[Federal Register Volume 79, Number 214 (Wednesday, November 5, 2014)]
[Rules and Regulations]
[Pages 65541-65542]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-25143]
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DEPARTMENT OF ENERGY
10 CFR Part 590
Procedures for Changes in Control Affecting Applications and
Authorizations To Import or Export Natural Gas
AGENCY: Office of Fossil Energy, Department of Energy.
ACTION: Notice of procedures.
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SUMMARY: The U.S. Department of Energy's (DOE or the Department)
regulations require applications to export natural gas from the United
States to identify ``all the participants in the transaction, including
the parent company, if any, and identification of any corporate or
other affiliations among the participants.'' In many cases, either
before or after a final export authorization has been issued, ownership
or management of the exporting entity changes hands, resulting in a
change in control (CIC). This document sets forth procedures that will
apply when applicants to import or export natural gas or those entities
that have already received an import or export authorization undergo
changes in control.
DATES: Effective November 5, 2014, and applicable beginning September
26, 2014.
FOR FURTHER INFORMATION CONTACT:
Benjamin Nussdorf, U.S. Department of Energy (FE-34), Office of Oil and
Gas Global Security and Supply, Office of Fossil Energy, Forrestal
Building, Room 3E-052, 1000 Independence Avenue SW., Washington, DC
20585, (202) 586-7893.
Samuel Walsh, U.S. Department of Energy (GC-1), Office of the General
Counsel, Forrestal Building, 1000 Independence Avenue SW., Washington,
DC 20585, (202) 586-6732.
SUPPLEMENTARY INFORMATION:
I. Background
Pursuant to section 3(a) of the Natural Gas Act (NGA), 15 U.S.C.
717b(a), no person may import or export natural gas without
authorization from DOE, and DOE will approve such imports or exports
unless, after opportunity for a hearing, it determines that imports or
exports are not consistent with the public interest. Section 3(c) of
the NGA
[[Page 65542]]
provides that exports of natural gas to countries with which the United
States has entered into a free trade agreement (FTA) providing for
national treatment for trade in natural gas (FTA countries),\1\ and all
imports of liquefied natural gas (LNG) from any country, are deemed in
the public interest and must be granted without modification or delay.
15 U.S.C. 717b(c).
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\1\ ``Non-FTA countries'' refers to those nations with which the
United States has not entered into a FTA providing for national
treatment for trade in natural gas, and with which trade is not
prohibited by U.S. law or policy. DOE reviews applications for
exports of natural gas to non-FTA countries under NGA section 3(a).
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DOE's regulations at 10 CFR 590.204(b) require applicants to amend
pending applications whenever there are changes in material facts or
conditions upon which the proposal is based. Additionally, DOE's
regulations at 10 CFR 590.405 state that authorizations to import or
export natural gas shall not be transferable or assignable unless
specifically authorized by the Assistant Secretary for Fossil Energy.
In applying Sec. 590.405, DOE has made clear that a change in control
of the authorization holder may occur through asset sale or stock
transfer or by other means. DOE has also explained that it construes a
change in control to mean a change, directly or indirectly, of the
power to direct the management or policies of an entity whether such
power is exercised through one or more intermediary companies or
pursuant to an agreement, written or oral, and whether such power is
established through ownership or voting of securities, or common
directors, officers, or stockholders, or voting trusts, holding trusts,
or debt holdings, or contract, or any other direct or indirect means.
DOE has explained that a rebuttable presumption that control exists
will arise from the ownership or the power to vote, directly or
indirectly, 10 percent or more of the voting securities of such entity.
II. Discussion
This document announces new procedures to amend both applications
pending before DOE and authorizations already issued by DOE to reflect
changes in control of the proposed or actual importing or exporting
entity (or entities). These procedures are intended to streamline the
process for making these changes without affecting DOE's ability to
make the public interest determination required by Section 3(a) of the
NGA. These procedures do not affect the existing standard used by DOE
to determine if a change in control has occurred or will occur.
a. Timing
Entities may file notice of changes in control before such changes
have been effectuated but, in all cases, must file notice of changes in
control no later than 30 days after such changes have been effectuated
or 30 days after publication of this document, whichever is later,
unless good cause is shown for a later filing.
b. Non-FTA Natural Gas Export Applications and Authorizations
With respect to pending non-FTA export applications, i.e.,
proceedings in which DOE has not yet issued a final order, applicants
may amend their applications to reflect a change in control by
submitting notice of such amendment to DOE and serving that notice on
other parties in the proceeding, as provided in 10 CFR 590.107. DOE
will give immediate effect to the amendment but will accept and
consider answers to the notice of amendment received within 15 days of
service of the applicant's pleading. See 10 CFR 590.302(b). DOE then
will address the issues raised in any answers to such an amendment in
its final order on the pending application. Unless the opponents of the
change in control demonstrate that the change renders the underlying
application inconsistent with the public interest, or unless DOE
independently makes such a determination, no further action will be
taken by DOE on the change in control and the amendment will continue
to be given effect.
With respect to final non-FTA export authorizations already issued
by DOE, authorization holders may submit a statement of change in
control to DOE using one of the following methods: (1) Emailing the
filing to [email protected] with CIC and the FE Docket No. in the title
line; (2) mailing an original and three paper copies of the filing to
U.S. Department of Energy (FE-34), Office of Oil and Gas Global
Security and Supply, P.O. Box 44375, Washington, DC 20026-4375; or (3)
hand delivering an original and three paper copies of the filing to
U.S. Department of Energy (FE-34), Office of Oil and Gas Global
Security and Supply, Office of Fossil Energy, Forrestal Building, Room
3E-042, 1000 Independence Avenue SW., Washington, DC 20585.
Upon receipt of such a statement of change in control, DOE will
give effect to the change in control and will publish a notice of the
change in the Federal Register. Interested persons will be provided 15
days from the date of publication in the Federal Register in order to
move to intervene, protest, and answer the statement of change in
control. If no interested person protests the change in control and DOE
takes no action on its own motion, the amendment will be deemed granted
30 days after publication in the Federal Register. If one or more
protests are submitted, DOE will review any motions to intervene,
protests, and answers, and will issue a determination as to whether the
proposed change in control has been demonstrated to render the
underlying authorization inconsistent with the public interest.
c. FTA Long-Term Natural Gas Applications and Authorizations and Non-
FTA Long-Term LNG Import Applications and Authorizations
With respect to pending FTA long-term natural gas import or export
applications and pending non-FTA long-term LNG import applications,
applicants may amend their applications to reflect a change in control
by submitting a notice of such amendment to DOE. DOE will give
immediate effect to the amendment and take no further action.
With respect to FTA long-term natural gas import or export
authorizations and non-FTA long-term LNG import authorizations already
issued by DOE, authorization holders may submit a statement of change
in control to DOE using one of the three methods set forth above. Upon
receipt of the statement, DOE will give immediate effect to the change
in control and take no further action.
Long-term FTA applicants or authorization holders simultaneously
seeking to amend their non-FTA applications or authorizations may
provide notice to DOE of the change in control in a single notice or
statement, respectively, so long as the desired change to the long-term
FTA application or authorization is described clearly with reference to
the applicable orders or docket numbers.
This document is applicable beginning September 26, 2014.
Issued in Washington, DC, on October 16, 2014.
John A. Anderson,
Director, Division of Natural Gas Regulatory Activities, Office of Oil
and Gas Global Security and Supply, Office of Oil and Natural Gas.
[FR Doc. 2014-25143 Filed 11-4-14; 8:45 am]
BILLING CODE 6450-01-P