Natural Gas Act Section 3

§ 717b

TITLE 15—COMMERCE AND TRADE

outside thereof, or between points within the
same State but through any place outside
thereof, but only insofar as such commerce
takes place within the United States.
(8) ‘‘State commission’’ means the regulatory body of the State or municipality having jurisdiction to regulate rates and charges
for the sale of natural gas to consumers within
the State or municipality.
(9) ‘‘Commission’’ and ‘‘Commissioner’’
means the Federal Power Commission, and a
member thereof, respectively.
(10) ‘‘Vehicular natural gas’’ means natural
gas that is ultimately used as a fuel in a selfpropelled vehicle.
(11) ‘‘LNG terminal’’ includes all natural gas
facilities located onshore or in State waters
that are used to receive, unload, load, store,
transport, gasify, liquefy, or process natural
gas that is imported to the United States from
a foreign country, exported to a foreign country from the United States, or transported in
interstate commerce by waterborne vessel, but
does not include—
(A) waterborne vessels used to deliver natural gas to or from any such facility; or
(B) any pipeline or storage facility subject
to the jurisdiction of the Commission under
section 717f of this title.
(June 21, 1938, ch. 556, § 2, 52 Stat. 821; Pub. L.
102–486, title IV, § 404(a)(2), Oct. 24, 1992, 106 Stat.
2879; Pub. L. 109–58, title III, § 311(b), Aug. 8, 2005,
119 Stat. 685.)
AMENDMENTS
2005—Par. (11). Pub. L. 109–58 added par. (11).
1992—Par. (10). Pub. L. 102–486 added par. (10).
TERMINATION OF FEDERAL POWER COMMISSION;
TRANSFER OF FUNCTIONS
Federal Power Commission terminated and functions,
personnel, property, funds, etc., transferred to Secretary of Energy (except for certain functions transferred to Federal Energy Regulatory Commission) by
sections 7151(b), 7171(a), 7172(a)(1), 7291, and 7293 of Title
42, The Public Health and Welfare.

§ 717b. Exportation or importation of natural gas;
LNG terminals
(a) Mandatory authorization order
After six months from June 21, 1938, no person
shall export any natural gas from the United
States to a foreign country or import any natural gas from a foreign country without first having secured an order of the Commission authorizing it to do so. The Commission shall issue
such order upon application, unless, after opportunity for hearing, it finds that the proposed exportation or importation will not be consistent
with the public interest. The Commission may
by its order grant such application, in whole or
in part, with such modification and upon such
terms and conditions as the Commission may
find necessary or appropriate, and may from
time to time, after opportunity for hearing, and
for good cause shown, make such supplemental
order in the premises as it may find necessary or
appropriate.
(b) Free trade agreements
With respect to natural gas which is imported
into the United States from a nation with which

Page 1014

there is in effect a free trade agreement requiring national treatment for trade in natural gas,
and with respect to liquefied natural gas—
(1) the importation of such natural gas shall
be treated as a ‘‘first sale’’ within the meaning
of section 3301(21) of this title; and
(2) the Commission shall not, on the basis of
national origin, treat any such imported natural gas on an unjust, unreasonable, unduly discriminatory, or preferential basis.
(c) Expedited application and approval process
For purposes of subsection (a) of this section,
the importation of the natural gas referred to in
subsection (b) of this section, or the exportation
of natural gas to a nation with which there is in
effect a free trade agreement requiring national
treatment for trade in natural gas, shall be
deemed to be consistent with the public interest, and applications for such importation or exportation shall be granted without modification
or delay.
(d) Construction with other laws
Except as specifically provided in this chapter,
nothing in this chapter affects the rights of
States under—
(1) the Coastal Zone Management Act of 1972
(16 U.S.C. 1451 et seq.);
(2) the Clean Air Act (42 U.S.C. 7401 et seq.);
or
(3) the Federal Water Pollution Control Act
(33 U.S.C. 1251 et seq.).
(e) LNG terminals
(1) The Commission shall have the exclusive
authority to approve or deny an application for
the siting, construction, expansion, or operation
of an LNG terminal. Except as specifically provided in this chapter, nothing in this chapter is
intended to affect otherwise applicable law related to any Federal agency’s authorities or responsibilities related to LNG terminals.
(2) Upon the filing of any application to site,
construct, expand, or operate an LNG terminal,
the Commission shall—
(A) set the matter for hearing;
(B) give reasonable notice of the hearing to
all interested persons, including the State
commission of the State in which the LNG terminal is located and, if not the same, the Governor-appointed State agency described in section 717b–1 of this title;
(C) decide the matter in accordance with
this subsection; and
(D) issue or deny the appropriate order accordingly.
(3)(A) Except as provided in subparagraph (B),
the Commission may approve an application described in paragraph (2), in whole or part, with
such modifications and upon such terms and
conditions as the Commission find 1 necessary or
appropriate.
(B) Before January 1, 2015, the Commission
shall not—
(i) deny an application solely on the basis
that the applicant proposes to use the LNG
terminal exclusively or partially for gas that
the applicant or an affiliate of the applicant
will supply to the facility; or
1 So

