81 FR 59436 - Notice of Revised Procedures Affecting Applications and Authorizations for the In-Transit Movement of Natural Gas

DEPARTMENT OF ENERGY

Federal Register Volume 81, Issue 168 (August 30, 2016)

Page Range		59436-59437
FR Document		2016-20802

Pursuant to section 3(a) of the Natural Gas Act (NGA), no person may import or export natural gas without authorization from the Department of Energy (DOE), and DOE will approve such imports or exports unless, after opportunity for a hearing, it determines that the imports or exports are not consistent with the public interest. Section 3(c) of the NGA provides that imports and exports of natural gas from or 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), 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. This notice serves to clarify that in-transit shipments of natural gas, i.e., shipments of natural gas that only temporarily pass through the United States before returning to their country of origin, or temporarily pass through a foreign country before returning to the United States, for consumption or other disposition, are not ``imports'' or ``exports'' within the meaning of section 3 of the Natural Gas Act. However, DOE will impose monthly reporting requirements on persons making such shipments in order to ensure these movements meet the criteria defining in-transit shipments, and are tracked accordingly.

Federal Register, Volume 81 Issue 168 (Tuesday, August 30, 2016)

[Federal Register Volume 81, Number 168 (Tuesday, August 30, 2016)]
[Rules and Regulations]
[Pages 59436-59437]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-20802]


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DEPARTMENT OF ENERGY

10 CFR Part 590


Notice of Revised Procedures Affecting Applications and 
Authorizations for the In-Transit Movement of Natural Gas

AGENCY: Office of Fossil Energy, DOE.

ACTION: Notice of procedures.

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SUMMARY: Pursuant to section 3(a) of the Natural Gas Act (NGA), no 
person may import or export natural gas without authorization from the 
Department of Energy (DOE), and DOE will approve such imports or 
exports unless, after opportunity for a hearing, it determines that the 
imports or exports are not consistent with the public interest. Section 
3(c) of the NGA provides that imports and exports of natural gas from 
or 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), 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. This notice serves to clarify 
that in-transit shipments of natural gas, i.e., shipments of natural 
gas that only temporarily pass through the United States before 
returning to their country of origin, or temporarily pass through a 
foreign country before returning to the United States, for consumption 
or other disposition, are not ``imports'' or ``exports'' within the 
meaning of section 3 of the Natural Gas Act. However, DOE will impose 
monthly reporting requirements on persons making such shipments in 
order to ensure these movements meet the criteria defining in-transit 
shipments, and are tracked accordingly.

DATES: Effective August 30, 2016.

FOR FURTHER INFORMATION CONTACT: 
Brian Lavoie or Larine Moore, U.S. Department of Energy (FE-34), Office 
of Regulation and International Engagement, Office of Fossil Energy, 
Forrestal Building, Room 3E-042, 1000 Independence Avenue SW., 
Washington, DC 20585, (202) 586-2459; (202) 586-9478.
Edward Myers, U.S. Department of Energy (GC-76), Office of the 
Assistant General Counsel for Electricity and Fossil Energy, Forrestal 
Building, 1000 Independence Avenue SW., Washington, DC 20585, (202) 
586-3397.

SUPPLEMENTARY INFORMATION: 

I. Background

    In DOE/FE Order No. 3769,\1\ DOE concluded that ``Congress likely 
did not intend the words ``import'' and ``export'' to capture any 
movement of natural gas across the U.S. border, but rather intended to 
leave some discretion to the Federal Power Commission (the [DOE's] 
predecessor in administering NGA Section 3, 15 U.S.C. 717b) on that 
question.'' \2\ Further, DOE concluded that ``in-transit shipments 
returning to the country of origin are not imports or exports within 
the meaning of section 3 of the Natural Gas Act.'' \3\ Consequently, 
DOE concluded ``that in-transit shipments returning to the country of 
origin fall outside [DOE's] jurisdiction under NGA section 3.'' \4\ 
This Notice sets forth procedures for the submission of information 
concerning in-transit shipments returning to the country of origin.
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    \1\ Bear Head LNG Corporation & Bear Head LNG, LLC, DOE/FE Order 
No. 3769, FE Docket No. 15-14-NG, Opinion and Order Dismissing 
Application for In-Transit Shipments of Canadian-Sourced Natural Gas 
and Directing Submission of Information Concerning In-Transit 
Shipments Returning to the Country of Origin (Feb. 5, 2016).
    \2\ Id. at 8.
    \3\ Id. at 9.
    \4\ Id. at 10.
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    DOE considers an ``in-transit shipment returning to the country of 
origin'' as a shipment of natural gas through the United States between 
points of a single foreign nation, or through a single foreign nation 
between points in the United States, that are physical and direct. 
``Physical'' means that the natural gas will be transported between two 
cross-border points. Thus, exchanges by backhaul or displacement, or 
other virtual shipments, do not qualify as in-transit shipments for

