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"For much of the state of Maine, the environment is the economy"
                                           — US Senator Susan Collins, 2012 Jun 21

Atlantic Coast LNG 2004
Conference Report

29 July 2004

Submitted by Cliff Goudey

The following piece was posted by Cliff Goudey on the FFFH forum http://www.fffh.org/forum/viewtopic.php?id=111. It was in response to the coverage of the 29 July LNG conference by the Time Record and the Portland Press Herald, where a silly protest act was portrayed as the most newsworthy outcome of the event.

FYI, What really happened at the LNG conference

Webmaster’s notes:
  • "CFL" in this report refers to "Conservation Law Foundation";
  • "CP/TCP" refers to "ConocoPhillips and TransCanada Pipeline."

While the list of speakers at last Thursday's LNG Conference found at http://www.CLF.org/bepart/events.htm#LNG [link has expired; current URL as of October 2004 is... http://www.CLF.org/uploadedfiles/CLF/Programs/Clean_Energy_&_Climate_Change/Climate_Protection/Regional_LNG_Strategy/LNG Conf Agenda.pdf — Webmaster] suggests a pro-LNG bias, and the list of questions from that same agenda displayed a measure of naivety on the topic of LNG, I thought the event was interesting and well run. The moderator, Richard Barringer from the Muskie School of Public Service at USM, mentioned that locating large industrial facilities on coastal Maine has provoked debate for over 30 years. He also specifically mentioned the difficult process Harpswell had endured over recent months.

Industry's interests in placing an LNG terminal in Maine were presented nicely by Ms. Foss of the University of Houston but she offered little new insight to anyone who has done any homework on the topic of LNG.

The presentation by Bryngelson on the "Energy Bridge" offshore terminal http://www.excelerateenergy.com/ now proposed off Marblehead, MA, was impressive. He reports their first project off Louisiana is slated to begin operation in early 2005. He explained less cost, reduced public risk, and aesthetic considerations were the reasons for the rapid approval and completion of their novel approach to importing LNG.

Then Matt Simmons, a natural gas investor, explained how the northeast go into its energy bind by "betting the ranch" on natural gas. It seems 90% of all new generating capacity has come from gas while domestic and easily imported supplies from Canada diminished. He sees a crunch coming. However, he is not supportive of placing LNG terminals on the coast of Maine. He sees offshore terminals as feasible but would prefer to see an increased exploitation of domestic sources by opening up areas on the outer continental shelf - Georges Bank in particular.

Beth Nagusky, Director, Maine Energy Office, portrayed the Governor's position on LNG as simply seeking fuel diversity for Maine's citizens. Though 80% of the gas used in Maine is domestic or Canadian, the limited capacity of the gas grid can leave New England exposed. She portrayed LNG as a bridge to the development of renewable sources. A competing theory is that an increased natural gas supply would stifle such developments.

Then Laurie Lachance, an economist for the State of Maine, presented the case for LNG based on secondary jobs. What she presented was the data that related to the Fairwinds venture where the 50 permanent jobs resulted in over 1,200 new permanent positions. When asked, she admitted that the data came from CP/TCP and that they did very little analysis.

After lunch, Seth Kaplan from CLF explained their position on LNG. They see conservation as the most realistic approach to solving the natural gas supply/demand problem. He also explained how LNG imports will not reduce emissions from their current levels and how a proper debate is needed before the need for LNG can be confirmed.

Dr. Raj's presentation on LNG pool fire tests was very authoritative. He explained the basis for the unreliability of small test fires in predicting catastrophic events. He had video from France of the largest such tests (several truck loads of LNG in a 100' diameter pool) that was sobering. He also had videos of an un-ignited plume from such test spills moving downwind, clinging tight to the ground, as the cold methane is heavier than the surrounding air. I found his honesty on this important point very refreshing.

A representative from the Coast Guard spoke of their role in security. While they lead the permitting process for offshore terminals, they have no decision-making role in the FERC-lead permitting of land-based LNG terminals.

Robin Alden, former DMR commissioner, then explained the potential problems in trying to mix LNG terminals with the existing uses of coastal Maine. She presented statistics on the lobster industry ($280m/year, over 20,000 jobs) and questioned why that should be put at risk for an industry that does not fit the small business entrepreneurial model that works so well.

John Duff, Director of the Marine Law Institute, then explained the regulatory process LNG terminals must negotiate. He sees ample opportunity for public input explaining that the national Environmental Policy Act (NEPA) is the most useful to opposing forces and can often be used to delay an inappropriate project until the economic arguments for a project fade away.

John Moskal from the EPA explained that agency's limited role in LNG permitting. He was followed by Robert Cupina from FERC, who indicated that a ruling by the FERC in 2002 (the Hackberry decision) has been important in stimulating the current interest in LNG terminals as it allows "a more flexible business model." Visit http://www.eia.doe.gov/oiaf/aeo/leg_reg7.html to learn more about how this action by FERC has spawned a flood of LNG import ventures on every coast. When asked, Moskal confirmed that the FERC has never denied an application for an LNG terminal.

The questions at the end of each of the four sessions and at the end of the day were probing and revealed a relatively sophisticated audience. There were several representatives from the Passamaquoddy tribe and from the Canadian Islands that would be affected by the Quoddy Bay LLC proposal. They expressed concern about the impacts of such a project and over what protection the agencies might offer given the tribal situation and how national boundaries might limit their voice. The FERC reported they have heard nothing from the project proponents.

We were told that videotapes of the entire proceedings can be obtained from CLF. If you are interested, I suggest you call Melanie Chicoria at 207-729-7733.


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