Posted on April 15, 2024
U.S. Senate Commerce Committee Ranking Member Ted Cruz (R-Texas) is celebrating a major victory for Texas’s energy industry today after the Department of Transportation’s Maritime Administration (MARAD) granted a license to construct a deepwater port to Houston’s Enterprise Products’ Sea Port Oil Terminal (SPOT). This announcement follows Sen. Cruz’s probe into MARAD’s lengthy delays in reaching decisions on applications for deepwater ports exporting oil and natural gas.
Last year, Sen. Cruz requested MARAD give the Commerce Committee a timeline for issuing all pending deepwater port licenses and demanded quarterly updates regarding all pending license applications to ensure that the agency is working diligently on them. For years, the Biden administration has delayed licenses for projects to construct deepwater ports. In his letter, Sen. Cruz argued MARAD had gone more than three years on average without issuing a deepwater port licensing decision — almost three times as long as is statutorily permitted.
Following the announcement from MARAD, Sen. Cruz said:
“After tireless work by my office and many others to secure this deepwater port license, I’m thrilled that we’re helping bring more jobs to Texas and greater energy security to America and our allies. That this victory was delayed by years of needless bureaucratic dithering shows why we need broader permitting reform in this country. I intend to continue to lead on policies that make it easier to build and invest in Texas.”
The new oil export facility, which was one of seven pending applications for licenses, is located offshore of Brazoria Country in the Gulf of Mexico. This facility will have the capability to export two million barrels per day, a substantial boon to Texas’s energy industry.
Background:
Sen. Cruz successfully fought to include language in last year’s National Defense Authorization Act that would increase transparency and expedite deepwater ports licenses by MARAD.
In February 2023, Sen. Cruz sent a letter to MARAD seeking information about its lengthy delays in reaching decisions on applications for deepwater ports exporting oil and natural gas. The letter also urged MARAD to meet its statutory deadlines to make decisions. At the time, four of the seven pending applications for licenses were for projects located off the coast of Texas.
Congress established a legal timeline of 356 days for an approval or denial of such licenses. To skirt this 356-day timeline, MARAD has asked applicants for additional information, often paused the clock, and has not resumed it in many situations. As a result, the average project approval time has ballooned to approximately 1,000 days, which is close to triple the mandatory time limit.
There can be additional delays to the granting of licenses, such as completing an “Environmental Justice engagement plan” or other burdens under the National Environmental Policy Act (NEPA). For example, the SPOT project was delayed by several months after MARAD asked the applicant to re-publish for public comment a draft Environmental Impact Statement in Vietnamese. The uncertainty over whether and when MARAD will approve these plans (or move the goalposts) makes planning and investment difficult for applicants, thus reducing job growth and hurting allies seeking to import U.S. energy.
According to MARAD, delayed applications for deepwater ports date back as far as May of 2019, meaning projects that would allow the processing of substantial amounts of oil and gas every single day and help provide good-paying jobs for hard-working energy workers and exports to America’s allies have remained stalled arbitrarily.
