The Saint Croix Courier

2006 December 29

LETTER TO THE EDITOR

Flawed DELNG newsletter?

Flawed newsletter? In their December 2006 newsletter, Downeast LNG makes several claims regarding the Yellow Wood study that are untrue and misleading.

First, Yellow Wood's study does not "totally reject the idea of an LNG terminal." The purpose of the study is neither to reject nor accept, but rather to provide the people of Passamaquoddy Bay with actual, carefully researched and balanced information regarding the impacts that one or more such installations are likely to have on the area's economy and fiscal condition. We believe important decisions like this that will affect the area profoundly for generations to come ought to be made with as much considered information as possible.

The second claim made by Downeast LNG is the recurring theme regarding employment numbers. The Margaret Chase Smith study, paid for by Downeast LNG, is deeply flawed and based on misleading and unsupportable assumptions regarding the proportion of supplies and employment that will be procured within the State of Maine. For example, in Louisiana, where there is a long history of LNG terminal construction and operation (Louisiana imports 230 billion cubic feet of LNG a year), Tulane-Entergy Energy Institute estimated that 63% of the spending needed to expand eight LNG projects would occur in-state. A study of LNG expansion in Maryland, with greater LNG capacity than Maine but far less than Louisiana, determined that only 3% of materials and labor would be procured in state. The Margaret Chase Smith assumes 72% of spending on LNG construction and operations will occur in Maine.

The State of Maine does not have a single LNG terminal, nor do its contractors have experience constructing or operating such terminals. A detailed analysis of spending and employment impacts, based on realistic assumptions derived from a review of numerous related studies and information specific to the qualifications of Maine contractors, is included in the Yellow Wood report. Based on our analysis, we anticipate approximately 27 local jobs will be created during construction, and approximately 8 jobs during operations and 12 additional jobs for tugboat operators.

As we have explained previously with respect to the numbers in the Yellow Wood study pertaining to tugboat crews, if one is interested in facts and not inflammatory rumor, one would find that the page from which a portion of our information was derived pertains directly to tugboats, not scuba diving. According to an article appearing in the Boothbay Register on June 10, 2004, the James R. Moran, a new Z-drive tugboat built by Washburn & Doughty, "frequently operates with a crew of three, comprising a captain, deckhand and engineer, assisting as many as 90 of the world's largest LNG tankers at [Dominion Natural Gas LNG terminal]."

The fact that harbor tugs often operate with three crew members was also corroborated by a Moran Towing Representative from Portsmouth,N.H.

No one to date has conducted a study that shows the number of jobs that will be lost due to the presence of one or more LNG terminals in Passamaquoddy Bay. Jobs in tourism, research, manufacturing, fisheries, second home sales, construction and maintenance are among those in jeopardy. Until such a study is completed, it is not possible to calculate the net cost or benefit in terms of employment. However, Yellow Wood conducted a study in Harpswell, Me., in 2004 that looked closely at both job creation and job destruction. That study revealed the strong likelihood of a net loss in employment due to LNG. The people of Harpswell voted against an LNG terminal for this among other reasons. We strongly urge the State of Maine to fund a study that would determine the net employment impacts of one or more LNG terminals in Passamaquoddy Bay so the people of the Bay can have the information they need to make whatever choice they determine will be in their best interests.

Shanna Ratner, Principal
Yellow Wood Associates, Inc.