The Federal Energy Regulatory Commission (hereafter ‘FERC’) and the Pipeline and Hazardous Material Safety Administration (hereafter ‘PHMSA’) have released a Memorandum of Understanding (hereafter ‘MOU’) outlining new efforts at coordination and collaboration in addressing liquid natural gas (hereafter ‘LNG’) facility proposals. The goal of this MOU is to improve coordination between the agencies to provide an overall increase in the efficiency and effectiveness of the LNG application review process. In order to accomplish this, the agencies have proposed a new method that would help avoid duplication efforts and maximize the exchange of relevant information in order to ensure that safety and security issues are addressed in a comprehensive manner.

Under the new MOU, FERC, upon receiving an application for an LNG facility, will notify PHMSA of the application and request a review of the proposed facility’s ability to comply with safety standards in 49 CFR 193, Subpart B. Additionally, FERC will notify PHMSA of the anticipated issuance date of its final NEPA document and of any withdrawal or rejection of the application.

PHMSA, for its part, will review the application for compliance with the referenced safety standards and then issue to FERC a letter of determination with its findings. This letter is to be issued within 30 days, otherwise PHMSA is required to notify FERC of an anticipated or experienced delay. FERC has agreed to treat PHMSA’s letter of determination as conclusive on the issue of compliance with the reviewed safety standards.

In order to expedite this process, the agencies have also agreed to some inspection, enforcement and document sharing rights. First, they have generally agreed to share information and inspection findings pertaining to the review of LNG operations. Next, the agencies agreed to share and/or provide access (as applicable) to all requested information and data submitted by the LNG applicants or operators to the extent permitted by law.

As document sharing among regulatory agencies can create thorny issues related to the dissemination of confidential information, the MOU includes a carve-out to provide protection. In it the agencies agree to mutually “share and protect” critical energy infrastructure information (CEII), sensitive security information (SSI) and privileged information, disclosing these types of information only when required by federal law or court order. As with all documents containing CEII, SSI or privileged information, proper labeling and redaction of information is essential prior to submittal to attempt any protection from disclosure.

For more detail on this MOU, follow this link: link