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Environmental groups, states sue feds over LNG by rail

Federal regulation on transporting liquefied natural gas by rail goes into effect Monday

Federal regulation governing the transport of liquefied natural gas by rail is being challenged in court. (Photo: Jim Allen/FreightWaves)

Environmental groups, 14 states and the District of Columbia are suing federal agencies over regulation allowing the transport of liquefied natural gas (LNG) via rail.

The U.S. Department of Transportation (DOT) and the Pipeline and Hazardous Materials Safety Administration (PHMSA) in June authorized the bulk transportation of LNG by rail, and the rule was expected to take effect Monday, a month after it was published in the Federal Register.

The rule, which was made in consultation with the Federal Railroad Administration (FRA), allows for the bulk transportation of LNG using DOT-113 tank cars with enhanced outer tank requirements and additional operational controls.

But the states and the environmental groups argue that the rule violates the Administrative Procedure Act, the Hazardous Materials Transportation Act and the National Environmental Policy Act.

U.S. House Democrats have also criticized federal agencies for moving along with LNG-by-rail regulations, saying more reviews on the safety and operational practices to haul LNG via rail need to be conducted.

The environmental groups that filed the lawsuit before the U.S. Court of Appeals for the District of Columbia Circuit last Tuesday include the Sierra Club, Center for Biological Diversity, Clean Air Council, Delaware Riverkeeper Network, Environmental Confederation of Southwest Florida and Mountain Watershed Association.

The states bringing the lawsuit before the federal court are Maryland, New York, California, Delaware, Massachusetts, Michigan, Minnesota, New Jersey, Oregon, Pennsylvania, Rhode Island, Vermont, Washington and the District of Columbia.

The Trump administration has been eager to export LNG. PHMSA and FRA have said previously that the regulation is the result of President Trump’s executive order recognizing the growing role of the U.S. as a producer of LNG in both domestic and international markets.

Separately, PHMSA in December had granted a special permit to Energy Transport Solutions (ETS) to haul LNG by rail, stoking objections by some members of Congress who have expressed concerns over safety.

ETS, a logistics subsidiary of New Fortress Energy (NASDAQ: NFE), applied for the special permit in 2017. The company seeks to use specialized cryogenic railcars designed for supercooled liquids.

Click here for more FreightWaves articles by Joanna Marsh.

Related articles:

Feds issue final rule allowing liquefied natural gas by rail

Federal agency approves permit to transport liquefied natural gas via rail

House Democrats seek to slow White House plan for LNG rail shipments

DOT rolls out “freedom gas” rail plan

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.