"For much of the state of Maine, the environment is the economy"
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30 Month 2009
Grassroots Groups Protest Man Made LNG Island off NJ/NY
Tuesday, January 27th, and Thursday, January 29th, saw public hearings in New Jersey and New York, held by the Coast Guard and US Maritime Administration, the neutral party to ultimately grant or deny permission.
Once the proceedings started, one speaker asked how many people in the room were for the projects. The four folks representing the investors raised their hands. The other near 500 surfers, environmentalist, divers, fishermen, and concerned citizen in attendance were against it. Thursday's outcome was similar, as 400 protestors packed a smaller venue.
Webmaster's Comments: This article contains photographs of some interesting "No LNG" cookies.
A recurring theme over the first week of the session has been the growing concern over weakening natural gas markets in the Lower 48, as a recession crimps demand for fuel after a year of increasing production and the future promising more unconventional gas.
On the back of that emerging dynamic, the Alaska Gasline Port Authority testified before a Senate committee about liquefying North Slope natural gas and shipping it overseas. [Red & bold emphasis added.]
“Few industry analysts have supported our forecast,” admits Johnson. “Yet, we anticipated an unprecedented increase in global supply and a dramatic drop in demand for LNG throughout the world, especially in Asia. So, we knew surpluses would result.” [Red emphasis added.]
This is one of the major conclusions of a new report by consultancy firm Gas Strategies, which says 2009 will be a crucial year for the LNG industry as it marks the start of a capacity build-up which...
While global spot LNG markets are already weak, further delays at liquefaction projects are pushing the long-expected tidal wave of new LNG exports back toward summer, or even autumn. Qatargas-2, Russia's Sakhalin-2, Indonesia's Tangguh and Yemen LNG are all experiencing a drift of a further few months in schedules for first cargo loadings.
29 Jan 2009
The U.S. Environmental Protection Agency is calling out Maine and 36 other states for failing to file plans for reducing air pollution near national parks and other federally owned sites popular with tourists.
States were required to submit plans to the federal government by December 2007 on how they are addressing haze issues at 156 national parks and wilderness areas. Maine is required to file reports on three such “Class 1” areas: Acadia National Park, Moosehorn National Wildlife Refuge, and Roosevelt Campobello International Park, which is jointly run by a U.S. and Canadian commission.
The EPA put the 37 states on notice after the National Parks Conservation Association, Earthjustice and the Environmental Defense Fund essentially put the EPA on notice about the delinquent reports. The three organizations filed a complaint against the EPA in federal court last October. [Red & bold emphasis added.]
Webmaster's Comments: In Maine's report, perhaps Governor Baldacci would like to explain his supporting air-polluting LNG projects in Passamaquoddy Bay — with pollution that would affect Roosevelt Campobello International Park and St. Croix Island International Historic Site (under Acadia National Park's aegis), not to mention the area's residents — both sites downwind from the proposed LNG projects and their transiting, and air polluting, LNG carriers.
Tokyo Electric Power Co., the world’s second-biggest liquefied natural gas buyer, and Tokyo Gas Corp. agreed to extend LNG supplies by two years from ConocoPhillips’s Alaskan plant, company officials said.
The Nikiski plant, the world’s oldest LNG project that started in 1969, secured permission from the U.S. Energy Department last July to extend exports until 2011. Japan, the world’s biggest LNG buyer, needs new supplies because Indonesia, which supplies a fifth of the country’s gas, has announced plans to slash shipments because of domestic gas demand. [Red emphasis added.]
Webmaster's Comments: Indonesia's LNG export reduction may put an unexpected stress on world's upcoming new LNG liquefaction supplies.
The letter from the Clatsop County Board of Commissioners was a response to an inquiry from the Oregon Department of Justice about where the Bradwood Landing liquefied natural gas project issue stood after the overwhelming vote against running pipelines through park lands in September.
According to the Daily Astorian, the central committee voted to oust Clatsop County Commissioner Ann Samuelson - ironically, the only Democrat on the county commission - and Pete Hackett, who works in Astoria as the community liaison for the Bradwood Landing proponents, from their precinct committee seats.
Larry Taylor, the county chairman, told me the party acted after "receiving evidence that a for-profit corporation was trying to infiltrate the Democratic Party to influence their policies" at both the local and state levels.
Opponents of a liquefied natural gas terminal proposed for the Columbia River are applauding a new state land-use decision.
The Land Use Board of Appeals actually ruled against environmental groups on most of their objections to the Bradwood Landing project. But LUBA did agree with two objections related to salmon and the project’s size.
On Wednesday, February 4, 2009, at 10 a.m. (PST), staff of the Office of Energy Projects will convene an engineering design and technical conference (cryogenic conference) regarding the proposed Oregon LNG import terminal. The conference will be held at the Holiday Inn Express Hotel & Suites, in Astoria, Oregon.
