

3. New Fortress Energy’s Facility Is Connected to a Pipeline

In Shell U.S. Gas & Power, LLC, the Commission found that a proposed LNG
import facility that would be constructed on Lake Michigan in Michigan would not be a
jurisdictional LNG terminal because the facility would not be connected to a
33
pipeline. However, unlike the import facility at issue in Shell, which was not connected
to any type of piping, New Fortress Energy’s facility is connected to an adjacent power
plant via a 10-inch-diameter pipeline.

New Fortress Energy argues that the Commission should consider various physical
characteristics of the piping, such as the design specifications, operating pressure, length,
and diameter of pipe, in determining whether an LNG facility is connected to a
pipeline. 34 We disagree. The Commission has never considered such physical

jurisdictional. Therefore, despite New Fortress Energy’s assertion that the “cases give no
meaningful guidance,” the fact that those facilities were considered to be jurisdictional
LNG terminals is informative to this inquiry. See also The Gas Company, 142 FERC
¶ 61,036 (dismissing an application because the Commission would not have jurisdiction
over the facilities).
31
15 U.S.C. § 717a(11)(A).
32
Aguirre, 152 FERC ¶ 61,071.
33
Shell, 148 FERC ¶ 61,163 at P 43 (citations omitted).
34
New Fortress Energy July 20, 2020 Response at 20; see also New Fortress
Energy August 14, 2020 Answer at 4-7 (noting that the Commission considers physical
characteristics of the pipeline in determining if a facility is gathering). The NGO’s
disagree that such characteristics meaningfully distinguish the New Fortress Energy
facility from other jurisdictional LNG terminals. NGOs July 31, 2020 Protest at 31-39.
Docket No. CP20-466-000 - 10 -

characteristics when determining whether a facility is an LNG import or export terminal.

Examining those factors here makes it clear that none of them are indicative of the
function of the LNG facility itself. Rather, the physical characteristics of any piping
are a function of the volume of LNG to be imported or exported and the relative distance
between the LNG terminal and the ultimate end-user. Section 3 contains no
minimum size limit in the definition of LNG terminal, nor does section 7 as to pipelines;
accordingly, jurisdiction under section 3 or 7 is not dependent on the size of a facility.
Further, to the extent that New Fortress Energy’s balancing test seeks to determine
whether a connected pipeline is engaged in transportation (as opposed to some other
function), it is arguable that such a formulation could lead to the result that the
Commission’s jurisdiction would not attach to a large-scale LNG export terminal that
receives natural gas directly from nearby production and gathering facilities or an import
facility directly connected to a large local distribution company. Thus, the physical
characteristics of the piping cited by New Fortress Energy are not relevant to our
35
jurisdictional determination.

Next, New Fortress Energy states that in Shell, the Commission declined to assert
jurisdiction over a proposed LNG facility in Geismar, Louisiana, 36 that would have
included piping similar to the piping at the New Fortress Energy facility. Specifically,
New Fortress Energy notes that the proposed Geismar facility would include short
segments of pipe that would deliver boil-off gas to large industrial customers adjacent to
the liquefaction site 37 and that any LNG delivered from the Geismar facility to end-users
would necessarily have been regasified and transferred in piping similar to the pipe found
at New Fortress Energy’s facility. 38 Thus, New Fortress Energy contends that
Commission has previously found similar piping to not be a pipeline for the purpose of
its jurisdiction.

35
This is in contrast with the Commission’s primary function test for gathering
facilities, which does examine these physical characteristics. However, for those
facilities, the diameter and pressure of the lines are relevant to determining whether the
facility operates as a gathering facility because historically, gathering facilities are of
a particular size and configuration. That is not the case as here where the physical
characteristics of the piping is simply related to the location and size of this
LNG terminal, not its operation as an LNG terminal.
36
The Geismar facility is distinct from the Lake Michigan facility discussed
above.
37
Id. at 26.
38
New Fortress Energy July 20, 2020 Response at 25-28.
Docket No. CP20-466-000 - 11 -

The Commission’s analysis of the Geismar facility bears no relevance to whether

New Fortress Energy’s facility is an LNG import terminal subject to the Commission’s
jurisdiction because the Geismar facility would operate in interstate commerce, not
foreign commerce. As stated above, for facilities operating in interstate commerce, like
the Geismar facility, the Commission considers whether after leaving the facility, the
LNG is reintroduced into a pipeline such that the LNG terminal facilitates the interstate
transportation of natural gas by pipelines. New Fortress Energy’s argument regarding the
segments of piping that deliver regasified LNG to end-users is related only to this
consideration, which is irrelevant to whether New Fortress Energy’s facility is an
LNG terminal operating in foreign commerce.

