Global demand for liquefied natural gas (LNG) is set to peak in the next few years. Credit: US Department of Energy.

A total of 16 Republican-led states in the US filed a lawsuit on Thursday against the federal government’s ban on approving LNG export applications without any “factual or legal basis”. 

The Republican attorneys general of a coalition of states including Wyoming, South Carolina, Texas, Louisiana and Florida filed the lawsuit in the US District Court for the Western District of Louisiana. It claims that the US Department of Energy’s (DOE) halt on LNG exports will damage the US economy and hinder efforts to reduce its reliance on piped gas from Russia.

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“Instead of supporting clean energy production right here at home, the Biden Administration is hijacking the global energy supply chain to the detriment of Louisiana, our Nation, international stability and developing democracies abroad. That is why we are seeking a preliminary injunction to stop this ban on LNG and protect Louisiana energy,” Louisiana’s Attorney General, Elizabeth Murrill, said in a statement. 

In December, US LNG exports reached the highest monthly and annual levels on record, with analysts predicting that the country could surpass Qatar and Australia to become the top LNG exporter in the world in 2023. The US exported 8.6 million tonnes of LNG in December. 

In late January, the US Government announced a temporary ban on approvals for LNG exports to countries without free trade agreements, enabling the DOE to review the economic and environmental impacts of LNG export projects, as stated by the government. 

However, the recent lawsuit argues that the ban “ignores the clear text of the Natural Gas Act and departs from decades of agency policy”, which mandates the agency to demonstrate that projects are not in the public interest before rejecting applications.

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The states also contest the ban over concerns it puts at risk billions of dollars in planned investments in constructing export facilities. 

The preliminary review is anticipated to take several months.

According to a report by the US Energy Information Agency, the US accounted for almost half of the EU’s and UK’s LNG imports in 2023, making it the region’s largest supplier for the third consecutive year. 

The report showed that the US supplied the largest amount of LNG to Europe compared with any other continent. In 2021, the US provided 2.4 billion cubic feet per day (bcf/d), accounting for 27% of European LNG imports, which increased to 44% (6.5bcf/d) in 2022 and 48% (7.1bcf/d) in 2023.