[[Page 59437]]

purposes of this Order. ``Direct'' means that the natural gas must not 
be diverted for other purposes but must travel a commercially 
reasonable path between points in one country consistent with an 
intention merely to transit the other country. And, consistent with the 
U.S. Customs and Border Patrol regulations concerning in-transit 
shipments,\5\ to qualify as ``in-transit'' the natural gas must cross 
points of entry and exit at the United States border within a 30-day 
period. DOE expects the reporting of in-transit volumes--noting any 
line losses and/or natural gas that may be consumed as fuel during the 
transit process--to be made to the Department within 30 days following 
the month during which the in-transit shipment took place. The purpose 
of reporting the in-transit volumes is to confirm the non-
jurisdictional status of such shipments and to understand the extent to 
which imports and exports are affecting the domestic natural gas 
market, and what movements of natural gas are limited to utilizing 
natural gas infrastructure and not directly impacting natural gas 
supply or demand. Additional information on reporting volumes is 
available at: http://energy.gov/fe/services/natural-gas-regulation/guidelines-filing-monthly-reports.
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    \5\ See 19 CFR 18.31, 18.2(c)(2).
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II. Reporting Requirements for In-Transit Shipments of Natural Gas

    a. The entity holding title to the natural gas as it crosses 
borders shall file with the Office of Regulation and International 
Engagement, a report due not later than the 30th day of the month 
following the month of completion of an in-transit shipment. The report 
must give the following details of each in-transit shipment returning 
to the country of origin, including cases where natural gas originates 
from the United States and undergoes in-transit shipment and where 
natural gas originates in another country and transits the United 
States: (1) The name of the country that is both the origin and final 
destination, (2) the name of the country through which the gas is 
transported before returning to the origin country (the transit 
country--this may be either the United States or another country) (3) 
the initial border crossing point, (4) the foreign pipeline at the 
initial border crossing point, (5) the U.S. pipeline at the initial 
border crossing point, (6) the final border crossing point, (7) the 
foreign pipeline at the final border crossing point, (8) the U.S. 
pipeline at the final border crossing point, (9) the volume of natural 
gas moving through the final border crossing point, (10) the month and 
year in which the in-transit shipment took place, (11) the name of the 
entity that has title to the natural gas during the in-transit 
movement, (12) the name of the individual who prepared the report, and 
(13) contact information.

(Approved by the Office of Management and Budget under OMB Control No. 
1901-0294.)

    b. To show that no deliveries into or out of United States 
commercial markets have occurred, DOE/FE additionally requests 
clarification in monthly reports for in-transit shipments specifying 
the difference in volumes entering the transit country and volumes 
leaving the transit country and the reason for any such differences, to 
the extent the information is available.
    c. The entity holding title to the natural gas as it crosses 
borders shall maintain copies of the reports filed under paragraph a., 
supra, for each in-transit shipment returning to the country of origin 
for a period of one year after completion of the in-transit shipment, 
and provide that information to DOE/FE upon request.
    d. All monthly report filings shall be made to U.S. Department of 
Energy (FE-34), Office of Fossil Energy, Office of Regulation and 
International Engagement, P.O. Box 44375, Washington, DC 20026-4375, 
Attention: Natural Gas Reports. Alternatively, reports may be emailed 
to [email protected], or may be faxed to Natural Gas Reports at 
(202) 586-6050.
    e. Companies that currently use import and export authorizations to 
report in-transit natural gas shipments may continue to report under 
their authorizations, but no new authorizations dedicated solely to in-
transit shipments will be issued. Companies should not apply for new 
import and export authorizations if they plan on only conducting in-
transit natural gas transactions.
    f. Companies may use approved OMB information collection forms, 
which will be available on DOE/FE's Web site at: http://www.energy.gov/fe/services/natural-gas-regulation/in-transit.
    g. Companies can submit in-transit reports without docket or order 
numbers, if not reporting under authorizations permitting both imports 
and exports.
    This Notice is effective immediately upon issuance.