New Fortress Energy also argues that exerting jurisdiction here would greatly
expand the Commission’s regulatory reach over facilities that have never been considered
jurisdictional LNG terminals. 39 New Fortress Energy speculates that if the Commission
were to find that its piping were a pipeline, the Commission could find LNG facilities
that transfer LNG by truck directly to end-users, such as power plants or other industrial
customers, are jurisdictional LNG terminals because those end-users move regasified
LNG within their facilities using piping similar to that found at New Fortress Energy’s
facility. 40

New Fortress Energy’s concerns are misplaced. The hypothetical posited by

New Fortress Energy, involving liquefaction of natural gas for purposes of the interstate
delivery of LNG by truck to end users, is distinguishable from this case because
New Fortress Energy’s facility operates in foreign commerce. As discussed above, when
examining LNG facilities operating in interstate commerce, the Commission exerts
jurisdiction only where the conversion of natural gas into LNG enables interstate
transportation of such gas by pipeline. 41 If the LNG does not reenter a pipeline system,

39
New Fortress Energy July 20, 2020 Response at 9, 33-35.
40
Id. at 9-10, 33-35 (noting that those facilities authorized under section 7 of the
NGA would also be granted eminent domain authority).
41
See Shell, 148 FERC ¶ 61,163 at P 45 (“an LNG terminal receiving LNG
transported in interstate commerce by waterborne vessel would be subject to section 7
jurisdiction if any of the gas received at the terminal would be revaporized and injected
into a jurisdictional pipeline. Such facilities would be links in an interstate chain,
liquefying and regasifying in order to enable gas to be ferried across a stretch of water
interrupting what would otherwise be a continual flow of gas by pipeline from one state
to another.”).
Docket No. CP20-466-000 - 12 -

this does not occur. In fact, this is the precise set of facts that the Commission considered
in Pivotal I and found the facilities to be non-jurisdictional. 42

Because the New Fortress Energy facility includes facilities dedicated to the
importation of LNG in foreign commerce, is located at or near the point of import, and
includes a pipeline that sends out gas, it is an LNG terminal subject to the Commission’s
jurisdiction.

B. New Fortress Energy’s Intent and the Public Benefits of the Project
Are Not Relevant

New Fortress Energy argues that the LNG facility has many public benefits to
Puerto Rico, most notably its ability to provide cleaner, affordable, and reliable power to
the island. 43 The NGOs assert that several documents, including PREPA’s request for
proposal for the LNG facility, acknowledge that the New Fortress Energy facility is an
LNG terminal subject to the Commission’s jurisdiction.44 The NGOs also claim that,
contrary to New Fortress Energy’s assertion, 45 the facility does not have a positive impact
on the electric grid or Puerto Rican consumers. 46

The NGA establishes the Commission’s jurisdiction over facilities. As discussed

above, a facility’s physical configuration and function determines whether it is an
LNG terminal under the NGA. The understanding of the applicant or the potential public
impacts of a project are not relevant to our jurisdictional determination.

C. No Regulatory Gap Exists

The NGOs argue that New Fortress Energy constructed its facility and claimed its
non-jurisdictional status in order to avoid review under the National Environmental
Policy Act (NEPA). 47 They contend that if the Commission fails to assert jurisdiction,

42
Pivotal I, 148 FERC ¶ 61,164.
43
New Fortress Energy July 20, 2020 Response at 49-54.
44
NGOs July 31, 2020 Protest at 21-22.
45
New Fortress Energy July 20, 2020 Response at 49-54.
46
NGOs July 31, 2020 Protest at 25-29.
47
Id. at 29.
Docket No. CP20-466-000 - 13 -

the facility will not have undergone a comprehensive environmental review, thus
resulting in a regulatory gap. 48