The conference will review the design of the LNG storage tanks and facility, instrumentation and controls, hazard detection and controls, spill containment, geotechnical topics, and other issues related to the operation of the proposed facility. Issues related to environmental impacts and LNG vessel transit are outside the scope of the conference.
Webmaster's Comments: The conference is not open to the public.
The order comes a little more than a year after Clatsop County commissioners created or altered dozens of policies to allow NorthernStar Natural Gas to unload liquefied natural gas from ships 38 miles from the mouth of the Columbia River. The gas would be distributed by a new pipeline crossing below the river and through Cowlitz County. [Red emphasis added.]
27 Jan 2009
The Federal Energy Regulatory Commission (FERC) had received 42 comments on the Calais LNG project, as of January 16. Of those 42 documents, seven were not applicable, filing errors or submittals by Calais LNG. Six of the 42 were in support of the project, with the remaining number expressing concern or opposition.
Following an initial participation in technical discussions with the U.S. Coast Guard, the Canadian government has curtailed further participation in the review process for the Downeast LNG facility. The report states, "The eventual involvement and cooperation of Canada's maritime, environmental and public safety authorities are paramount to ensure the safety and security of the waterway."
The report also examined the rights and concerns of the Passamaquoddy Tribe and issues relating to sovereignty. In response to the Coast Guard's request for information regarding Passamaquoddy sovereignty issues, Downeast LNG submitted a legal brief rebuffing the tribe's claims, stating, "The Passamaquoddy tribal fishermen lack sovereignty or any other special fishing or sustenance rights over the waters through which LNG carriers will transit to and from the Downeast LNG facility." [Red emphasis added.]
Webmaster's Comments:Downeast LNG's Dean Girdis failed to do his homework prior to beginning his venture, and is continuing down that misguided path. Girdis and company don't hold sway over Native American and over Canadian sovereignty — just one of many mistakes undoing his project.
The new natural gas pipeline extending from the Canaport LNG terminal near Saint John to the New Brunswick/Maine border is expected to be completed later this month. The 30-inch diameter pipeline connects with the Maritimes and Northeast Pipeline on the St. Croix River at the border in Baileyville.
Webmaster's Comments: Downeast LNG and Calais LNG came to the race way too late and in the wrong place. Canaport, Northeast Gateway deepwater port, and Neptune LNG deepwater port have mooted any additional LNG import projects in northern New England, including Maine.
The venue for the showdown: a hearing on the proposed deepwater port held jointly by the U.S. Coast Guard and the Maritime Administration at the Sheraton of Eatontown. An open house starting at 4:30p is to be followed by the hearing, from 6 to 8p.
“We did have one vote before, so that’s one out of five commissioners who saw it our way before, and we hope that we can convince the others to see it our way,” he said. “We hope [Wellinghoff] can bring others to his point of view, that’s why we’re filing this petition.”
Wellinghoff, who also opposed approving an LNG project in Oregon in September, wrote in his dissenting opinion of the Sparrows Point project proposed by Virginia-based AES Corp., that building the terminal would not be in the public interest. Contrary to the opinions of the other commissioners, Wellinghoff said that the project is not essential to meet the region’s energy needs, which he said would be better served by alternative energy.
“Don’t you think it would be a little bit better if you met the conditions before you gave them the approval?” [Bart S. Fisher, a Washington, D.C., lawyer representing the LNG Opposition Team said]. “It’s kind of Alice in Wonderland justice, putting the cart before the horse.”
Natural gas producers exploiting Pennsylvania's Marcellus Shale play and landowners leasing to them have encountered an unexpected complication in the Farmland and Forestland Assessment Act or what Pennsylvanians call "Act 319".
The request could send the Bradwood Landing proposal back to the Federal Energy Regulatory Commission, where opponents of the project expect the Obama administration to appoint more sympathetic members.
Tony Green: “Both the governor’s office and the Attorney General believe that FERC has gone about this approval process incorrectly. That they should not have approved the project before it got a variety of state approvals.”
Monday's appeal does not constitute an objection to an LNG terminal in Oregon, per se. Rather, the governor, Attorney General John Kroger and state agencies contend that the regulatory commission's approval was procedurally flawed -- mainly that it was granted before necessary state permits had been processed or a sufficiently rigorous analysis of its environmental impact was completed.
In addition to the state appeal of FERC and the numerous state permits Bradwood needs, the Oregon Land Use Board of Appeals is scheduled to decide today on a challenge by conservation and tribal groups of Clatsop County's land-use approval for Bradwood.
The National Oceanic and Atmospheric Administration, the parent agency of the fisheries service, also must determine whether Bradwood jeopardizes endangered salmon on the Columbia. NOAA's new chief, Jane Lubchenco, is a marine biologist from Oregon State University.
