Deepwater Port Act Amended to Allow Oil and Gas Exports from Offshore Facilities


On December 20, 2012, President Obama signed into law the Coast Guard and Maritime Transportation Act of 2012. The bill (HR 2838) included language amending the Deepwater Port Act (DWPA) (33 U.S.C. 1501 et seq.) to allow export shipments of oil and gas to occur from offshore facilities in U.S. waters.

Initially passed in 1974, the DWPA authorizes the ownership, construction and operation of marine terminals in federal waters on the Outer Continental Shelf (OCS). The DWPA originally applied only to oil import terminals, and in 2002, was amended to include liquefied natural gas (LNG) import terminals. The recent amendment in Section 312 of the Coast Guard and Maritime Transportation Act of 2012 expands the definition of deepwater ports to include facilities for exporting both oil and natural gas.   

DWPA license applications are jointly reviewed by the Coast Guard and U.S. Department of Transportation (DOT), Maritime Administration, with DOT having ultimate licensing authority. License applications are reviewed under an expedited, 356-day state and federal review process. 

To date, one oil deepwater port, the Louisiana Offshore Oil Port (LOOP), has been permitted and constructed in the United States. Eight offshore LNG terminals have been approved by DOT and three have been constructed, including two floating terminals that are currently in operation offshore of Massachusetts.

This amendment to the DWPA opens up new opportunities to use both fixed and floating offshore facilities on the OCS for loading and export of oil and natural gas. In particular, the potential to use floating facilities, which can be redeployed to other regions based on need, can provide long-term flexibility in response to changing market conditions.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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