As the court explained in ExxonMobil Gas Marketing Company v. FERC, the

“need for regulation cannot alone create authority to regulate,” and “jurisdiction may not
be presumed based solely on the fact that there is not an express withholding of
jurisdiction.” 49 However, we note that the fact that this Commission had not reviewed
New Fortress Energy’s facility prior to its construction does not mean that other federal
and local regulatory agencies lacked the authority to impose environmental and safety
conditions on the construction and operation of the facility. According to New Fortress
Energy, the U.S. Coast Guard has overseen the design, construction, and implementation
of the marine cargo transfer systems and will continue to do so during the operation of
the facility. 50 The U.S. Coast Guard has also issued a final rule adjusting the existing
moving safety zone in San Juan Harbor to accommodate the safe navigation and mooring
of shuttle vessels within the San Juan Harbor. 51 In addition, the U.S. Army Corps of
Engineers regulates the facility under a nationwide permit, which required consultations
with the U.S. Fish and Wildlife Service, National Marine Fisheries Service, and state
historic preservation office. 52 Further, multiple territorial permits and requirements apply
to the design, construction, and operation of the facility, which included an
environmental analysis under the territorial equivalent of NEPA. New Fortress Energy
received permits from the Puerto Rico Department of Transportation and Public Works,
which is responsible for inspection and enforcement of certain pipeline safety regulations
in Puerto Rico, determines what regulations apply to the power-plant piping connecting
the facility to the San Juan Power Plant, and, if applicable, verifies a project’s compliance
with the Department of Transportation’s Pipeline and Hazardous Materials Safety
Administration’s regulations. 53

48
Id. at 29, 45-54 (noting that a NEPA review would have included an analysis of
the safety of the facility, which, according to the NGOs, was not conducted).
49
297 F.3d 1071, 1088 (D.C. Cir. 2002).
50
New Fortress Energy July 20, 2020 Answer at 48; New Fortress Energy
August 14, 2020 Answer at 27-28.
51
New Fortress Energy July 20, 2020 Answer at 48-49; New Fortress Energy
August 14, 2020 Answer at 27-28, 30.
52
New Fortress Energy July 20, 2020 Answer at 49; New Fortress Energy
August 14, 2020 Answer at 24.
53
New Fortress Energy August 14, 2020 Answer at 24-26.
Docket No. CP20-466-000 - 14 -

With respect to the NGOs allegation that New Fortress Energy violated NEPA,
NEPA applies to federal agencies, not applicants, and requires the federal agency to
assess the environmental effects of their proposed actions prior to making decisions. 54
Here, because we find that the LNG facility constructed by New Fortress Energy is
a jurisdictional LNG terminal, the Commission will conduct a NEPA analysis based on
the application that New Fortress Energy submits in response to this order. 55

New Fortress Energy contends that the Commission’s jurisdiction is unnecessary

because the facility is already regulated on both the federal and territorial level. 56 While
it is true that other federal and local agencies exercise some jurisdiction over the facility,
this is true of all LNG terminals and is not a basis, in and of itself, for not finding
jurisdiction here.

D. NGO’s Remaining Arguments

The NGOs allege that New Fortress Energy may commit violations of the
Jones Act by importing domestically produced natural gas on foreign vessels and may
have committed violations of other federal and territorial statutes and regulations. 57 The
Commission has no authority to enforce the Jones Act or the other statutes cited by the
NGOs, and therefore, these arguments are hereby dismissed.

The NGOs also request that the Commission open an enforcement action against
New Fortress Energy for constructing the LNG facility without prior approval. 58 Given
the rapid growth in interest in LNG and the wide variability among facility
configurations, we acknowledge that the Commission’s precedent regarding its
jurisdiction over LNG facilities is not easily extrapolated from one facility to another.
We believe that this order should improve that situation. At the same time, we emphasize
that uncertainty regarding the scope of our authority does not give an entity carte blanche

54
Macht v. Skinner, 916 F.2d 13, 18 (D.C. Cir. 1990) (“NEPA requires federal
agencies—not states or private parties—to consider the environmental impacts of their
proposed actions.”); Found. on Econ. Trends v. Heckler, 756 F.2d 143, 155
(D.C. Cir. 1985) (“NEPA applies only to federal agencies.”).
55
To the extent that the NGOs argue that this action requires review under NEPA,
our action is categorically excluded. See 18 C.F.R. § 380.4(a)(1) (2020).
56
New Fortress Energy July 20, 2020 Response at 48-49.
57
NGOs July 31, 2020 Protest at 22-23, 54-57; see also NGOs August 24, 2020
Answer at 13-16.
58
NGOs July 31, 2020 Protest at 58-59.
Docket No. CP20-466-000 - 15 -

to purse an action which ultimately might be found to violate the NGA – while
New Fortress had informal discussions of with Commission staff, it chose not to seek a
declaratory order from the Commission on its jurisdiction before constructing its facility.
However, on the facts here, although we find that New Fortress Energy has constructed
an LNG terminal subject to the Commission’s jurisdiction without obtaining the
necessary prior authorization, presuming they comply with the requirements of this order,
we do not believe an enforcement action is warranted.

