Regulatory Relief for LNG: FERC Proposes Blanket Authorization Procedures for Facility Modifications

On Oct. 15, 2026, the Federal Energy Regulatory Commission (FERC) approved a Notice of Proposed Rulemaking (NOPR) that would establish blanket authorization procedures for certain modifications to liquefied natural gas (LNG) facilities.[1] The proposed program — the first of its kind for LNG facilities — is modeled on FERC’s existing blanket authorization program for natural gas pipelines subject to its jurisdiction under the Natural Gas Act (NGA). If adopted, the proposal would give LNG facility owners a degree of regulatory relief by creating a streamlined and expedited process for undertaking certain routine and low-impact projects.

Comments to FERC on the NOPR are due Dec. 21, 2026.

Additional FERC Action on NEPA Reviews: Readers may also be interested in FERC’s draft policy statement (also issued on Oct. 15, 2026) addressing how the Commission will review natural gas pipeline and LNG facility air emissions under the National Environmental Policy Act (NEPA) and the NGA (Draft Policy Statement). Comments on the draft policy statement are due Nov. 16, 2026.

Background

FERC regulates the siting, construction, expansion and operation of LNG facilities under sections 3 and 7 of the NGA. Section 3 covers the siting, construction, expansion and operation of LNG import and export facilities, while section 7 governs the construction, extension, acquisition and operation of gas pipeline and storage facilities in interstate commerce. Currently, an LNG operator seeking to modify its facility must follow the same application process (including mandatory pre-filing) that applies to the construction of new LNG export or import terminals — a cumbersome process that can take years.

By contrast, the Commission has for decades maintained a blanket authorization program that allows interstate pipeline and storage operators to undertake certain smaller projects that meet eligibility requirements and cost thresholds without the need to obtain a case-specific order from FERC approving such activity.

This rulemaking began on Nov. 20, 2025, when the Commission issued a Notice of Inquiry (NOI) seeking comment on whether — and if so, how — to authorize activities at LNG facilities without case-specific authorization.

Proposed Rule

Drawing on the NOI comments, the Commission now proposes a three-tiered blanket program for LNG plants that sets eligibility criteria for certain lower-impact projects, which would be either automatically authorized or subject to a prior notice process. The proposed blanket LNG program is akin to its existing two-tiered program for interstate gas facilities, with one notable difference: FERC does not propose to adopt the cost thresholds that apply under the pipeline blanket program.

Under the proposed regulations, limited activities at existing LNG facilities would be provided automatic authorization and could therefore be constructed and operated without the facility owner obtaining prior approval from, or providing prior notice to, FERC. Activities at LNG facilities that do not qualify for automatic authorization may still qualify under a prior notice process. Under that process, the operator must file a notice containing specified information with FERC at least 60 or 90 days before the proposed start of activities. If no protest is filed (or if a protest is withdrawn or dismissed before Commission action), the project is deemed authorized, and the operator may proceed. If a protest is filed and not withdrawn or dismissed, the project would be reviewed as a case-specific application requiring a FERC order.

Tier I: Automatic Authorization

To be eligible for automatic authorization, a proposed modification must:

1. not result in an expansion or increase of the authorized capacity of the LNG plant;
2. occur within the existing horizontal and vertical extents of the plant’s footprint and design limits;
3. not result in adverse safety or reliability impacts at the plant; and
4. have only minor or no environmental effects.

The NOPR identifies specific activities that would be eligible for automatic authorization.[2]

Tier II: 60-Day Prior Notice

The 60-day prior notice process would be available for specific activities that would:

1. increase the authorized capacity of the LNG plant;
2. be located within the footprint of the LNG plant;
3. not result in any change in flows, levels, volumes, pressures, temperatures, compositions, or loads outside the design limits of the new, replaced, and modified LNG facilities, auxiliary systems, and components; and
4. not result in any such changes outside the authorized design limits of the remaining LNG facilities, auxiliary systems and components.

Activities that would be eligible for the 60-day prior notice procedures are identified in the NOPR.[3]

Tier III: 90-Day Prior Notice

The 90-day prior notice process would apply to the “[c]onstruction of new LNG facilities, such as liquefaction trains, LNG tanks, and marine berths, and auxiliary systems outside of the footprint of the plant.”[4] These projects would also be subject to the following limitations and conditions:

1. any expansion of facilities must be either within the existing LNG plant footprint or adjacent to the LNG plant, permanently occupy no more than 25 acres, occupy only previously disturbed or developed land or waterways, and be within industrially zoned areas or areas without zoning;
2. requests must demonstrate that any modifications outside the existing footprint will comply with all environmental and engineering conditions of the plant’s authorization; and
3. the facilities must be of the same type (in-kind or upgraded) as those previously authorized by the Commission at the same LNG plant or terminal or reviewed and approved by Commission staff for the underlying authorization. 

Activities that would be eligible for the 90-day prior notice procedures are identified in the NOPR.[5]

Waiver of Pre-filing Requirement

Consistent with its goal of streamlining the authorization process, the Commission proposes to waive its pre-filing regulations for LNG blanket activities.

Requests for Blanket Authorization

As under its pipeline blanket certificate program, FERC proposes to require prospective LNG authorization and certificate holders — including operators of existing LNG facilities — to obtain blanket authorization before using the LNG blanket program.[6] To avoid acting on each request itself, the Commission would delegate authority to act on these requests to the Director of the Office of Energy Projects (OEP). The Commission noted, however, that it would retain authority to rescind, or decline to grant, a blanket authorization for non-compliance.

