The U.S. Department of Energy (DOE) has announced an order that removes significant barriers for the use of liquefied natural gas (LNG) as a marine fuel to power vessels. This development aims to streamline regulations surrounding LNG bunkering and facilitate the growing use of LNG in maritime operations, supporting both sustainability and efficiency in the industry.
In the recent announcement, the DOE modified a previous order granted to JAX LNG under the prior administration, which imposed new oversight for LNG use as a marine fuel. The new order is seen as a critical step in reducing regulatory burdens and encouraging the expansion of LNG as an alternative fuel for vessels, which is a growing trend in response to stricter emissions regulations for the shipping industry.
Tala Goudarzi, Principal Deputy Assistant Secretary of the Office of Fossil Energy and Carbon Management, commented on the order, stating, “Today’s action is a significant step in reducing regulatory burdens and helping this important segment of the LNG market continue to grow.”
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JAX LNG’s Role in LNG Bunkering Operations
JAX LNG is a small-scale coastal LNG facility located at Dames Point, near Jacksonville, Florida, that provides LNG as a fuel source for various marine vessels, including cruise ships, car carriers, petroleum tankers, and container ships. This move by the DOE allows JAX LNG to continue its operations with reduced regulatory oversight, further solidifying its role in advancing LNG bunkering services.
The DOE’s Order on Rehearing, issued to JAX LNG, modifies a previous order from December 2024. The modification clarifies that the DOE will no longer exercise jurisdiction under the Natural Gas Act (NGA) for ship-to-ship LNG transfers for marine fuel use within U.S. ports, U.S. waters, or international waters. However, the DOE will continue to consider ship-to-ship transfers of U.S. LNG as exports when the receiving ship is located in a foreign country’s territorial sea or port. Additionally, DOE’s authorization for JAX LNG to export LNG via ISO containers remains unchanged.
Growing Demand for LNG as Marine Fuel
The increasing adoption of LNG as a marine fuel aligns with the rising demand for cleaner, more sustainable alternatives to traditional marine fuels. As emissions regulations in the shipping industry become stricter, LNG has emerged as a viable solution, offering lower emissions compared to conventional marine fuels. According to the International Energy Agency’s (IEA) January 2025 Quarterly Gas Report, the number of LNG-powered vessels is expected to nearly double by 2028, with over 1,200 vessels projected to be operating with LNG as their fuel source.
This shift toward LNG as a marine fuel reflects the growing importance of reducing the environmental impact of the maritime sector and accelerating its decarbonization efforts.
About the U.S. Department of Energy (DOE)
The U.S. Department of Energy (DOE) is a federal agency tasked with advancing the country’s energy policies and promoting innovations in energy production, storage, and utilization. The DOE plays a key role in supporting the development and deployment of cleaner energy technologies, such as liquefied natural gas (LNG), to enhance the sustainability and efficiency of various industries, including the maritime sector. The DOE is committed to ensuring U.S. energy security, promoting environmental sustainability, and accelerating the transition to a clean energy future through policies, regulations, and strategic partnerships.
Source U.S. Department of Energy