Legal setback for US LNG arena: Court nixes $11 billion Gulf Coast project’s permit

October 20, 2025, by Melisa Cavcic

A wave of planned U.S. liquefied natural gas (LNG) projects is perceived to be under scrutiny in the aftermath of a recent court ruling, which revoked a permit for an LNG export terminal over alleged climate harms. This decision is anticipated to halt the project’s construction activities on the west bank of the Calcasieu Ship Channel at the mouth of the Gulf of America (Gulf of Mexico) near Cameron Parish in Louisiana, United States.

Rendering of Commonwealth LNG; Source: Commonwealth LNG

Based on the court’s findings, the Louisiana Department of Energy and Natural Resources (LDENR) violated the Louisiana Constitution by issuing the coastal use permit for the proposed Commonwealth LNG export facility without considering its disproportionate effect on the surrounding communities of color and low-income communities, alongside the climate change and cumulative impacts, with other export facilities in the area.

Eric Huber, Managing Attorney at Sierra Club, commented: “We are heartened by the court’s ruling that LDENR’s refusal to consider the environmental justice impacts of the project violated the Louisiana Constitution. It is past time for LDENR to account for the true costs of its permits on Louisiana’s coastline and communities in terms of loss of wetlands and storm buffers.

“This is another in a series of permits by LDNR for the LNG build-out on the Gulf, including the permit for CP2 directly across Calcasieu Pass. We urge LDENR to stop its pro-forma permitting and carry out its mission to protect the public health and welfare of all Louisianans.”

With this in mind, a Louisiana state court vacated the coastal use permit for the proposed export project, highlighting that state officials failed to consider the environmental implications of the development. Commonwealth LNG, which is controlled by the energy-focused alternative investment manager Kimmeridge, has secured multiple LNG offtake deals, including the most recent one with EQT.

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James Hiatt, Director of For a Better Bayou, said: “This ruling is a victory for the people and the wetlands of Southwest Louisiana. It shows that when our government fails to protect our coast from reckless industrial expansion, the courts can still uphold the law.

“For too long, communities like ours have carried the burden of pollution, flooding, and destruction while corporations profit. This decision is a reminder that our coast is not a sacrifice zone—it’s our home, and it deserves protection.”

Climate change campaigners believe that Commonwealth LNG would permanently destroy over 75 acres of wetlands in the Calcesieu Pass area, and alter hundreds more, adding to the already permanent alteration of over 500 acres of wetlands approved for just two of the neighboring coastal LNG projects.

Joanie Steinhaus, Ocean Program Director for Turtle Island Restoration Network, emphasized: “This is an area of the Louisiana coastline that is being devastated by LNG facilities. These agencies have long ignored the cumulative impact to air and water quality and the health of the local community members and the environment.”

This is not Commonwealth LNG’s first brush with the law, as a three judge panel of the U.S. Court of Appeals for the D.C. Circuit rejected the Federal Energy Regulatory Commission (FERC) authorization for the same project in July 2024, ruling that FERC failed to adequately assess the cumulative and direct environmental and health impacts that would be caused by air pollution from the facility.

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The decision caused FERC to revise its air pollution analysis and give the project the go-ahead to begin site preparation for construction. However, the Cameron Parish court’s decision has now revoked the state coastal use permit, which is anticipated to stop the project’s construction unless and until a new permit is issued in compliance with the Louisiana Constitution.

Anne Rolfes, Director of Louisiana Bucket Brigade, underlined: “Like the rest of the gas export industry, Commonwealth would be a polluting disaster that would destroy fragile fishing areas and further decimate fishing families in southwest Louisiana. It should never have been permitted. We hope this ruling shakes Louisiana to its senses.

“On one side are out of state profiteers who export our natural resources and pollute us in the process. On the other are Louisiana families who want to be able to live here and catch and eat our seafood. Commonwealth would destroy our coast and our culture. It would make us more vulnerable to storms. The coastal use permit needs to be revoked.”

Sierra Club claims that the liquefied methane gas, known as LNG, which the project would export, would have annual greenhouse gas emissions equivalent to 14 coal-fired power plants or 13 million new gasoline-powered vehicles.

With six LNG export terminals proposed, approved, under construction, or operating in the area, including Venture Global’s Calcesieu Pass and CP2 facilities, energy analysts believe that there is a risk the latest court ruling could impact other LNG development and expansion projects.

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According to Sierra Club, these facilities contribute to the loss of hundreds of acres of wetland and habitat for sensitive species, increased flooding, loss of buffer areas from storms, air and water pollution, and increased risks of catastrophic industrial accidents.

John Allaire, Resident of Cameron Parish, stated: “As a long-term landowner in Cameron Parish who lives adjacent to the Commonwealth LNG site and one mile from Venture Global’s Calcasieu Pass LNG, I see the effects of LNG export terminals every day— the frequent flaring, the noise and light pollution, and destruction of our wetlands and fisheries. It’s a massive burden and destroying our community.

“I am relieved that the Judge upheld our concerns with Commonwealth LNG, and that LDENR failed the people of Cameron Parish. My hat is off to the local district court for this unbiased decision to hopefully protect the citizens and save a piece of God’s country in Cameron Parish.”