[Gregg Kantor, the President and C.E.O. of Northwest Natural] says the Terminals would open up more sources of Natural Gas from other parts of the world, which would be good for keeping fuel prices down.
Webmaster's Comments: Kantor failed to explain how bringing more expensive LNG, compared to lower-priced domestic natural gas, would keep prices down.
Obama names clean-energy proponent as acting head of FERC
This is exciting news for greens, who are big fans of Wellinghoff, an energy law specialist who has been with FERC since 2006. In December 2007, the U.S. Senate reconfirmed him for a full five-year term. While at the agency he has helped create a new division -- the Energy Innovations Sector -- to investigate and promote new efficient technologies and practices.
He previously served as a staff attorney for the Federal Trade Commission's Energy and Product Information Division from 1978 to 1979, staff counsel for the U.S. Senate Commerce Committee's Consumer Subcommittee, and Deputy District Attorney in the Consumer Fraud Division for the Washoe County District Attorney's Office in Reno, Nevada.
In 2008, the LNG industry in North America witnessed a new trend where regasification companies started applying for permission to re-export whole or part of their imported LNG to markets outside North America. Sabine Pass LNG LP, a subsidiary of Cheniere Energy Inc. (Cheniere Energy), has submitted an application with the Federal Energy Regulatory Commission (FERC) to re-export previously imported LNG to lucrative markets overseas. Cheniere Energy has been strategically pursuing the growth of Liquefied Natural Gas (LNG) receiving terminals in North America. [Red emphasis added.]
There are several things special about the contract explains Bayards project manager Tristan Mackintosh. "It was firstly remarkable that all fourteen units were assigned to one manufacturer. And one design is scheduled for installation on the world's first LNG FPSO. Safety regulations do not get stricter than on these new, designed but not yet built units." The reason why? "LNG risk factors are arguably the highest in the maritime world. The decks will have to be large, strong and well separated physically from the FPSO hull, but also light enough they do not destabilize hull trim. Steel decks are often simply too heavy." One design will be fully winterised, heated decks and a thousand and one other features to make the deck operable 24/7 in arctic conditions. [Red emphasis added.]
Webmaster's Comments: The above statement speaks for itself. Despite an exemplary LNG shipping record, civilians are justified for wanting to live outside LNG Hazard Zones — and the world LNG industry agrees with the public. (See LNG Terminal Siting Standards Organization.)
Concern at possible over-dependence on Russian gas was a factor in the Government's decision to opt for a new-build nuclear reactor programme. It is also influenced the recent programme of new or expanded liquefied natural gas (LNG) terminals - on the isle of Grain in the Thames estuary and in south west Wales. Countries with LNG terminals can source gas from anywhere in the world. They are not dependent on any particular pipeline. [Red emphasis added.]
Webmaster's Comments: In order to bank against Russia's fickle natural gas reliability, Europe may be generating greater world competition for LNG.
26 Jan 2009
FERC has granted an extension of time to construct and place in service the AES Ocean Express natural gas pipeline that will transport gas from a receipt point on the maritime boundary between the United States and the Commonwealth of The Bahamas to onshore delivery points in Broward County, Florida.
TORRANCE, CALIF.: Twice in the last 30 years, natural gas companies have tried to use scare tactics to persuade Californians to allow building of huge liquefied natural gas terminals along this state's coast.
Both times, environmental and consumer groups and some Indian tribes fought for years against proposals that appeared to be "greased," guaranteed approval because the people behind them had solid connections in the state and federal governments.
The newest Annual Energy Outlook report from the federal Department of Energy, developed under the now-departed, pro-LNG George W. Bush administration, concluded that natural gas imports will diminish by 2030 to just 3 percent of what's used in this country, from the current 16 percent.
The forecast adds that use of natural gas for industry and homes will be flat for at least the next 20 years. Combining more domestic supply with flat usage means there will soon be virtually no need for foreign-based supplies of gas. Say sayonara to the LNG push, at least for awhile. [Red & bold emphasis added.]
The spill in Aniva Bay on the south of Sakhalin took place six kilometres from a major liquified natural gas (LNG) plant being built by the international consortium exploiting its Sakhalin-2 reserves.
Russia's Gazprom is a majority shareholder in the consortium developing the Sakhalin-2 reserves, with British-Dutch energy major Shell and Japanese conglomerates Mitsui and Mitsubishi Corporation the minority partners. [Red & bold emphasis added.]
Platts LNG Daily reports that an analyst with Barclays Capital said last week that he believes the dispute over natural gas prices between Russia and Ukraine could encourage European imports of LNG, slowing the growth of U.S. LNG imports in 2009. Bill Cooper, president of the Center for LNG, disputed the hypothesis, stating that he does not think the dispute will have a great effect on the U.S. market in the short-term.