In addition, for any entity that obtains LNG blanket authorization for an NGA section 7 facility, FERC proposes to end the eligibility of section 7 LNG facilities (including auxiliary systems) under 18 C.F.R. § 2.55,[7] subject to a limited sunset period for projects already slated to proceed under § 2.55. The Commission reasoned that activities eligible under § 2.55 would be redundant to those eligible for automatic authorization under the LNG blanket program.

Stakeholder Notification

The NOPR proposes to require operators to provide notice of projects to be constructed pursuant to the blanket authorization to each affected landowner and to the locality (i.e., the city, town, or similar local political subdivision) in which the LNG terminal or plant is located, subject to limited exclusions.

Compliance with NEPA and Other Federal Statutes

With respect to its obligations under the National Environmental Policy Act (NEPA), FERC proposes that prior notice activities undergo project-specific review in the form of either (i) a determination that a categorical exclusion applies or (ii) an environmental assessment, as under the pipeline blanket program. At least for now, FERC does not propose any new categorical exclusions for work performed under the LNG blanket program.

Blanket activities that involve ground disturbance or increases in operational air emissions, operational noise or public safety risks must comply with all applicable law, and the NOPR specifically addresses several relevant statutes.

PHMSA, USCG and DoW Coordination

The Commission explains that a Letter of Determination (LOD) from the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) — which sets safety standards for FERC-approved LNG facilities — would not be required for automatic authorization activities. For prior notice activities, however, FERC proposes to require blanket authorization holders to obtain from PHMSA and include in their request an LOD stating that the activities comply with federal siting requirements or a letter stating that an LOD is not required.

Likewise, a new or updated Letter of Recommendation (LOR) from the U.S. Coast Guard (USCG) would not be required for automatic authorization activities. For prior notice activities, the NOPR proposes to require blanket authorization holders to obtain from the USCG and include in their request a new or updated LOR or a determination that a new or updated Letter of Intent, Waterway Suitability Assessment or LOR is not required.

To satisfy NGA section 3(f), which requires the Commission to obtain the Secretary of War’s concurrence before authorizing a section 3 LNG project affecting the training or activities of an active military installation, FERC proposes to require blanket authorization holders to obtain Department of War (DoW) concurrence through DoW’s Military Aviation and Installation Assurance Siting Clearinghouse process for automatic authorization and prior notice activities.

State and Local Safety Considerations

Due to the limited nature of automatic authorization activities, FERC reasoned that they would not raise state or local safety considerations beyond those addressed in the underlying authorization. For prior notice activities, however, blanket authorization holders would need to include in their filing a letter from the state-designated agency indicating that the activity raises no state or local safety concerns.

Standard Environmental and Engineering Conditions

Blanket authorization holders would be required to comply with a standard set of environmental and engineering conditionsfor automatic and prior notice activities. The proposed environmental conditions would require, among other things, (i) compliance with all applicable laws including identified federal environmental statutes; (ii) that blanket activities not have a significant adverse effect on a sensitive environmental area, as defined in § 157.202(b)(11) of the pipeline blanket regulations; and (iii) compliance with certain noise criteria. The conditions would subject LNG blanket activities to (i) standard engineering requirements, as well as regular technical reviews and site inspections by FERC staff; (ii) semi-annual reporting; and (iii) reporting of significant nonscheduled events.

Notice to Proceed

Blanket authorization holders would not need to obtain a notice to proceed from OEP for automatic authorization activities. For prior notice activities, however, FERC proposes to require (i) a notice to proceed with commissioning or the introduction of hazardous fluids, to ensure that all necessary safety and security systems are installed and functional, and (ii) a notice to commence service.

Emergency Response Plans

Under the proposed regulations, automatic authorization activities would not require material updates to the emergency response and cost-sharing plans approved in the facility’s underlying authorization proceeding. For prior notice activities, however, blanket authorization holders would need to obtain from all relevant state and local emergency response organizations and responders, and include in their request, letters stating either that the activities are consistent with the Emergency Response Plan (including the cost-sharing plan) for the underlying authorization or that any changes were developed in consultation with them. If such letters cannot be obtained, holders must instead show in their filings that those organizations and responders have been notified.

In-Service Deadline

Projects under the LNG blanket program must be constructed and placed in service within five years of the date when the activity is deemed authorized.

Rate Treatment of Blanket Activities

The Commission proposes different rate treatment for automatic and prior notice projects. For NGA section 7 LNG related activities completed under automatic authorization, FERC proposes that costs be presumptively eligible for rolled-in rate treatment because the eligible activities will enhance reliability and safety. While this presumption does not guarantee rolled-in treatment, it creates a significant hurdle for any party seeking to challenge it later.

For activities completed under the prior notice category, the Commission notes that it has separately proposed changes to its section 7 pipeline blanket program to allow for incremental rates and that any changes adopted in that proceeding would also apply to section 7 LNG blanket activities.[8]

McGuireWoods is available to assist with questions about the NOPR or FERC natural gas regulation generally. For more information, contact the authors or a member of the firm’s Federal Energy Regulatory Commission team.

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[1] The NOPR is available at https://www.federalregister.gov/documents/2026/10/20/2026-21443/authorizations-for-certain-activities-at-liquefied-natural-gas-plants. 

[2] NOPR at P 43.

[3] NOPR at P 54.

[4] NOPR at P 22.

[5] NOPR at P 56.

[6] FERC noted that, as under its pipeline blanket certificate program, a new LNG applicant could request blanket authorization concurrently with its request for authorization under NGA section 3 or 7.

[7] Section 2.55 provides a limited exemption from the prior authorization requirement for section 7 LNG facilities to construct certain auxiliary facilities or replace existing facilities.

[8] See Revisions to the Blanket Certificate Program, 91 FR 31371 (May 27, 2026), 195 FERC ¶ 61,128 (2026).