E. New Fortress May Continue Operating While the Commission

Processes Its Application

The NGOs argue that the Commission should require New Fortress Energy to halt
operation until it receives a section 3 authorization. 59 They contend that by not seeking
authorization prior to construction, New Fortress Energy evaded environmental review,
upending the requirements of NEPA. 60 The NGOs claim that allowing the continued
operation of the facility would allow continued violations of NEPA, which are
particularly acute because of the alleged significant environmental and safety concerns
associated with the site and type of facilities. 61

We disagree. The New Fortress Energy facility supplies cleaner burning natural
gas to the San Juan Power Plant. As stated above, the U.S. Coast Guard oversaw the
design, construction, and implementation of the marine cargo transfer systems, which
included waterway suitability assessments and onshore operational assessments. In
addition to the U.S. Coast Guard’s review, the U.S. Army Corps of Engineers regulates
the facility under a nationwide permit, which required consultations with the U.S. Fish
and Wildlife Service and National Marine Fisheries Service. Further, multiple territorial
permits and requirements apply to the design, construction, and operation of the facility
and included an environmental review by Puerto Rican agencies. Under these
circumstances, we find that allowing operation of the facilities to continue during the
pendency of an application is in the public interest. 62

59
Id. at 58.
60
Id. at 46.
61
Id. at 45-54.
62
Egan Hub Partners, L.P., 73 FERC ¶ 61,334, at 61,932 (1995) (“[I]n order to
avoid hardship to Egan’s customers, we will not require Egan to terminate storage service
pending final action in this proceeding and Commission disposition of the certificate
application required herein.”); see also Kansok Partnership, 73 FERC ¶ 61,160, at 61,488
(1995) )(“Accordingly, the Commission is requiring Kansas Pipeline, et al. to comply
with the applicable requirements of the NGA. Specifically, Kansas Pipeline, et al. must
Docket No. CP20-466-000 - 16 -

IV. Conclusion

For the reasons discussed above, we find that the siting, construction, and
operation of the LNG handling facility constructed by New Fortress at the Port of
San Juan in Puerto Rico is subject to the Commission’s jurisdiction under section 3 of
the NGA. Therefore, should New Fortress desire to continue operation of that facility, it
must file with the Commission an application for authorization under section 3 of the
NGA within 180 days of the date of this order. However, at this time, we will not require
the facility to cease operating as a result of this order. Finally, we again note that
abundant supplies of natural gas and technological advancements have changed the
nature of LNG facilities throughout the United States and enabled the development of
novel configurations for importing, exporting, and transporting natural gas as LNG.
Although not required by the NGA, we urge project developers to seek the Commission’s
formal guidance through a petition for declaratory order regarding novel questions of
jurisdiction prior to constructing their facilities. Such a process will ensure that the
public, federal and state agencies, and other stakeholders understand the Commission’s
role, if any, in authorizing such facilities.

The Commission orders:

(A) The LNG handling facility constructed by New Fortress Energy is subject
to the Commission’s jurisdiction.

(B) New Fortress Energy shall submit an application for authorization to

operate the facility within 180 days.

(C) The NGOs’ motion to intervene is granted.

By the Commission. Chairman Glick and Commissioner Clements are concurring with
a joint separate statement attached.
Commissioner Danly is dissenting with a separate statement
attached.
Commissioner Christie is concurring with a separate statement
attached.

(SEAL)

file an application for certificate authorization, pursuant to NGA section 7 and Part 157
of the Commission's regulations, to operate its system.”).
Docket No. CP20-466-000 - 17 -

Kimberly D. Bose,
Secretary.
 UNITED STATES OF AMERICA
FEDERAL ENERGY REGULATORY COMMISSION

New Fortress Energy LLC Docket No. CP20-466-000

(Issued March 19, 2021)

GLICK, Chairman, and CLEMENTS, Commissioner, concurring:

We concur in today’s order finding New Fortress Energy LLC’s (New Fortress
Energy) liquefied natural gas (LNG) facility subject to the Commission’s jurisdiction
under section 3 of the Natural Gas Act (NGA). We write separately to explain our view
that it is time to reconsider our precedent in Shell U.S. Gas & Power, LLC (Shell), which
held that a facility must be connected to a pipeline to be a jurisdictional LNG terminal. 1

There is no such limitation in the plain language of the NGA. Section 3(e)(1) of
the NGA states that “[t]he Commission shall have the exclusive authority to approve or
deny an application for the siting, construction, expansion, or operation of an LNG
terminal.” 2 NGA section 2(11), which was added to the NGA in 2005, defines an LNG
terminal as: “all natural gas facilities located onshore or in State waters that are used to
receive, unload, load, store, transport, gasify, liquefy, or process natural gas that is
imported to the United States . . . , exported to a foreign country . . . , or transported in
interstate commerce by waterborne vessel, but does not include– (A) waterborne vessels
used to deliver natural gas to or from any such facility; or (B) any pipeline or storage
facility subject to the jurisdiction of the Commission under [section 7].” 3

Nowhere does the statute say that a facility must be connected to a pipeline to
qualify as an LNG terminal and, thus, come within the Commission’s jurisdiction under
section 3. 4 We should revisit Shell to ensure that we are carrying out our statutory
responsibilities under the letter of the law.