Webmaster's Comments: European nations are certainly thinking of ways to avoid being victims of Russia's political-tool natural gas pipeline unreliability. One solution is for Europe to construct more LNG import terminals — reducing reliance on undependable Russia, while increasing world competition for LNG. This could increase US LNG export potential while simultaneously keeping LNG prices high, compared with US domestic natural gas.
24 Jan 2009
The US Coast Guard's recently released Waterway Suitability Report, prepared for the Federal Energy Regulatory Commission's (FERC) Downeast LNG application, will have the residents of New Brunswick's premier resort area burning again.
A piece in Platts LNG Daily [subscription required] suggests that an LNG vessel waiting to unload at Excelerate's Northeast Gateway LNG deepwater port off the Massachusetts coast may be contributing to relatively low regional natural gas prices during the winter months.
Webmaster's Comments: The Northeast Gateway LNG deepwater port proves Calais LNG site selection rationalization to be wrong. Calais LNG wants the public to believe that weather conditions in the Gulf of Maine are too severe for LNG offloading facilities. Offshore LNG terminals are better suited to rough weather than shoreside terminals like Calais LNG is proposing, due to the suprerior capabilities of offshore submerged buoy technology that's been weather-tested for decades in the oil industry in the North Sea and elsewhere. For example, submerged buoy technology at the Gulf Gateway facility offshore from Louisiana allowed an LNG vessel to offload its entire cargo during Hurricane Katrina.
“When FERC reviews a proposed LNG import project, our primary concern is assuring public safety,” FERC Chairman Joseph T. Kelliher said. “We have done so in this order, by attaching 169 conditions that will protect public safety and mitigate any adverse environmental impact and assure the AES Sparrows Point LNG Project will provide service in a safe and secure manner and provide fuel to generate electricity and heat homes. I realize this is not a popular decision, but it is the correct decision, rooted in a voluminous record and based on sound science.”
Webmaster's Comments: If FERC's primary concern really were assuring public safety, then FERC wouldn't be ignoring the LNG industry's own best practices regarding terminal siting during FERC's permitting process. (See LNG Terminal Siting Standards Organization.)
The trio of oil companies holding most of the North Slope gas -- BP, Conoco Phillips and Exxon Mobil -- have said an overland pipe is more economically viable than an LNG project. [Red emphasis added.]
Acting Chairman Wellinghoff is an energy law specialist with more than 30 years experience in the field. Before joining FERC, he was in private practice and focused exclusively on client matters related to renewable energy, energy efficiency and distributed generation. While in the private sector, Acting Chairman Wellinghoff represented an array of clients from federal agencies, renewable developers, and large consumers of power to energy efficient product manufacturers and clean energy advocacy organizations.
His experience also includes two terms as the State of Nevada’s first Consumer Advocate for Customers of Public Utilities. While serving in that role, Acting Chairman Wellinghoff represented Nevada’s utility consumers before the Public Utilities Commission of Nevada, the FERC, and in appeals before the Nevada Supreme Court. While Consumer Advocate, he authored the first comprehensive state utility integrated planning statute. That statute has become a model for utility integrated planning processes across the country. [Red & bold emphasis added.]
He cast the lone dissenting vote in a Jan. 15 commission order approving AES Corp.’s application to build a liquefied natural gas terminal in Baltimore’s harbor. Wellinghoff said that there are other ways for the area to get its gas supplies, and environmental and local concerns were not fully evaluated.
He also voted against a proposed NorthernStar Natural Gas Inc. LNG terminal in Oregon. [Red & bold emphasis added.]
Webmaster's Comments: A sea change may be taking place at FERC. Wellinghoff appears loathe to simply rubber stamping each and every LNG proposal that crosses FERC's desk.
Prices of cargoes to Asia for immediate delivery have already dropped 50 percent to around $10 per million British thermal units in January from a year earlier, Takashi Kuroko, Mitsubishi's vice president for global gas, told reporters today in Jakarta. Volumes may halve from as much as 4 million metric tons in 2008, he said.
Webmaster's Comments: This is more bad news for Downeast LNG and Calais LNG. Although the cost of the LNG would be lower in the short term — making LNG more competitive with domestic natural gas, but with less domestic demand — as the story indicates, as the economy recovers, prices will increase again, pricing LNG out of the domestic market and tanking LNG import terminal investments.
It requires no import of fuels. It does not replace oil (or not yet, ie as long as electric cars are not around) but it does replace natural gas, whose long term availability is very much in doubt and which availability will soon be depending on LNG imports from places like Qatar, Nigeria or Russia. [Red emphasis added.]
Implications: After years of sluggish growth, U.S. gas production increased by more than 10% in the past two years, due to increased conventional drilling (in response to higher prices) as well as unanticipated growth from an unconventional source, shale gas deposits. At the same time, gas demand has been flat due to the economic recession. [Red emphasis added.]
