The Quoddy Tides

Eastport, Maine

2007 January 26

New partners for LNG project in Calais step forward

by Marie Jones Holmes

After a period of apparent dormancy a liquefied natural gas terminal (LNG) proposal for the Calais area is in the news again with new players.

In August of 2005, former Passamaquoddy Rep. Fred Moore and Rep. H. Ian Emery of Cutler announced the formation of BP Consulting firm and plans for a $500 million LNG facility to be built within the Calais area. Later the name of the company was changed to Calais LNG. At that time the Indian Township government also gave its backing to the project. Since then, Indian Township and Moore have withdrawn from the Calais LNG project. Moore is now involved with the Quoddy Bay LNG project at Pleasant Point. The location of the proposed Calais LNG facility is a 300-acre site in the Red Beach area, located between Devil's Head and St. Croix Island, within the Calais city boundaries.

I am a partner," states Art Gelber, who founded Houston-based Gelber & Associates in 1990, a widely recognized energy and consultant advisory firm, specializing in energy trading practices and related investments. The three partners in the Calais LNG project at this time are Emery, Gelber and Carl Meyers of Pennsylvania. Gelber and Meyers are active in the natural gas industry. Gelber has graduate degrees in geology and has worked with Conoco's international crude oil trading group. Gelber says, "I am working diligently to bring investors in. We are working hard to do what we need to do to bring the project forward."

Gelber comments, "The project was brought to my attention by Representative Emery when he sought my consulting services. As I fulfilled my obligations as a consultant, I learned the merits of this project. I recognized this site as the best site I have seen."

Gelber acknowledges that the other two LNG projects in the area, Quoddy Bay LNG at Pleasant Point and Downeast LNG at Robbinston, are ahead in the game right now. Both companies are in the early stages of the Federal Energy Regulatory Commission (FERC) review process.

"We are sort of the underdog here," says Gelber, who hopes that situation will change. He believes it would be a great loss if the Calais project does not go forward. According to Gelber, Calais LNG will seek intervenor status in the FERC hearings involving the Quoddy Bay LNG project and the Downeast LNG project.

Gelber believes the three proposed projects fulfill many of the same needs but there are some things that make the Calais LNG project superior to the others. The advantages that he sees include the length of the Calais pier, which he says would be shorter than the other two piers, and the shorter distance to the natural gas pipeline connection from the Calais site. He notes that the distance to the pipeline connection is barely over 10 miles from Devil's Head, while the other sites are 30 miles or farther from pipeline access. Gelber says closer pipeline access is less environmentally disturbing and less costly.

A third component, according to Gelber, is the site specific area. Directly across the river is the shipping terminal at Bayside. "It is already an industrial area," comments Gelber. He believes Quoddy Bay LNG will have bridge problems for access to Eastport, and he notes that the Downeast LNG project faces St. Andrews, a recreational and tourism area. Referring to LNG project sites, he says, "They are not the prettiest sight in the world." Gelber believes that a significant advantage to the Calais project is local support.

Gelber is aware of reported Canadian opposition to LNG projects in the area. "They have a right to intervenor status. We do believe we will have the right to use Canadian waters. There is a treaty that allows free passage."

"We are regrouping and moving forward," comments Rep. Emery. He is very positive about the project, and the new partners are planning to visit the area in February and meet with Calais city officials.

Calais City Manager Linda Pagels says, "As it stands, we are generally positive about LNG in the area. It would help our economy and provide new energy sources. We are not favoring one project over another." Calais has filed for intervenor status with FERC for the Downeast and Quoddy Bay LNG projects. According to Pagels, "We are not taking any kind of regulatory route until such time as a project would involve wetlands or pipelines in the Calais area. We will see how things evolve and keep a watchful eye."

"I personally believe there will only be one project permitted," comments Gelber. He also indicated that it is possible that no area projects will be approved.

Opposition continues

Linda Godfrey, coordinator of Save Passamaquoddy Bay, the alliance working to keep the bay free of LNG operations, says, "We thought Ian Emery's Calais project was dead when we learned that three of his partners had withdrawn — Fred Moore, Cianbro Corporation and the Passamaquoddy Tribe at Indian Township. It is especially surprising that Rep. Emery has proceeded alone in this since, when asked last year if LNG was such a great idea why he didn't propose it for his home community of Cutler, he answered that the lobstermen would never allow it. One wonders why Rep. Emery feels the fishermen in Passamaquoddy Bay and Cobscook Bay are less important."

"The LNG industry's own safety standards preclude LNG terminals and LNG ships in Passamaquoddy Bay. Add to that, this Calais proposal suggests placing their operation next to a major international historic site, near a public recreation area, in a narrow tributary of the bay, in waters that are part of the first international historic waterway system, in the transit route of vessels going to New Brunswick's Bayside port and near the eighth busiest border crossing in the U.S.," says Godfrey. "Most of all, Canada has said 'no' to LNG in Passamaquoddy Bay at the local, provincial and national level. With Canada providing such a huge trade market for Calais, it is surprising that Calais leadership feels this project is worth the time, effort and funds that will be expended to even explore this risky proposal. It is also strange that anyone would say they support such a proposal before they had heard a presentation, learned the background of the possible developer and investigated all of the economic, safety and environmental issues that are so clearly raised in the Whole Bay Study commissioned last year by Save Passamaquoddy Bay."


© 2007 The Quoddy Tides
Eastport, Maine
Article republished on Save Passamaquoddy Bay website with permission.