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FERC Denies Rehearing in Elba Expansion

The Commission issued an order Tuesday denying rehearing and granting reconsideration of Southern LNG, Inc.'s Elba Island expansion project (Elba III). Notably, FERC rejected charges by Marathon LNG that the Commission exceeded its statutory authority by approving rates related to the Section 3 expansion and violated FERC rules by the manner in which the rates were approved. FERC explained that limitations on its authority in the Energy Policy Act of 2005 must be construed narrowly. The Commission "interpret[s] the statute to preclude the Commission from requiring any particular rate, term or condition of service on new or expanded LNG terminal facilities [but] the proponent of the LNG terminal may voluntarily propose to offer services under our open-access transportation program." The order is available in FERC's eLibrary in Docket No. CP06-470-001.

Full post as published by LNG Law Blog on February 22, 2008 (boomark / email).