Webmaster's Comments: Despite the glut of domestic natural gas, the need for US energy independence, and the business flurry to export US natural gas in the form of LNG, Gerson Lehrman Group believes LNG will "come back." Considering being blind-sided by "unanticipated growth" in domestic natural gas and the current 100-year domestic supply, just how confident should anyone be with Gerson Lehrman Group's prediction of an LNG revival?
22 Jan 2009
Repsol Energy North America Corporation ("RENA"), an affiliate of Repsol YPF, S.A. ("Repsol", Baa1, stable) has signed a 25-year firm service agreement with MNE LLC, which is expected to commence on March 1, 2009. [Red emphasis added.]
Webmaster's Comments: In English the story means that Canaport has a 25-year contract with Maritimes & Northeast Pipeline to take Canaport's gas. Canaport faces no competition for at least 25 years. This should dispel, once and for all, the idea that Canaport opposes the Passamaquoddy Bay LNG proposals out of fear of competition from the proposed US projects.
Then there are those whose optimism is not so much sincerely felt as it is an artificial attempt to mislead and deceive. It seems that despite a growing mountain of the most discouraging news, the leaders of Weaver’s Cove Energy continue to summon up their special brand of corporately manufactured optimism, publicly portraying their battered and beaten liquefied natural gas proposal as still viable.
Like the uninvited party guest who stays long after the celebration ends, Weaver’s Cove Energy is still hanging around, insisting that the music keep playing, the drinks keep flowing and the revelry continue. No matter how many setbacks this project endures, they simply don’t seem to realize the party’s over. [Red emphasis added.]
Webmaster's Comments: If the above seems familiar it's because all LNG developers have apparently taken the same course in theatrical optimism.
The US Coast Guard, in its Waterway Suitability Report for the Downeast LNG project, has dealt each of the Passamaquoddy Bay LNG projects a fatal blow by requiring they obtain Canada's cooperation — cooperation that Canada has forcefully and repeatedly stated won't be forthcoming.
The principals of Downeast LNG and Calais LNG are now appearing as kings in a contemporary version of "The Emperor's New Clothes."
Led by COA, a broad coalition of ocean advocates, the groups are rallying residents, businesses, organizations and elected officials to attend two public meetings regarding the New York-based Atlantic Sea Island Group (ASIG) project.
The ruling sets the stage for veto action by both Gov. Jon S. Corzine and the governor of New York. The LNG facility would be located 13 miles off the coast of New York, which already received adjacent coastal state status. Under the Deepwater Port Act, governors of adjacent coastal states have the authority to veto proposed deepwater port projects, such as the "Safe Harbor Energy" proposal by ASIG.
In a decision that had all the surprise of snow in January, the Federal Energy Regulatory Commission last week gave conditional approval to the proposed liquefied natural gas (LNG) terminal and pipeline at Sparrows Point. The agency's choice to side with AES Corp., despite significant environment and community concerns, could be predicted months, if not several years, ago.
Fortunately, the FERC order is far from the final word. Opponents could drag out this fight for years. Surely, there's an argument to be made when an agency's poodle-like attitude toward regulating industry makes the Securities and Exchange Commission look like a veritable pit bull with a taste for financiers.
Dissenting commissioner Jon Wellinghoff found the project would not be in the public interest because of the lack of availability of LNG for import in the face of a drastic increase in the estimate of available domestic gas.
FERC announced in today's Federal Register that it will prepare an environmental assessment analyzing the LNG re-export, boil-off gas liquefaction, and LNG truck delivery projects proposed by Freeport LNG. [Red bold emphasis added.]
Webmaster's Comments: Freeport LNG is one of seven new North American LNG export projects in play.
On January 15 FERC issued an order clarifying that the Kenai LNG liquefaction facility must comply with the same reporting and inspection requirements under Section 3 of the Natural Gas Act that apply to other U.S. LNG terminals.
West Coast News
Kitimat LNG, which is developing a liquefied natural gas export plant in British Columbia, announced that it has received interest for a stake in the company. This announcement follows an invitation for expressions of interest which Kitimat LNG submitted in November. The proposed plant will have two LNG storage tanks with capacities of 210,000 cubic metres, with potential future expansion to three tanks. Kitimat LNG plans to begin exporting gas produced in Western Canada by 2013. [Red emphasis added.]
Webmaster's Comments: Kitimat LNG is one of seven new North American LNG export projects in play.
Woodside last week suspended a plan to import liquefied natural gas into California because of weaker market conditions and said today it will take a charge to write down the venture. [Red & bold emphasis added.]
With winter inventories still at comfortable levels and production forecast to grow slightly this year after strong gains last year, analysts expect a shrinking economy to sharply cut industrial demand and leave the market well supplied.
