Natural gas plays a vital role in the U.S. energy supply and in achieving the nation's economic and environmental goals. Although natural gas production in North America is projected to gradually increase, consumption has begun to outpace available domestic natural gas supply. One of several proposed supply options would involve increasing imports of liquefied natural gas (LNG) to ensure that American consumers have adequate supplies of natural gas for the future.    

Natural gas consumption in the United States is expected to increase from about 22 trillion cubic feet (Tcf) in 2006 to 23 Tcf by 2030. Currently, most of the demand for natural gas in the United States is met with domestic production and imports via pipeline from Canada. A small but growing percentage of gas supplies are imported and received as liquefied natural gas. A significant portion of the world's natural gas resources are considered "stranded" because they are located far from any market.  Transportation of LNG by ship is one method to bring this stranded gas to the consumer.

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LNG is produced by taking natural gas from a production field, removing impurities, and liquefying the natural gas.  In the liquefaction process, the gas is cooled to a temperature of approximately-260 degrees F at ambient pressure. One volume of this condensed liquid form of natural gas takes up about 1/600th of the volume of natural gas at a stove burner tip. The LNG is loaded onto double-hulled ships which are used for both safety and insulating purposes. Once the ship arrives at the receiving port, the LNG is typically off-loaded into well-insulated storage tanks. Regasification is used to convert the LNG back into its gas form, which enters the domestic pipeline distribution system and is ultimately delivered to the end-user.

	The LNG Receiving Terminal at Lake Charles, LA

In 2007, the United States imported 771 billion cubic feet (Bcf) of LNG from a variety of exporting countries, but primarily from Trinidad and Tobago.  Imports in 2007 increased by 32 percent, from 584 Bcf in 2006. There are currently eight LNG import terminals located along the Atlantic and Gulf coasts. The mainland terminals are:  Everett, Massachusetts; Cove Point, Maryland; Elba Island, Georgia; Lake Charles, Louisiana; Sabine Pass, Louisiana; and Freeport, Texas. These six facilities have a cumulative baseload sendout capacity of approximately 8.3 Bcf/day. The offshore terminals are Gulf Gateway Energy Bridge in the Gulf of Mexico and Northeast Gateway located offshore Boston, with a baseload sendout capacity of 0.8 Bcf/day. As of June 2008, FERC reported 40 new facilities that have been approved or proposed to serve U.S. markets.

DOE's Role

The Department of Energy has regulatory, policy, and technology responsibilities related to LNG. The Office of Fossil Energy issues authorizations to import and export natural gas, by pipeline or as LNG, and conducts a data collection program to report annual and monthly levels of U.S. natural gas imports and exports. The Office facilitates coordination among federal agencies that have regulatory and policy authority for LNG. And, the Office has a lead role in addressing LNG technology and commercial issues.    

LNG and the Energy Policy Act of 2005

With the passage of the Energy Policy Act of 2005 (or EPAct), LNG was identified as an important energy resource that can help meet our country's rising energy demand.  Section 317 of EPAct required the Secretary of Energy, in cooperation and consultation with the Secretary of Transportation, the Secretary of Homeland Security, the Federal Energy Regulatory Commission, and the Governors of the Coastal States, to convene at least three forums on LNG to provide public education and foster dialogue among Federal officials, State and local officials, the general public, independent experts, and industry representatives. The purpose of the forums is to identify and develop best practices for addressing the issues and challenges associated with LNG imports, building on existing cooperative efforts.

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The forums were held in areas of the country in which LNG import facilities are under consideration.  Since there are a number of proposed facilities, regional meetings were held to provide an opportunity for the public to attend and participate.  The first LNG forum was held on March 10, 2006 in Boston, Massachusetts.; the second forum was held on March 28, 2006 in Astoria, Oregon; and the third forum was held on June 1, 2006 in Los Angeles, California. DOE met its EPAct requirement of Section 317 with the third LNG forum.  A fourth Department of Energy (DOE)-sponsored public education forum on LNG was held on November 29th, 2006 in Houston, Texas.

Technology R&D

The Liquefied Natural Gas Program supports the development and deployment of a steady stream of products and technologies that will progressively expand the nation's LNG system. Program areas include efforts to expand the public's understanding and acceptance of LNG, LNG safety, and R&D focused on advanced technologies for safe and efficient transportation and storage of LNG.

DOE/NARUC LNG Partnership

State public utility regulators and federal regulatory officials play an important role in the efficient development of LNG as an energy resource.

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DOE has partnered with the National Association of Regulatory Utility Commissioners (NARUC) to help educate energy decision makers and the public about LNG.

The Partnership is designed to enhance communications with stakeholders to ensure responsible development of state and regional strategies relating to LNG education, resource development and deployment. NARUC's members include agencies from the 50 states, the District of Columbia, Puerto Rico and the Virgin Islands that are responsible for regulating the activities of telecommunications, natural gas, electricity and water utilities.

Past LNG Activities

The Department hosted the Liquefied Natural Gas Ministerial Summit in December 2003. The Summit brought together energy ministers from more then 20 countries to exchange ideas on the developing global LNG market. It served as a forum to explore issues such as:

• Global natural gas resources. 
• The size and scale of existing and proposed supply projects.
• Export and import terminal facilities.
• Global LNG transportation.
• New and growing markets.
• Elements of the LNG value chain.
• New and emerging technology applications.
• Safety and facility security.
• Opportunities and barriers to investment. 

The Summit successfully identified concerns and issues that producing and consuming nations need to address so that a robust and efficient global LNG market can continue to develop.

The impetus for the LNG Ministerial Summit was the National Petroleum Council September 2003 report, Balancing Natural Gas Policy, Fueling the Demands of a Growing Economy, which was undertaken at the request of the Secretary of Energy.  This study found that traditional North American producing areas will be unable to fully meet projected natural gas demand. LNG imports were identified as a primary means for meeting future demand.