    Issued in Washington, DC, on August 23, 2016.
John A. Anderson,
Director, Office of Regulation and International Engagement, Office of 
Oil and Natural Gas.
[FR Doc. 2016-20802 Filed 8-29-16; 8:45 am]
 BILLING CODE 6450-01-P

59436 Federal Register / Vol. 81, No. 168 / Tuesday, August 30, 2016 / Rules and Regulations

vaccinations, such recommendations § 114.11 Storage and handling. in-transit shipments, and are tracked
must be supported by data acceptable to Biological products at licensed accordingly.
APHIS. In the absence of data that establishments must be protected at all DATES: Effective August 30, 2016.
establish the need for booster times against improper storage and
FOR FURTHER INFORMATION CONTACT:
vaccination, labeling must bear the handling. Completed product must be
kept under refrigeration at 35 to 46 °F Brian Lavoie or Larine Moore, U.S.
following statement: ‘‘The need for
(2 to 8 °C), unless the inherent nature Department of Energy (FE–34), Office
annual booster vaccinations has not
of the product makes storage at different of Regulation and International
been established for this product;
temperatures advisable, in which case, Engagement, Office of Fossil Energy,
consultation with a veterinarian is
the proper storage temperature must be Forrestal Building, Room 3E–042,
recommended.’’
specified in the filed Outline of 1000 Independence Avenue SW.,
* * * * * Washington, DC 20585, (202) 586–
(i) All but very small final container Production. All biological products to
be shipped or delivered must be 2459; (202) 586–9478.
labels for feline panleukopenia vaccines Edward Myers, U.S. Department of
shall contain the following securely packed.
Energy (GC–76), Office of the
recommendations for use: Done in Washington, DC, this 24th day of Assistant General Counsel for
(1) Killed virus vaccines. Vaccinate August 2016.
Electricity and Fossil Energy,
healthy cats with one dose, except that Elvis S. Cordova, Forrestal Building, 1000
if the animal is less than 12 weeks of Deputy Under Secretary for Marketing and Independence Avenue SW.,
age, a second dose should be given no Regulatory Programs. Washington, DC 20585, (202) 586–
earlier than 16 weeks of age. [FR Doc. 2016–20749 Filed 8–29–16; 8:45 am] 3397.
(2) Modified live virus vaccines. BILLING CODE 3410–34–P
Vaccinate healthy cats with one dose, SUPPLEMENTARY INFORMATION:
except that if the animal is less than 12 I. Background
weeks of age, a second dose should be DEPARTMENT OF ENERGY
given no earlier than16 weeks of age. In DOE/FE Order No. 3769,1 DOE
* * * * * 10 CFR Part 590 concluded that ‘‘Congress likely did not
(l) All labels for autogenous biologics intend the words ‘‘import’’ and ‘‘export’’
must specify the name of the Notice of Revised Procedures to capture any movement of natural gas
microorganism(s) or antigen(s) that they Affecting Applications and across the U.S. border, but rather
contain, and shall bear the following Authorizations for the In-Transit intended to leave some discretion to the
statement: ‘‘Potency and efficacy of Movement of Natural Gas Federal Power Commission (the [DOE’s]
autogenous biologics have not been predecessor in administering NGA
AGENCY: Office of Fossil Energy, DOE. Section 3, 15 U.S.C. 717b) on that
established. This product is prepared for
ACTION: Notice of procedures. question.’’ 2 Further, DOE concluded
use only by or under the direction of a
veterinarian or approved specialist.’’ SUMMARY: Pursuant to section 3(a) of the that ‘‘in-transit shipments returning to
Natural Gas Act (NGA), no person may the country of origin are not imports or
* * * * *
import or export natural gas without exports within the meaning of section 3
(n) All labels for conditionally
authorization from the Department of of the Natural Gas Act.’’ 3 Consequently,
licensed products shall bear the
Energy (DOE), and DOE will approve DOE concluded ‘‘that in-transit
following statement: ‘‘This product
such imports or exports unless, after shipments returning to the country of
license is conditional; efficacy and
opportunity for a hearing, it determines origin fall outside [DOE’s] jurisdiction
potency have not been fully
that the imports or exports are not under NGA section 3.’’ 4 This Notice
demonstrated.’’
consistent with the public interest. sets forth procedures for the submission
* * * * * of information concerning in-transit
Section 3(c) of the NGA provides that
imports and exports of natural gas from shipments returning to the country of
PART 113—STANDARD
or to countries with which the United origin.
REQUIREMENTS
States has entered into a free trade DOE considers an ‘‘in-transit
■ 11. The authority citation for part 113 agreement (FTA) providing for national shipment returning to the country of
continues to read as follows: treatment for trade in natural gas (FTA origin’’ as a shipment of natural gas
countries), and all imports of liquefied through the United States between
Authority: 21 U.S.C. 151–159; 7 CFR 2.22,
2.80, and 371.4. natural gas (LNG) from any country, are points of a single foreign nation, or
deemed in the public interest and must through a single foreign nation between
§ 113.206 [Amended]
be granted without modification or points in the United States, that are
■ 12. In § 113.206, paragraph (d)(2) is delay. This notice serves to clarify that physical and direct. ‘‘Physical’’ means
amended by removing the reference in-transit shipments of natural gas, i.e., that the natural gas will be transported
‘‘§ 112.7(i)’’ and adding the reference shipments of natural gas that only between two cross-border points. Thus,
‘‘§ 112.7(h)’’ in its place. temporarily pass through the United exchanges by backhaul or displacement,
States before returning to their country or other virtual shipments, do not
PART 114—PRODUCTION of origin, or temporarily pass through a qualify as in-transit shipments for
REQUIREMENTS FOR BIOLOGICAL foreign country before returning to the 1 Bear Head LNG Corporation & Bear Head LNG,
PRODUCTS United States, for consumption or other LLC, DOE/FE Order No. 3769, FE Docket No. 15–
mstockstill on DSK3G9T082PROD with RULES

