Cheniere Energy, the top U.S. exporter of liquefied natural gas, is seeking an estimated more than $140 million in federal tax credits for fueling its LNG tankers with the very gas they’re built to carry—raising eyebrows among tax and environmental experts, Inside Climate News writes.
The company is pursuing the alternative fuel excise tax credit, originally intended to encourage cleaner alternatives to gasoline and diesel. Critics argue that using LNG boil-off gas for propulsion isn’t an “alternative”—it’s standard practice to avoid waste and prevent safety risks.
Still, the IRS is reviewing the claim, and a favorable decision could open the door to similar filings industry-wide. Cheniere hasn’t booked the credits yet but maintains it is eligible.
If the IRS approves Cheniere’s claim, the company would be eligible for a 50-cent tax credit for each diesel gallon equivalent of fuel used. Cheniere declined to reveal the size of the tax credit it is claiming. However, according to calculations by Inside Climate News, it could exceed $140 million.
