US Delays in LNG, Coal Export Permitting Could Violate WTO Agreements

US Delays in LNG, Coal Export Permitting Could Violate WTO Agreements

The United States’ delay in permitting liquefied natural gas (LNG) and coal export facilities could run counter to U.S. international treaty obligations under World Trade Organization (WTO) agreements, former WTO Appellate Body Chairman James Bacchus argues in a recent report.

The United States cannot argue against trade restrictions by other countries while it delays the export of LNG and coal from the United States, Bacchus told reporters during a press conference Tuesday.

“It is strange to me that some in the energy industry see oil and gas as excluded from WTO obligations,” said Bacchus. “There’s nothing in the treaty that excludes oil and gas from WTO rules and obligations.”

As a WTO member, the United States must comply with WTO agreement trade rules. A key provision, the General Agreement on Tariffs and Trade (GATT) 1994, forbids export restrictions, including those made effective through licenses or other measures.

Bacchus and Rosa Jeong with Greenberg Traurig LLP conducted the study for the National Association of Manufacturers (NAM). The report, “LNG and COAL: Unreasonable Delays in Approving Exports Likely Violate International Treaty Obligations”, examined whether unreasonable delays by the U.S. Department of Energy in issuing LNG export licenses violate the United States’ obligations under the WTO.

The report also seeks to answer whether efforts by Pacific Northwest state and local authorities to broaden the environmental review process scope for coal export terminals beyond federal scope – and the resulting delay – violate U.S. international obligations under the WTO.

The United States has never exported significant quantities of LNG, but has a long history as a coal exporter to overseas markets. According to the report, LNG export projects currently undergo two separate phases of federal government approval by the Federal Energy Regulatory Commission (FERC) and the U.S. Department of Energy (DOE). FERC oversees the siting, construction and operation of LNG export facilities, while DOE grants licenses for the export of a limited volume of LNG over a certain period of time.


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Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Vernon Huffman | Dec. 7, 2013
It would be wonderful to have a global trade policy that serves everybody, but far more people are exploited by todays system than are served. We cannot allow exploitative corporations to use fossil fuels in a manner that endangers the future of humanity on this planet. Government regulations or no, these exports will be stopped.

Ben Calvin | Dec. 5, 2013
Way to go POTUS. 2016 wont come soon enough.

josh | Dec. 5, 2013
Just another one of Obamas ploys to destroy the United States by crippling the exportation of natural resources. He wants to shut down all coal facilities in the US. Wake up folks its not about the environment!


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