The Department of Energy appears poised to win a legal dispute over its analysis of environmental and climate risks of a massive planned liquefied natural gas export project in Alaska.
During oral arguments Monday, two judges of the U.S. Court of Appeals for the District of Columbia Circuit seemed skeptical of environmental groups’ challenge to DOE’s reauthorization of exports from Alaska LNG.
The project backed by the Alaska Gasline Development Corp. would enable commercialization of gas from Alaska’s remote North Slope by connecting it via pipeline to a planned liquefaction facility hundreds of miles across the state. Environmentalists have argued the project runs counter to the federal government’s broader goal of reducing the nation’s dependence on fossil fuels.
DOE reapproved exports from Alaska LNG in 2023, after it had agreed in mid-2021 to conduct a supplemental National Environmental Policy Act analysis of how the project would affect the climate. The agency affirmed its initial 2020 finding that the project was in the public interest.
The agency’s additional NEPA review of the project’s harms and benefits was “uneven,” with DOE finding more uncertainty about climate risks while determining that the project would be economically beneficial, Earthjustice attorney Moneen Nasmith told the D.C. Circuit on Monday.
But Judge Justin Walker questioned environmentalists’ decision to challenge the project under the Natural Gas Act.
“The statute you have chosen presumes the export of natural gas,” said the judge, a Trump appointee. “If your goal is to not have exports, the Natural Gas Act is a very odd vehicle to try to accomplish that.”
Nasmith countered that the Natural Gas Act does not require approval of all exports, but for a gas project to be legal under the law, the agency must adequately consider risks and harms.
“We have this incredibly unbalanced record,” she said.
The consolidated lawsuit from the Sierra Club and Center for Biological Diversity has played out as DOE has faced heightened pressure to reconsider how it accounts for climate change when it decides whether exports to nations that don’t have free-trade agreements with the U.S. are in the public interest.
DOE had temporarily paused new LNG export authorizations as it weighed the question, but the freeze did not include exports for projects like Alaska LNG that had already been authorized.
Senior Judge A. Raymond Randolph on Monday also questioned environmentalists’ claims about the risks posed by Alaska LNG.
“It seems to be absolutely impossible that any kind of a burning of the gas coming out of Prudhoe Bay is going to have any effect on global climate,” said Randolph, a George H.W. Bush appointee.
He also questioned the very premise that Earth is already experiencing warming.
“The problem with dealing with climate change as a harm for your members is it is not imminent,” Randolph said to Nasmith. “No matter how you cut it, the harm is 100 years away, it’s 50 years away.”
The scientific community widely agrees that the world is already feeling the effects of climate change, which researchers say can supercharge storms like Hurricane Helene, which last month devastated parts of the southeastern United States.
Nasmith said that the environmental groups had listed “particularized injuries” from Alaska LNG, which includes an 800-mile pipeline bisecting the Last Frontier to connect a gas treatment plant in Prudhoe Bay to a liquefaction facility on the Kenai Peninsula in the south-central part of the state.
DOE authorized the project in 2020 to export 929 billion cubic feet of gas per year to countries that don’t have free-trade agreements with the U.S.
Environmental groups claimed in court filings that the project would harm air quality and lead to destruction of more than 8,000 acres of wetlands, which would have significant effects on wildlife habitat and caribou.
Alaska LNG could also increase shipping traffic, posing risks of vessel strikes and habitat damage for the critically endangered Cook Inlet beluga whale. Just the construction and operation of the LNG facility over its 33-year expected life span would lead to the annual emissions equivalent of 827 to 1,357 gas-fired power plants.
Nasmith said the Natural Gas Act required DOE to reasonably explain its decision to authorize the project, and she said the case presents a narrow question to the court.
DOE defended its approach and told the D.C. Circuit during briefing that the Natural Gas Act gives the agency “broad discretion” in analyzing whether a project is publicly beneficial. The law only allows DOE to deny proposed exports if the agency finds a project is not in the public interest.
The agency had found the LNG project would make additional gas available to customers in Alaska and would help boost the local economy. At the same time, the project exports would have benefits for the country and for U.S. allies, the agency said.
“DOE took a hard look at all of the environmental impacts in this case, and they reasonably concluded that the project harms did not outweigh benefits,” said Justice Department attorney John Smeltzer.
“There is a lot of analysis that there will be continuing demand for DOE exports,” he added later.
Judge Brad Garcia, a Biden appointee, asked what the practical effects would be if the D.C. Circuit tossed out DOE’s export authorization.
Howard Nelson, an attorney with the firm Greenberg Traurig representing developers of Alaska LNG, said there are ongoing discussions to get funding and customers for the project. Scrapping the export authorization would be an “extreme obstacle” to getting $45 billion in investment, he said.
“There would be a lot more uncertainty if there was vacatur,” he said.