in original. Probably should be ‘‘finds’’.

Page 1015

(ii) condition an order on—
(I) a requirement that the LNG terminal
offer service to customers other than the applicant, or any affiliate of the applicant, securing the order;
(II) any regulation of the rates, charges,
terms, or conditions of service of the LNG
terminal; or
(III) a requirement to file with the Commission schedules or contracts related to the
rates, charges, terms, or conditions of service of the LNG terminal.
(C) Subparagraph (B) shall cease to have effect
on January 1, 2030.
(4) An order issued for an LNG terminal that
also offers service to customers on an open access basis shall not result in subsidization of expansion capacity by existing customers, degradation of service to existing customers, or
undue discrimination against existing customers as to their terms or conditions of service
at the facility, as all of those terms are defined
by the Commission.
(f) Military installations
(1) In this subsection, the term ‘‘military installation’’—
(A) means a base, camp, post, range, station,
yard, center, or homeport facility for any ship
or other activity under the jurisdiction of the
Department of Defense, including any leased
facility, that is located within a State, the
District of Columbia, or any territory of the
United States; and
(B) does not include any facility used primarily for civil works, rivers and harbors
projects, or flood control projects, as determined by the Secretary of Defense.
(2) The Commission shall enter into a memorandum of understanding with the Secretary of
Defense for the purpose of ensuring that the
Commission coordinate and consult 2 with the
Secretary of Defense on the siting, construction,
expansion, or operation of liquefied natural gas
facilities that may affect an active military installation.
(3) The Commission shall obtain the concurrence of the Secretary of Defense before authorizing the siting, construction, expansion, or operation of liquefied natural gas facilities affecting the training or activities of an active military installation.
(June 21, 1938, ch. 556, § 3, 52 Stat. 822; Pub. L.
102–486, title II, § 201, Oct. 24, 1992, 106 Stat. 2866;
Pub. L. 109–58, title III, § 311(c), Aug. 8, 2005, 119
Stat. 685.)
REFERENCES IN TEXT
The Coastal Zone Management Act of 1972, referred to
in subsec. (d)(1), is title III of Pub. L. 89–454 as added by
Pub. L. 92–583, Oct. 27, 1972, 86 Stat. 1280, as amended,
which is classified generally to chapter 33 (§ 1451 et seq.)
of Title 16, Conservation. For complete classification of
this Act to the Code, see Short Title note set out under
section 1451 of Title 16 and Tables.
The Clean Air Act, referred to in subsec. (d)(2), is act
July 14, 1955, ch. 360, 69 Stat. 322, as amended, which is
classified generally to chapter 85 (§ 7401 et seq.) of Title
2 So
in original.
consults’’.