1
Shell U.S. Gas & Power, LLC, 148 FERC ¶ 61,163, P 43 (2014).
2
15 U.S.C. § 717b(e)(1) (2018).
3
15 U.S.C. § 717a(11).
4
See Lomax v. Ortiz‐Marquez, 140 S. Ct. 1721, 1725 (2020) (“[T]his Court may
not narrow a provision’s reach by inserting words Congress chose to omit.”): Virginia
Uranium, Inc. v. Warren, 139 S. Ct. 1894, 1900 (2019) (plurality opinion) (The Court’s
“duty [is] to respect not only what Congress wrote but, as importantly, what it didn’t
Docket No. CP20-466-000 -2-

For these reasons, we respectfully concur.

________________________
Richard Glick
Chairman

________________________
Allison Clements
Commissioner

write.”).
 UNITED STATES OF AMERICA
FEDERAL ENERGY REGULATORY COMMISSION

New Fortress Energy LLC Docket No. CP20-466-000

(Issued March 19, 2021)

DANLY, Commissioner, dissenting:

I dissent from today’s order because it finds that the LNG handling facility owned
and operated by New Fortress Energy LLC (New Fortress Energy) is subject to the
Commission’s jurisdiction under Natural Gas Act (NGA) section 3. 1 Accordingly, the
majority directs New Fortress Energy to file an application, pursuant to NGA section 3,
for authorization to operate the facility. I dissent because, in my view, the Commission
should have fully applied its precedent and declined to exercise jurisdiction in this case.
Instead, I would have found that LNG facilities are only “LNG terminals” if they are
connected to a natural gas pipeline that transports imported or exported natural gas to or
from an interstate or intrastate gas transmission system. Because New Fortress Energy
is not connected to a “pipeline,” it fails this test and should have been found non-
jurisdictional.

I acknowledge that the language of NGA section 3 is poorly drafted.

Section 3(e)(1) states that “[t]he Commission shall have the exclusive authority to
approve or deny an application for the siting, construction, expansion, or operation of an
LNG terminal.” 2 The Energy Policy Act of 2005 (EPAct 2005) amended the NGA to add
section 2(11) to define “LNG terminal” to

[i]nclude[] all natural gas facilities located onshore or in State waters that
are used to receive, unload, load, store, transport, gasify, liquefy, or process
natural gas that is imported to the United States from a foreign country,
exported to a foreign country from the United States, or transported in
interstate commerce by waterborne vessel, but does not include—

1
15 U.S.C. § 717b.
2
Id. § 717b(e)(1). See also U.S. Department of Energy Delegation Order No. 00-
004.00A, section 1.21A (May 16, 2006) (delegating authority to the Commission to
“[a]pprove or disapprove the construction and operation of particular facilities, the site at
which such facilities shall be located, and with respect to natural gas that involves the
construction of new domestic facilities, the place of entry for imports or exit for
exports”).
Docket No. CP20-466-000 -2-

(A) waterborne vessels used to deliver natural gas to or from any such
facility; or

(B) any pipeline or storage facility subject to the jurisdiction of the

Commission under section 717f of this title. 3

This text is ambiguous and broad. Although LNG facilities are typically marine
terminals that take receipt of LNG by ship for storage and processing, by its plain terms
the statute could be read to encompass any facility that takes receipt of LNG from a
foreign country or handles natural gas that is destined for export. Under a strict reading,
the statute could be interpreted to subject to the Commission’s jurisdiction a rail yard in
downtown Topeka that takes shipments of LNG in ISO containers shipped by rail from
Canada and holds them for a period of time before sending them elsewhere by rail. This
is because our hypothetical rail yard meets every requirement of the statute’s definition—
it would be 1) a “facility” that; 2) is “onshore”; 3) “stores” the LNG that has been 4)
imported from “a foreign country” and is itself 5) neither a waterborne vessel nor a
section 7 pipeline. I doubt the statutory text was ever intended to be so broadly
interpreted and doubt even more that any majority of commissioners charged with
implementing the statute from the time of its enactment would have found that
jurisdiction should have been exercised over our rail yard in Topeka. 4

Given that the definition of “LNG terminal” is so broad as to encompass virtually

every “facility” that encounters LNG (aside from section 7 pipelines and marine vessels,
of course), the Commission imposed rational limits on what would be deemed an LNG