[T]he unexpected boom in domestic production last year, primarily from unconventional sources like shale gas, helped drive output up six per cent in 2008, easing supply concerns and cutting gas prices by more than 60 per cent from their early July highs to about $5 this month.
With inventories still running above last year and likely to end winter at above normal levels, and consumption projected to fall one per cent or more in 2009 as the economy slides deeper into recession, many analysts expect the supply-demand balance to remain very loose this year. [Red emphasis added.]
…LNG imports could exacerbate the 4-5 bcfd of excess gas already in markets. That large overhang is "primarily due to success of horizontal drilling in new shale plays and weak demand from chemical, paper, mining, manufacturing, and refining sectors." said Pritchard Capital analysts.
Vienna -- European countries vowed Wednesday to avoid a repeat of the crisis that saw crucial gas supplies cut off for 15 days due to a row between Russia and Ukraine, as they counted the cost of the dispute.
Webmaster's Comments: Russia's annual winter natural gas dispute with the Ukraine is developing greater European demand for LNG, perhaps negating predictions by some of a future LNG world surplus.
20 Jan 2009
Projects on back burner due to costs
Half of those have been mothballed recently for lack of supply and observers expect the remaining projects will be put on hold indefinitely, aside from the Canaport LNG terminal already in construction in Saint John, N. B. [Red emphasis added.]
[Project opponents] may get help from lone FERC dissenter Jon Wellinghoff's written opinion released Friday. Wellinghoff said that the community's environmental and community concerns were not "fully and fairly evaluated" and that requests to postpone a final decision were reasonable given the complexity of the case. [Red emphasis added.]
The site currently has the capacity to hold about 1.5 billion cubic feet of gas per day. Phase II — which includes the addition of a second dock, a third 15-story-tall holding tank and a second vaporization structure — would allow for an additional 2.5 billion cubic feet of gas per day.
Currently, the domestic market for gas is sluggish. But Henry said studies show the market could be picking up soon, and he anticipated ships could start arriving at the terminal during the summer months.
Also, foreign liquefaction plants, which liquefy natural gas Freeport LNG customers might buy, are set to come online by 2013, Henry said. The production of those plants will increase the amount of gas worldwide, increasing the need for a second dock.
Webmaster's Comments: Freeport LNG's business logic fails to convince. Just because more LNG will be available worldwide doesn't mean there will be a need to import more, especially when LNG is more expensive than domestic natural gas, and when there is a glut of domestic natural gas in the US.
The LNG market is growing at its slowest pace in 28 years as the global economy slows. Forward contracts show prices may slump about 70 percent, and rivals plan to increase supplies by 33 percent, according to Citigroup Inc.
With slumping Asia demand, the excess LNG must go to the U.S. or U.K. at local prices, Citigroup said. U.S. gas futures for June are trading at $5.15 per million Btu, while U.K. gas is quoted at about $6.50 in the same period. That compares with $20 sellers such as BG secured from Asia last year. [Red emphasis added.]
17 Jan 2009
The U.S. Senate passed legislation to protect the river under the National Park Service’s “wild and scenic” program. The bill cleared the House last July, but since that occurred during a previous legislative year, the House will need to approve it again this year before it can go to the president’s desk.
The Taunton River is the longest un-dammed coastal river in New England. It supports 45 species of fish and many species of shellfish, including seven types of freshwater mussels, and its archaeological treasures date back 10,000 years. The watershed is a habitat for 154 species of birds, including 12 rare types. It is also home to the river otter, mink, gray fox and deer.
Federal energy regulators have approved a proposal for a liquefied natural gas terminal near Baltimore despite a request from Maryland's congressional delegation that the decision be delayed until President-elect Barack Obama takes office.
The Federal Energy Regulatory Commission voted 4-1 Thursday to approve the project, with Commissioner Jon Wellinghoff casting the only vote against the project, said Tamara Young-Allen, a spokeswoman for the commission.
Mark Slaughter, Enstar’s gas supply manager, said operators of a liquefied natural gas plant in Kenai, which serves as a gas supply backstop to Enstar, were “scraping the bottom of the barrel” in their ability to divert gas from LNG production to help Enstar offset shortages of gas from producing wells in gas fields in the region.
What complicates the regional gas-supply picture is uncertainty over the future of the LNG plant. A federal license allowing exports of liquefied gas expires in March, which would result in the plant being closed. While the U.S. Department of Energy is likely to issue an extension of the export permit before March it would be for only two years.
Webmaster's Comments: This points to a lack of national energy security planning in favor of corporate interests. Allowing exporting of LNG when the state needs the natural gas doesn't make sense — other than to the company making the profit from the LNG exports.
It was only about a month ago that the firm asked regulators to delay the release of an environmental review while it scaled back the project, which was planned for a spot 18 miles off Catalina, 23 miles off the Palos Verdes Peninsula and 27 miles away from LAX.