disposition, are not ‘‘imports’’ or 14–NG, Opinion and Order Dismissing Application
■ 13. The authority citation for part 114
‘‘exports’’ within the meaning of section for In-Transit Shipments of Canadian-Sourced
continues to read as follows: Natural Gas and Directing Submission of
3 of the Natural Gas Act. However, DOE
Authority: 21 U.S.C. 151–159; 7 CFR 2.22, Information Concerning In-Transit Shipments
will impose monthly reporting Returning to the Country of Origin (Feb. 5, 2016).
2.80, and 371.4. requirements on persons making such 2 Id. at 8.

■ 14. Section 114.11 is revised to read shipments in order to ensure these 3 Id. at 9.

as follows: movements meet the criteria defining 4 Id. at 10.

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Federal Register / Vol. 81, No. 168 / Tuesday, August 30, 2016 / Rules and Regulations 59437

purposes of this Order. ‘‘Direct’’ means crossing point, (10) the month and year Issued in Washington, DC, on August 23,
that the natural gas must not be diverted in which the in-transit shipment took 2016.
for other purposes but must travel a place, (11) the name of the entity that John A. Anderson,
commercially reasonable path between has title to the natural gas during the in- Director, Office of Regulation and
points in one country consistent with an transit movement, (12) the name of the International Engagement, Office of Oil and
intention merely to transit the other Natural Gas.
individual who prepared the report, and
country. And, consistent with the U.S. (13) contact information. [FR Doc. 2016–20802 Filed 8–29–16; 8:45 am]
Customs and Border Patrol regulations BILLING CODE 6450–01–P
concerning in-transit shipments,5 to (Approved by the Office of Management
qualify as ‘‘in-transit’’ the natural gas and Budget under OMB Control No.
must cross points of entry and exit at 1901–0294.) FARM CREDIT SYSTEM INSURANCE
the United States border within a 30-day CORPORATION
b. To show that no deliveries into or
period. DOE expects the reporting of in-
out of United States commercial markets
transit volumes—noting any line losses 12 CFR Part 1402
and/or natural gas that may be have occurred, DOE/FE additionally
requests clarification in monthly reports RIN 3055–AA12
consumed as fuel during the transit
process—to be made to the Department for in-transit shipments specifying the
difference in volumes entering the Releasing Information; Availability of
within 30 days following the month Records of the Farm Credit System
during which the in-transit shipment transit country and volumes leaving the
Insurance Corporation; Fees for
took place. The purpose of reporting the transit country and the reason for any
Provision of Information
in-transit volumes is to confirm the non- such differences, to the extent the
jurisdictional status of such shipments information is available. AGENCY: Farm Credit System Insurance
and to understand the extent to which c. The entity holding title to the Corporation.
imports and exports are affecting the natural gas as it crosses borders shall ACTION: Final rule.
domestic natural gas market, and what maintain copies of the reports filed
movements of natural gas are limited to SUMMARY: The Farm Credit System
under paragraph a., supra, for each in-
utilizing natural gas infrastructure and Insurance Corporation (Corporation)
transit shipment returning to the
not directly impacting natural gas issues a final rule amending its
country of origin for a period of one year
supply or demand. Additional regulations to reflect changes to the
information on reporting volumes is after completion of the in-transit Freedom of Information Act (FOIA). The
available at: http://energy.gov/fe/ shipment, and provide that information FOIA Improvement Act of 2016 requires
services/natural-gas-regulation/ to DOE/FE upon request. the Corporation to amend its FOIA
guidelines-filing-monthly-reports. d. All monthly report filings shall be regulations to extend the deadline for
made to U.S. Department of Energy (FE– administrative appeals, to add
II. Reporting Requirements for In-
34), Office of Fossil Energy, Office of information on dispute resolution