3
Id. § 717a(11).
4
Illustration of the expansiveness of the statute’s definition does not require
strained hypotheticals like that above. A plain reading of the statute would also subject to
our jurisdiction all manner of natural gas infrastructure that would otherwise be exempt
from the NGA so long as it transported natural gas originating from another country or
that was ultimately bound for export. This expansive reading could include nearly
everything including gathering facilities, local distribution systems and wholly intrastate
pipelines. See Shell U.S. Gas & Power, LLC, 148 FERC ¶ 61,163, at P 43 n.78 (2014)
(Shell) (“Indeed, a literal reading of section 2(11)’s definition of ‘LNG Terminal’ would
cause otherwise NGA-exempt gathering, intrastate pipeline, processing, and local
distribution facilities to be jurisdictional under section 3 as LNG terminal facilities if they
transport gas that was imported or gas that will be exported.”); cf. id. P 43 (“we find that
while section 2(11) sets forth a very broad definition of an ‘LNG Terminal’ . . . it does
not seek to redefine the term ‘natural gas facilities’ as commonly understood for purposes
of Commission jurisdiction”).
Docket No. CP20-466-000 -3-

terminal for the exercise of its jurisdiction in Shell. 5 In Shell, the Commission recited the
history of its jurisdiction over LNG facilities before the EPAct 2005 amendments,
including that it had declined to exercise jurisdiction over LNG facilities that did “not
have pipelines connecting the facility with either the interstate or an intrastate grid.” 6 It
further found that “the Commission has only asserted NGA jurisdiction under either
section 3 or 7 over natural gas pipeline and storage facilities, including LNG facilities,
that receive and/or send out gas by pipeline.” 7 It also explained that although the added
section 2(11) “sets forth a very broad definition of ‘LNG Terminal’ . . . it does not seek to
redefine the term ‘natural gas facilities’ as commonly understood for purposes of
Commission jurisdiction.” 8 In support, it cited to the Commission’s issuances, to the
implications of the statute’s broad language, and even to two Congressional Research
Service reports that were “consistent” with the Commission’s conclusion that a pipeline
connecting the LNG facility to the natural gas grid had been required in order to exercise
jurisdiction. 9 I agree with this precedent insofar as it establishes some limitation on the
Commission’s jurisdiction.

The issue in this case boils down to a single question: whether New Fortress
Energy transports natural gas by “pipeline.” In my opinion, it does not. New Fortress
Energy’s facility includes short segments of internal plant piping that moves LNG and
regasified LNG within the facility. These flows terminate at the facility’s fence line
where the gas directly enters the adjacent San Juan Power Plant to be burned. 10 This is a
pipe, not a “pipeline.” 11

5
See Shell, 148 FERC ¶ 61,163 at PP 37-50.
6
Id. P 40.
7
Id. P 43.
8
Id.
9
Id. P 43 n.81.
10
In contrast, in Aguirre Offshore GasPort, LLC, the proposed LNG terminal
included a subsea pipeline that would transport regasified LNG approximately 4.0 miles
from the offshore berthing platform to the interconnection with the onshore power plant.
152 FERC ¶ 61,071, at P 6 (2015), vacated, 166 FERC ¶ 61,055 (2019).
11
Compare Cambridge Dictionary, https://dictionary.cambridge.org/us/
dictionary/english/pipeline (defining “pipeline” as “a very long large tube, often
underground, through which liquid or gas can flow for long distances”), and Oxford
Learner’s Dictionaries, https://www.oxfordlearnersdictionaries.com/us/definition/
english/pipeline?q=pipeline (defining “pipeline” as “a series of pipes that are usually
Docket No. CP20-466-000 -4-

More importantly, the imported LNG is never transported on the interstate or

intrastate system because, prior to its delivery for ultimate end-use, the regasified LNG
does not exit the import facility via pipeline. The immediate, co-located use of the gas
means that none of the analytical concerns raised in Shell are implicated here. Therefore,
finding that the New Fortress Energy LNG facility is non-jurisdictional would be
consistent with the NGA and the Commission’s findings in Shell.