§ 717b

TITLE 15—COMMERCE AND TRADE

Probably

should

be

‘‘coordinates

and

42, The Public Health and Welfare. For complete classification of this Act to the Code, see Short Title note
set out under section 7401 of Title 42 and Tables.
The Federal Water Pollution Control Act, referred to
in subsec. (d)(3), is act June 30, 1948, ch. 758, as amended
generally by Pub. L. 92–500, § 2, Oct. 18, 1972, 86 Stat. 816,
which is classified generally to chapter 26 (§ 1251 et seq.)
of Title 33, Navigation and Navigable Waters. For complete classification of this Act to the Code, see Short
Title note set out under section 1251 of Title 33 and
Tables.
AMENDMENTS
2005—Pub. L. 109–58, § 311(c)(1), inserted ‘‘; LNG terminals’’ after ‘‘natural gas’’ in section catchline.
Subsecs. (d) to (f). Pub. L. 109–58, § 311(c)(2), added
subsecs. (d) to (f).
1992—Pub. L. 102–486 designated existing provisions as
subsec. (a) and added subsecs. (b) and (c).
TRANSFER OF FUNCTIONS
Enforcement functions of Secretary or other official
in Department of Energy and Commission, Commissioners, or other official in Federal Energy Regulatory
Commission related to compliance with authorizations
for importation of natural gas from Alberta as pre-deliveries of Alaskan gas issued under this section with
respect to pre-construction, construction, and initial
operation of transportation system for Canadian and
Alaskan natural gas transferred to the Federal Inspector, Office of Federal Inspector for Alaska Natural Gas
Transportation System, until first anniversary of date
of initial operation of Alaska Natural Gas Transportation System, see Reorg. Plan No. 1 of 1979, §§ 102(d),
203(a), 44 F.R. 33663, 33666, 93 Stat. 1373, 1376, effective
July 1, 1979, set out under section 719e of this title. Office of Federal Inspector for the Alaska Natural Gas
Transportation System abolished and functions and authority vested in Inspector transferred to Secretary of
Energy by section 3012(b) of Pub. L. 102–486, set out as
an Abolition of Office of Federal Inspector note under
section 719e of this title. Functions and authority vested in Secretary of Energy subsequently transferred to
Federal Coordinator for Alaska Natural Gas Transportation Projects by section 720d(f) of this title.
DELEGATION OF FUNCTIONS
Functions of President respecting certain facilities
constructed and maintained on United States borders
delegated to Secretary of State, see Ex. Ord. No. 11423,
Aug. 16, 1968, 33 F.R. 11741, set out as a note under section 301 of Title 3, The President.
EX. ORD. NO. 10485. PERFORMANCE OF FUNCTIONS RESPECTING ELECTRIC POWER AND NATURAL GAS FACILITIES LOCATED ON UNITED STATES BORDERS
Ex. Ord. No. 10485. Sept. 3, 1953, 18 F.R. 5397, as
amended by Ex. Ord. No. 12038, Feb. 3, 1978, 43 F.R. 4957,
provided:
SECTION 1. (a) The Secretary of Energy is hereby designated and empowered to perform the following-described functions:
(1) To receive all applications for permits for the construction, operation, maintenance, or connection, at
the borders of the United States, of facilities for the
transmission of electric energy between the United
States and a foreign country.
(2) To receive all applications for permits for the construction, operation, maintenance, or connection, at
the borders of the United States, of facilities for the exportation or importation of natural gas to or from a
foreign country.
(3) Upon finding the issuance of the permit to be consistent with the public interest, and, after obtaining
the favorable recommendations of the Secretary of
State and the Secretary of Defense thereon, to issue to
the applicant, as appropriate, a permit for such construction, operation, maintenance, or connection. The
Secretary of Energy shall have the power to attach to

§ 717b–1

TITLE 15—COMMERCE AND TRADE

the issuance of the permit and to the exercise of the
rights granted thereunder such conditions as the public
interest may in its judgment require.
(b) In any case wherein the Secretary of Energy, the
Secretary of State, and the Secretary of Defense cannot agree as to whether or not a permit should be issued, the Secretary of Energy shall submit to the
President for approval or disapproval the application
for a permit with the respective views of the Secretary
of Energy, the Secretary of State and the Secretary of
Defense.
SEC. 2. [Deleted.]
SEC. 3. The Secretary of Energy is authorized to issue
such rules and regulations, and to prescribe such procedures, as it may from time to time deem necessary or
desirable for the exercise of the authority delegated to
it by this order.
SEC. 4. All Presidential Permits heretofore issued
pursuant to Executive Order No. 8202 of July 13, 1939,
and in force at the time of the issuance of this order,
and all permits issued hereunder, shall remain in full
force and effect until modified or revoked by the President or by the Secretary of Energy.
SEC. 5. Executive Order No. 8202 of July 13, 1939, is
hereby revoked.