Transit Shipments of Natural Gas
Regulation and International services, and to amend the way the
a. The entity holding title to the Engagement, P.O. Box 44375, Corporation charges fees.
natural gas as it crosses borders shall Washington, DC 20026–4375, Attention: DATES: Effective date: This regulation
file with the Office of Regulation and will become effective October 1, 2016.
Natural Gas Reports. Alternatively,
International Engagement, a report due
reports may be emailed to ngreports@ FOR FURTHER INFORMATION CONTACT:
not later than the 30th day of the month
following the month of completion of an hq.doe.gov, or may be faxed to Natural Howard Rubin, General Counsel, Farm
in-transit shipment. The report must Gas Reports at (202) 586–6050. Credit System Insurance Corporation,
give the following details of each in- e. Companies that currently use 1501 Farm Credit Drive, McLean,
transit shipment returning to the import and export authorizations to Virginia 22102, (703) 883–4380, TTY
country of origin, including cases where report in-transit natural gas shipments (703) 883–4390.
natural gas originates from the United may continue to report under their SUPPLEMENTARY INFORMATION:
States and undergoes in-transit authorizations, but no new I. Objective
shipment and where natural gas authorizations dedicated solely to in-
originates in another country and transit shipments will be issued. The objective of this final rule is to
transits the United States: (1) The name reflect changes to the FOIA by the FOIA
Companies should not apply for new
of the country that is both the origin and Improvement Act of 2016 (Improvement
import and export authorizations if they
final destination, (2) the name of the Act). The Improvement Act addresses a
plan on only conducting in-transit
country through which the gas is range of procedural issues, including
natural gas transactions. requirements that agencies establish a
transported before returning to the
origin country (the transit country—this f. Companies may use approved OMB minimum of 90 days for requesters to
may be either the United States or information collection forms, which file an administrative appeal and that
another country) (3) the initial border will be available on DOE/FE’s Web site they provide dispute resolution services
crossing point, (4) the foreign pipeline at: http://www.energy.gov/fe/services/ at various times throughout the FOIA
at the initial border crossing point, (5) natural-gas-regulation/in-transit. process. The Improvement Act also
the U.S. pipeline at the initial border g. Companies can submit in-transit updates how fees are assessed.
crossing point, (6) the final border reports without docket or order We revise the regulations as follows:
mstockstill on DSK3G9T082PROD with RULES

crossing point, (7) the foreign pipeline (1) In § 1402.14,
numbers, if not reporting under
at the final border crossing point, (8) the a. By changing the appeals deadline
authorizations permitting both imports
U.S. pipeline at the final border crossing from 30 days to 90 days in paragraph
and exports.
point, (9) the volume of natural gas (b);
moving through the final border This Notice is effective immediately b. By adding FCSIC’s FOIA Public
upon issuance. Liaison and the Office of Government
5 See 19 CFR 18.31, 18.2(c)(2). Information Services to the list of offices

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Document Created: 2018-02-09 11:42:23
Document Modified: 2018-02-09 11:42:23

Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Rules and Regulations
Action		Notice of procedures.
Dates		Effective August 30, 2016.
Contact		Brian Lavoie or Larine Moore, U.S. Department of Energy (FE-34), Office of Regulation and International Engagement, Office of Fossil Energy, Forrestal Building, Room 3E-042, 1000 Independence Avenue SW., Washington, DC 20585, (202) 586-2459; (202) 586-9478. Edward Myers, U.S. Department of Energy (GC-76), Office of the Assistant General Counsel for Electricity and Fossil Energy, Forrestal Building, 1000 Independence Avenue SW., Washington, DC 20585, (202) 586-3397.
FR Citation		81 FR 59436