"Perhaps there is a role for LNG as a transitional fuel, but our region already has access to adequate gas supplies to meet market demands," [ U.S. Rep. Jane Harman] said in an statement. "I'm glad that Woodside recognized the level of local concern over this project and am grateful to the elected officials and residents who made their opposition known."
16 Jan 2009
[Member of Parliament and Cabinet Minister Greg Thompson], who is opposed to any LNG projects in Passamaquoddy Bay, said that in the financial world as it is today it will be difficult for the proponents to raise the capital necessary for a project like this, especially when they are taking on a sovereign nation that is opposed to the project.
“As a sovereign nation, we have taken the position that we are going to stand up for our citizens and the environment so that, coupled with other market realities, should resonate with the proponents of this project.”
“Both are badly needed. We are already at work addressing the Coast Guard’s recommendations as reflected in the WSR, and we are pushing full speed ahead with our plans to get this project approved and built.”
Webmaster's Comments: While it's true that Downeast LNG would increase Maine's supply of natural gas and Washington County does need good paying jobs, the reality is that Maine doesn't need Downeast LNG's proposed supply, since all of the state's additional natural gas requirements have already been contracted by the completed Maritimes and Northeast Pipeline expansion and Canaport's output of natural gas that will come online in just a few months.
On top of that, the US Coast Guard's Waterway Suitability Report requires Downeast LNG to obtain Canada's cooperation — recognition of Canada's sovereignty over the Canadian portion of the waterway, and recognition of Canada's concerns for its citizens, its economy, and its environment. Downeast LNG's hopes hang on an unrealistic premise: Canada's cooperation — something that Canada has made clear will never happen.
The US Energy Information Administration sees Canadian gas shale formations as an increasingly important part of US natural gas imports in 2009. In its "US Natural Gas Imports and Exports: 2007" special report published this month, EIA cited renewed interest and optimism regarding unconventional gas recovery in Canada following the successes seen in the northeast Texas Barnett shale and other formations in the Lower 48 states.
The [Canaport] terminal is Canada's first and will be used to meet demand in the US northeast and eastern Canada starting early 2009. Construction of three 2.5 bcf storage tanks is complete. Total sendout capacity is 1.2 bcfd, with the first phase of operations using existing and expanded capacity on the Maritimes & Northeast Pipeline to move gas into the US.
Webmaster's Comments: Merely 25% of Canaport's sendout capacity is destined for Maine — volume enough to supply Maine's additional needs for natural gas. That's noteworthy, since Maine requires less natural gas than Downeast LNG's or Calais LNG's planned output; they're overkill, and for what purpose?
Boston's additional natural gas requirements are being met by the Northeast Gateway (completed) and Neptune LNG (to be completed in 2009) projects off Gloucester, MA, so that area isn't a market for Downeast LNG or Calais LNG, either.
There's no demonstrable need for any LNG projects in Passamaquoddy Bay. Downeast LNG and Calais LNG are projects without a market.
WASHINGTON – In another blow to oil giant Hess Corp.’s plans to build a liquefied natural gas terminal in Fall River, the U.S. Senate has voted to designate 40 miles of the lower Taunton River as a protected area under the 1968 Wild and Scenic Rivers Act.
A decade-long effort to protect the Taunton River as part of the national Wild and Scenic Rivers System passed the U.S. Senate Thursday and is likely to become law soon. That’s bad news for Weaver’s Cove Energy and its efforts to build a liquified natural gas terminal in Mount Hope Bay.
MARAD announced in today's Federal Register that it has changed the location for an open house and public meeting scheduled for January 29, 2009, regarding the Safe Harbor LNG deepwater port proposal.
Today FERC issued a conditional approval to the AES Sparrows Point LNG terminal and associated Mid-Atlantic Express natural gas pipeline. In a press release, Commission Chairman Joseph T. Kelliher said that FERC's "primary concern is assuring public safety," and noted further that 169 conditions attached to the authorization will "protect public safety and mitigate any adverse environmental impact."
"I want to express my sincere disappointment in today's decision by FERC in approving a facility at Sparrows Point that could have catastrophic security and environmental implications for our state, including potentially severe impacts to the Chesapeake Bay and to those who use it like our recreational fishermen and boaters," O'Malley said in a statement.
Federal and state lawmakers and community leaders fought the project in and out of court over the last year. They raised concerns about the public safety of the proposed terminal and its impact on the environmental conditions of the Chesapeake Bay.
Webmaster's Comments: FERC repeatedly violates SIGTTO best practices in its LNG terminal permitting, claiming those best practices are merely "advice" and not regulations. They're "best practices," because ignoring them threatens human life and the LNG industry itself, demonstrating the industry is more concerned about safety and public safety than is FERC.