Although today’s decision purports to rely on Shell, it finds New Fortress

Energy’s LNG facility to be jurisdictional based on the majority’s interpretation of that
case to mean that an LNG facility is a jurisdictional LNG terminal if it is connected to
“any type of piping.” 12 Because New Fortress Energy’s facility “is connected to an
adjacent power plant via a 10-inch-diameter pipeline,” the majority finds the facility to be
jurisdictional. 13

I disagree with the majority’s interpretation. Shell did not establish a bright line
that merely required connection to “any type of piping.” Nor did Shell or any other
relevant Commission precedent employ that formulation. In fact, Shell cautioned against
such literal reading of NGA section 2(11), stating such an interpretation “would cause
otherwise NGA-exempt gathering, intrastate pipeline, processing, and local distribution
facilities to be jurisdictional under section 3 as LNG terminal facilities if they transport
gas that was imported or gas that will be exported.” 14 Shell explained that it was the
connection to (and the effect on) the interstate or intrastate natural gas transportation
system that undergirded its decision. The majority does not explain how New Fortress
Energy’s facility is connected to the interstate or intrastate transportation system or why
that consideration is no longer relevant. The Commission does offer some reasoning
when it declines to consider “whether a connected pipeline is engaged in transportation
(as opposed to some other function)” because “such a formulation could lead to the result
that the Commission’s jurisdiction would not attach to a large-scale LNG export terminal
that receives natural gas directly from nearby production and gathering facilities or an

underground and are used for carrying oil, gas, etc. over long distances”), with
Cambridge Dictionary, https://dictionary.cambridge.org/us/dictionary/english/pipe
(defining a “pipe” as “a tube inside which liquid or gas flows from one place to
another”), and Oxford Learner’s Dictionaries, https://www.oxfordlearnersdictionaries.
com/definition/american_english/pipe_1 (defining “pipe” as “a tube through which
liquids and gases can flow”).
12
See New Fortress Energy LLC, 174 FERC ¶ 61,207, at P 22 (2021).
13
Id.
14
Shell, 148 FERC ¶ 61,163 at P 43 n.78.
Docket No. CP20-466-000 -5-

import facility directly connected to a large local distribution company.” 15 Even

assuming this is an adequate rationale, it is not in accordance with the NGA. NGA
section 2(11) defines LNG terminal as including facilities that “are used to receive,
unload, load, store, transport, gasify, liquefy, or process” imported or exported natural
gas. 16

The majority’s determination that Shell remains good law and its finding that any
pipe, of any size and length, serving any purpose, can be deemed a “pipeline,” is at best
inconsistent and at worst renders Shell a nullity, reversing a decade of precedent without
actually doing the litigants the courtesy of coming out and saying so. Failure to explain
departure from policy is an obvious violation of the APA. 17 It is beyond cavil that an
agency must explain its departure from prior precedent and “may not . . . depart from a
prior policy sub silentio or simply disregard rules that are still on the books.” 18

If the Commission does not want to apply the finding in Shell, it should either
explicitly reverse that position or find that New Fortress Energy is non-jurisdictional.
Though I offer a word of warning should the majority decide to do so on rehearing: it
would be well-advised to establish some alternate limiting principle because, as flawed as
they may view Shell’s requirement that jurisdiction requires the facility to be connected
to a pipeline on the gas transportation system, if no other limit is established, they will
put us right back where the Commission was when it decided Shell: everything from
gathering facilities to LDCs to hypothetical Topeka rail yards will be subject to our
jurisdiction.

This abrupt reversal of policy is bad governance. 19 Nearly a decade has passed
since Shell. During that time, the LNG business has thrived. A great deal of capital has

15
New Fortress Energy LLC, 174 FERC ¶ 61,207 at P 23.
16
15 U.S.C. § 717a(11) (emphasis added).
17
See New England Power Generators Ass’n, Inc. v. FERC, 881 F.3d 202, 211
(D.C. Cir. 2018) (finding “that FERC did not engage in the reasoned decisionmaking
required by the Administrative Procedure Act” because it “failed to respond to the
substantial arguments put forward by Petitioners and failed to square its decision with its
past precedent”) (emphasis added).
18
FCC v. Fox Television Stations, Inc., 556 U.S. 502, 515 (2009) (“[T]he
requirement that an agency provide reasoned explanation for its action would ordinarily
demand that it display awareness that it is changing position.”) (emphasis in original).
19
This order circumvents Shell, rendering it meaningless, because anything with
any type of pipe in it to convey or handle LNG can be subject to our jurisdiction. What it
Docket No. CP20-466-000 -6-

been sought and deployed in reliance on the Commission’s issuances. Reversing course
on a matter of such consequence in a one-off adjudication is doubtless the Commission’s
prerogative under the APA. Whether the Commission can employ such a maneuver is
different from whether it should. As a matter of governance, when in doubt, and when
not compulsory, I would always disclaim jurisdiction. Prudence counsels the most
limited possible exercise of our authority to accomplish the objectives assigned to us by
Congress. To do otherwise is to insert ourselves into decision making that is best left to
others and in some cases, as here, to create obstacles to the development of the very
industries we are charged with encouraging and overseeing. 20

And in this case, what is the urgency? What remedy does the Commission have in
mind? For New Fortress Energy to cease operating? Surely not. To do so would all but
ensure that Puerto Rico has yet another reliability crisis. But we will require an NGA
section 3 application, the contents of which we cannot anticipate, and then roll the dice
and see if New Fortress Energy can be allowed to remain in operation. I question the
wisdom of this course of action.