§ 717b–1. State and local safety considerations
(a) Promulgation of regulations
The Commission shall promulgate regulations
on the National Environmental Policy Act of
1969 (42 U.S.C. 4321 et seq.) pre-filing process
within 60 days after August 8, 2005. An applicant
shall comply with pre-filing process required
under the National Environmental Policy Act of
1969 prior to filing an application with the Commission. The regulations shall require that the
pre-filing process commence at least 6 months
prior to the filing of an application for authorization to construct an LNG terminal and encourage applicants to cooperate with State and
local officials.
(b) State consultation
The Governor of a State in which an LNG terminal is proposed to be located shall designate
the appropriate State agency for the purposes of
consulting with the Commission regarding an
application under section 717b of this title. The
Commission shall consult with such State agency regarding State and local safety considerations prior to issuing an order pursuant to section 717b of this title. For the purposes of this
section, State and local safety considerations
include—
(1) the kind and use of the facility;
(2) the existing and projected population and
demographic characteristics of the location;
(3) the existing and proposed land use near
the location;
(4) the natural and physical aspects of the
location;
(5) the emergency response capabilities near
the facility location; and
(6) the need to encourage remote siting.
(c) Advisory report
The State agency may furnish an advisory report on State and local safety considerations to
the Commission with respect to an application
no later than 30 days after the application was
filed with the Commission. Before issuing an
order authorizing an applicant to site, construct, expand, or operate an LNG terminal, the
Commission shall review and respond specifi-

Page 1016

cally to the issues raised by the State agency
described in subsection (b) of this section in the
advisory report. This subsection shall apply to
any application filed after August 8, 2005. A
State agency has 30 days after August 8, 2005 to
file an advisory report related to any applications pending at the Commission as of August 8,
2005.
(d) Inspections
The State commission of the State in which
an LNG terminal is located may, after the terminal is operational, conduct safety inspections
in conformance with Federal regulations and
guidelines with respect to the LNG terminal
upon written notice to the Commission. The
State commission may notify the Commission of
any alleged safety violations. The Commission
shall transmit information regarding such allegations to the appropriate Federal agency,
which shall take appropriate action and notify
the State commission.
(e) Emergency Response Plan
(1) In any order authorizing an LNG terminal
the Commission shall require the LNG terminal
operator to develop an Emergency Response
Plan. The Emergency Response Plan shall be
prepared in consultation with the United States
Coast Guard and State and local agencies and be
approved by the Commission prior to any final
approval to begin construction. The Plan shall
include a cost-sharing plan.
(2) A cost-sharing plan developed under paragraph (1) shall include a description of any direct cost reimbursements that the applicant
agrees to provide to any State and local agencies with responsibility for security and safety—
(A) at the LNG terminal; and
(B) in proximity to vessels that serve the facility.
(June 21, 1938, ch. 556, § 3A, as added Pub. L.
109–58, title III, § 311(d), Aug. 8, 2005, 119 Stat.
687.)
REFERENCES IN TEXT
The National Environmental Policy Act of 1969, referred to in subsec. (a), is Pub. L. 91–190, Jan. 1, 1970, 83
Stat. 852, as amended, which is classified generally to
chapter 55 (§ 4321 et seq.) of Title 42, The Public Health
and Welfare. For complete classification of this Act to
the Code, see Short Title note set out under section
4321 of Title 42 and Tables.

§ 717c. Rates and charges
(a) Just and reasonable rates and charges
All rates and charges made, demanded, or received by any natural-gas company for or in
connection with the transportation or sale of
natural gas subject to the jurisdiction of the
Commission, and all rules and regulations affecting or pertaining to such rates or charges,
shall be just and reasonable, and any such rate
or charge that is not just and reasonable is declared to be unlawful.
(b) Undue preferences and unreasonable rates
and charges prohibited
No natural-gas company shall, with respect to
any transportation or sale of natural gas subject
to the jurisdiction of the Commission, (1) make
or grant any undue preference or advantage to