Trump orders pipeline, LNG permitting overhaul: Update

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President Donald Trump is signing two executive orders today seeking changes to rules that have thrown up hurdles to projects such as the Keystone XL crude pipeline and natural gas pipelines in New York.

The executive orders envision overhauling permitting rules for pipelines and LNG facilities. They instruct federal agencies to prioritize updates to water permitting regulations and safety standards that the energy sector says have stalled numerous projects.

Trump said the "groundbreaking" orders will spur regulators to attempt to attempt to reach some permitting decisions within six months and help increase energy production.

"My action today will cut through destructive permitting delays and denials," he said at an engineering training facility near Houston. "Do you know about delays where it takes you 20 years to get a permit? Those days are gone."

Trump is signing the orders as he gears up for a re-election bid based in part on the success of his "energy dominance" agenda. Oil and gas production has boomed since Trump took office two years ago but he has struggled to deliver on promises to speed infrastructure permitting, including enabling pipeline operator TransCanada to build the long-delayed, 830,000 b/d Keystone XL pipeline.

Trump said today that "badly needed infrastructure" was being held back by special interest groups, activists and bureaucrats. He blamed New York specifically for blocking the 628mn cf/d Constitution natural gas pipeline, which has been unable to start construction because the state in 2016 declined to give the project a needed "section 401" water quality permit.

"New York is hurting the country because they are not allowing us to get those pipelines through, and that is why they are paying so much for their heating," Trump said. "Hopefully they can come on board and get in line with what is happening."

The first executive order focuses broadly on promoting energy infrastructure. It will attempt to limit the ability of states to use section 401 water permits to block pipelines by ordering the US Environmental Protection Agency to update its rules and guidance to states.

Natural gas industry officials applauded Trump for attempting to revise water permitting rules they say states have abused to block pipelines, although they concede water permitting for pipelines could remain a hurdle without legislative changes that are unlikely to pass in a politically divided Congress.

Natural Gas Supply Association president Dena Wiggins said the order takes a step toward fixing "broken parts of the state water certification process for pipelines" and would take politics out of the permitting process.

The executive order will also direct the US transportation secretary to update 40-year-old safety standards for LNG liquefaction facilities and revise existing rules that prohibit the transportation of LNG on rail cars. Those rules have "failed to adapt to recognize industry best practices and modern technologies," a senior administration official said.

A second executive order aims to streamline permitting for cross-border oil pipelines. The order would revoke a policy that gave the US State Department responsibility to permit those projects, a process that has become a source of delays and litigation. Instead, that authority would reside exclusively with the president. The State Department could still advise the president but would have to do so within 60 days.

The order appears to align with Trump's decision on 29 March to reissue a presidential permit for the 1,180-mile (1,900km) Keystone XL pipeline, which would transport oil sands from Canada to the US. The administration this week asked a federal court to throw out litigation around an earlier presidential permit that was approved under the previous process.