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Company’s LNG-by-rail special permit expiring, putting projects in doubt

Permit for New Fortress Energy subsidiary Energy Transport Solutions was approved under Trump administration

A special permit allowing for the transport of LNG by rail is set to expire next week. (Photo: Jim Allen/FreightWaves)

A special permit that would enable New Fortress Energy to haul liquefied natural gas via rail is expiring next week, raising questions about whether the company will move forward with a series of related projects.

The permit, granted by the Pipeline and Hazardous Materials Safety Administration (PHMSA) on Dec. 5, 2019, allows Energy Transport Solutions, a subsidiary of New Fortress Energy, to transport refrigerated liquid methane in Department of Transportation specification 113C120W tank cars.

The permit, the existence of which environmental groups including Delaware Riverkeeper Network secured through a Freedom of Information Act request, expires next Tuesday.

For a special permit not to expire, the permit holder must file an application for renewal at least 60 days before the expiration date, per PHMSA regulations. No renewal application had been filed for this permit as of Tuesday.

That puts the status of New Fortress Energy’s LNG-by-rail plans in question, Delaware Riverkeeper said.

New Fortress Energy was planning to build an LNG export terminal in Gibbstown, New Jersey, and efforts to obtain state permits for that project are still ongoing since liquefied fracked gas could still be transported to the port via trucks, Delaware Riverkeeper said. 

But other plans by New Fortress Energy to construct a liquefaction plant in Wyalusing, Pennsylvania, build a pipeline to deliver feed gas to Wyalusing from shale gas wells and develop a fleet of railcars for LNG transport appear to be stalled or abandoned, according to Delaware Riverkeeper and other sources.

“Even with LNG-by-rail off the table, the proposal [for the LNG export terminal in Gibbstown] poses grave risks to the health and safety of residents along the transport route, and endangers both the Delaware River and the climate,” Delaware Riverkeeper said Monday in a release about the Energy Transport Solutions special permit. “Several permits for the export terminal are still pending before the administration [of New Jersey Governor Phil Murphy] with concerned local and Basin-wide organizations urging denial.”

New Fortress Energy did not return a request for comment.

The imminent expiration of the special permit comes as President Joe Biden’s administration is stepping back from regulations regarding LNG-by-rail. PHMSA recently said it is exploring temporarily pausing a rule allowing LNG-by-rail to provide more time to study safety issues. This action contrasts with efforts by former President Donald Trump in 2019 to ramp up the export of LNG or what he called “molecules of U.S. freedom.”

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Joanna Marsh

Joanna is a Washington, DC-based writer covering the freight railroad industry. She has worked for Argus Media as a contributing reporter for Argus Rail Business and as a market reporter for Argus Coal Daily.