NEW ORLEANS – The 38th Judicial District Court has nullified a coastal permit for Commonwealth LNG, a multibillion-dollar export terminal in Cameron Parish, effectively halting construction and marking the first time in Louisiana that a state permit has been struck down for failing to account for climate change and environmental justice impacts.
Judge Penelope Richard ruled that the Louisiana Department of Conservation and Energy was required under existing law to conduct a broader analysis of climate and community impacts before issuing the coastal use permit. Because the agency did not do so, she vacated the permit.
Under both state law and the ruling, regulators must evaluate how the project and the region’s broader LNG buildout could affect coastal ecosystems, storm severity, sea-level rise, and the livelihoods of nearby low-income fishing communities.
Several key issues are at the center of the case, including whether state regulators may rely on federal environmental analyses when issuing coastal permits, whether the effects of climate change fall within the state’s regulatory scope, and whether regulators must demonstrate that a project’s benefits outweigh its potential costs to surrounding communities.
Federal vs. State Reviews
Louisiana’s coastal management law requires regulators to evaluate the direct and cumulative impacts of projects in the coastal zone, including effects on wetlands, waterways, and other natural resources, before granting a permit. The law does not mandate a full environmental impact statement (EIS) like those conducted at the federal level, but it obligates the state to make its own determination that a project complies with Louisiana’s coastal policies.
In permitting Commonwealth LNG, the Department of Conservation and Energy relied on a federal EIS prepared by the Federal Energy Regulatory Commission (FERC) rather than conducting its own analysis of climate and environmental justice impacts. Judge Richard found this reliance insufficient, concluding that state law requires Louisiana regulators to independently assess local and cumulative effects before issuing a coastal use permit.
Former agency director Tyler Gray defended the department’s approach, arguing that the court misinterpreted state law by requiring a separate state-level review beyond the federal analysis.
Climate Change
Judge Richard also rejected the department’s position that climate change lies outside its regulatory scope, finding that state law requires regulators to consider the cumulative impacts of LNG development, including potential harm to wetlands, water quality, and nearby residents, before approving a coastal use permit.
Balancing Benefits and Costs
The court further directed regulators to demonstrate, as required by Louisiana’s coastal management law, that the public benefits of projects like Commonwealth LNG clearly outweigh their potential environmental and social costs. Judge Richard found that the department had not made this determination, leaving regulators to revisit whether the project’s benefits justify its potential harm before any new permit can be issued.
Legal and Regulatory Developments
The case was brought by the Louisiana Bucket Brigade, the Sierra Club, and the Turtle Island Restoration Network. Commonwealth LNG, a Houston-based company, said it is exploring legal options, while the state’s energy agency has declined to comment on ongoing litigation.
The decision follows a 2024 federal appeals court order directing the Federal Energy Regulatory Commission (FERC) to reexamine Commonwealth’s greenhouse gas emissions. Although FERC later concluded that the project serves the public interest, Judge Richard’s ruling voided the state-level permit required for construction. Earlier this year, FERC granted Commonwealth LNG a four-year extension, allowing construction to continue through 2031.
The ruling also comes amid renewed federal support for LNG under President Donald Trump, whose administration reversed a Biden-era pause on new export approvals and expedited Commonwealth LNG’s federal permit shortly after taking office. Energy Secretary Chris Wright, a former fossil fuel executive, has worked to fast-track LNG projects as part of the administration’s “energy dominance” agenda.
Louisiana’s Expanding LNG Footprint
Louisiana produces more than 60% of U.S. LNG exports and is home to 13 existing, approved, or proposed terminals with three in Cameron Parish alone. Environmental groups and local fishermen warn that the rapid industrial expansion, including dredging for shipping channels, is damaging coastal habitats and the fishing economy.
In one recent incident, a Venture Global dredging project leaked into a nearby estuary, which residents say harmed oyster, crab, and fish populations. Venture Global said it is cooperating with regulators and community members to address the spill.
A recent Environmental Integrity Project report, Terminal Trouble: Pollution Violations at America’s LNG Export Terminals, found that all operating LNG terminals nationwide violated air pollution standards, identifying several Louisiana sites among the most polluting. Industry leaders disputed the findings, calling them misleading and emphasizing that U.S. LNG remains one of the most heavily regulated energy sectors, providing jobs, export revenues, and what they describe as cleaner-burning fuel for global markets.