If we are going to make this drastic change, we should do it by rulemaking or a

policy statement. I acknowledge that I did not vote for Shell in the first instance and may
not have were I on the Commission at the time. But given that Shell is the state of the
law, rather than nominally preserving it while rendering it ineffectual, we should limit the
statute’s broad jurisdictional language by imposing different limitations through a generic
proceeding that allows for notice and comment. Good governance (and fairness)
demand it.

For these reasons, I respectfully dissent.

________________________
James P. Danly
Commissioner

amounts to is another decision by the Commission to grant itself discretion as it picks and
choses which pipes are “pipelines” and which are just pipes.
20
See NAACP v. Fed. Power Comm’n, 425 U.S. 662, 669-70 (1976) (stating that
the Commission’s role in administering the NGA is to “encourage the orderly
development of plentiful supplies of . . . natural gas at reasonable prices”).
 UNITED STATES OF AMERICA
FEDERAL ENERGY REGULATORY COMMISSION

New Fortress Energy LLC Docket No. CP20-466-000

(Issued March 19, 2021)

CHRISTIE, Commissioner, concurring:

I concur in today’s order finding that New Fortress Energy LLC’s (New Fortress)
liquified natural gas (LNG) handling facility located at the Port of San Juan in Puerto
Rico is subject to the Commission’s jurisdiction under section 3 of the Natural Gas Act
(NGA). I write separately to explain my decision.

First, the order reasonably and consistently applies the Commission’s existing
Shell precedent 1 without expanding or, conversely, overturning it. The order makes
clear, consistent with Shell, that an LNG facility that does not receive or send out gas to
an end-user via a pipeline will not be subject to the Commission’s jurisdiction under
NGA section 3. The order also declines to further interpret the statutory text of NGA
section 3, or the Commission’s interpretation of that text in Shell, to arbitrarily define
what a “pipeline” may or may not be. Thus facilities, existing or planned, that relied on
Shell’s criteria for an LNG facility for purposes of this Commission’s section 3
jurisdiction will not and should not be affected by this order. 2

1
Shell U.S. Gas & Power, LLC, 148 FERC ¶ 61,163 (2014).
2
As a practical matter there is little doubt that substantial investments and plans
likely have been made in reliance on Shell and the Commission’s subsequent orders
applying it. Consequently, overturning or expanding the Commission’s original
reasoning in Shell here would be an exercise in changing a significant legal precedent that
has been in place for years and that has been relied on by many. To the extent the
Commission may choose to re-examine Shell, as advocated in the joint concurrence in
this proceeding of Chairman Glick and Commissioner Clements, I would strongly
encourage that such re-examination be conducted through a general proceeding in which
all interested persons, companies and groups are provided the opportunity to express their
views.
Docket No. CP20-466-000 -2-

I regard the facility at issue here as so functionally similar to the facility in

Aguirre, which was issued after Shell, as to be essentially indistinguishable. 3 That
facility was considered to be a jurisdictional LNG terminal under NGA section 3.

Finally, I recognize that PREPA, the public-power load-serving utility in Puerto

Rico, has made it abundantly clear that the continued operation of the New Fortress
facility is essential to PREPA’s ability to provide a reliable supply of electrical power to
Puerto Rico and its people. 4 I would not join this order absent its pledge that the New
Fortress facility will be allowed to continue operating throughout the process of obtaining
all necessary authorizations from this Commission. Given this facility’s critically
important role in providing power to Puerto Rico, shutting it down, directly or indirectly,
through the imposition of unreasonable regulatory burdens and costs, should not be part
of this Commission’s exercise of jurisdiction. As the order makes clear, there is no
“regulatory gap” that needs to be filled, as this facility is already regulated by several
federal and state agencies. 5

For these reasons, I respectfully concur.

______________________________
Mark C. Christie
Commissioner

3
Aguirre Offshore GasPort, LLC, 152 FERC ¶ 61,071 (2015). See also Order at P
20 n. 49.
4
See, e.g., PREPA’s Statement in Support for Continued Operation of New
Fortress Energy’s San Juan Harbor LNG Receiving Facility, Docket No. CP20-466-000
(filed March 16, 2021).
5
Order at PP 31-32.