WASHINGTON, D.C.: The Federal Energy Regulatory Commission (FERC) reports that it will make a decision by May 26 on whether to approve Sabine Pass LNG's proposal to modify the operations of its existing LNG receiving terminal in Cameron Parish, La. for the additional purpose of exporting LNG.
Webmaster's Comments: Of the six–seven LNG export projects planned in North America, this is one of two completed LNG import terminals converting to LNG exports.
Today FERC upheld its previous decision to reauthorize construction and operation of the Cove Point LNG Expansion project and reaffirmed its determination that the Commission has adequately addressed gas quality issues associated with delivering regasified LNG into Washington Gas Light's existing distribution system.
Separately, FERC also upheld its authorization of the Bradwood Landing LNG project, noting that the project has not substantially changed since the Commission issued its Draft Environmental Impact Statement for the project.
KSRM Radio reports that Alaskan State Rep. Paul Seaton (R-Homer) wants Kenai LNG to sell natural gas produced from the Cook Inlet to a greater number of Alaskan consumers before exporting it as LNG to Asian markets.
Webmaster's Comments: Rep. Seaton is advocating sale of natural gas, not LNG, to residents. KSRM Radio's online news story inaccurately refers to selling "LNG" — rather than LNG-source natural gas or natural gas that would otherwise be converted into LNG — to Alaskans.
Several environmental groups, including Columbia Riverkeeper and the Sierra Club, filed a letter with FERC requesting that the Commission revoke its order authorizing the Bradwood Landing LNG regasification terminal.
SALEM - A group supporting proposals to build a liquefied natural gas terminal and corresponding pipeline in Oregon launched Tuesday what it called a "truth offensive" to counter efforts by pipeline opponents.
Meanwhile, outside the Capitol, hundreds carried signs opposing the project chanted anti-LNG slogans and cheered several speakers, including new Attorney General John Kroger, who voiced opposition to the pipelines.
The [LNG Public Protection Act] would restrict Oregon agencies from issuing state land leases, water rights or wetland fill permits unless the Oregon Department of Energy decides there is a need for more natural gas in the state. (Federal regulators rebuffed Oregon Gov. Ted Kulongoski last year when he demanded a similar “needs analysis.”)
Chuck Deister, a NorthernStar spokesman, said the legislation’s sponsors “have no idea how natural gas markets actually work” and that the need for the gas was “well-established” by the Oregon Utilities Commission last year.
Webmaster's Comments: NorthernStar's Deister apparently has no idea how the economy works. The natural gas market recently was turned upside down with the revelation that there is a glut of natural gas in the US. The result has been the advent of 6–7 LNG export projects in the US and Canada, including conversion of two already-built LNG import terminals into export terminals.
“I’ve long said the Woodside LNG project posed serious environmental problems and made LAX a bigger security risk,” said Congresswoman Jane Harman. “Perhaps there is a role for LNG as a transitional fuel, but our region already has access to adequate gas supplies to meet market demands. I'm glad that Woodside recognized the level of local concern over this project and am grateful to the elected officials and residents who made their opposition known.” [Red emphasis added.]
An Australian company announced Thursday it had suspended its plan to build a controversial offshore [liquefied] natural gas terminal 27 miles from Los Angeles International Airport, citing the downturn in the world economy.
One other is still proposed in Southern California off the coast of Santa Barbara County, said Tom Ford, executive director of Baykeeper. Another has been built just south of Ensenada, Mexico. [Red emphasis added.]
Webmaster's Comments: This is more evidence that additional sources of LNG are not economically viable for the United States.
The forecast from consulting firm Wood Mackenzie flies in the face of recent activity in the commodity markets, where natural-gas prices have fallen amid jitters about energy usage. [Red & bold emphasis added.]
Webmaster's Comments: But, see LNG insufficient… story, below.
Webmaster's Comments: But, see LNG insufficient… story, below.
While there is no doubt that the US now has huge quantities of unconventional gas, the key question for the future is obvious: where are prices going? The technology breakthroughs in shale gas production are allowing producers to tap huge resources that were previously uneconomic. But these new shale resources are coming onstream at a time of weakening energy demand both in the US and the world. And there’s another wildcard: liquefied natural gas. Two recent reports are predicting near-record US LNG imports as new liquefaction capacity comes onstream at the same time that world gas demand is stagnating. All of these factors are combining to make for a complicated outlook for the US gas business.
US gas production is expected to be nearly 8 percent higher this winter than a year earlier, based on an analysis by Virginia-based ICF International . The Barnett shale has been the single biggest driver in US gas production growth. Barnett shale production is now about 4.4 bcf/d cubic feet per day compared with 1 bcf/d just four years ago. [Red emphasis added.]
Europe may have to import four cargoes every day to compensate for the decline in Russian supplies, the report said. About 10 cargoes to 15 cargoes a month, or about 10 percent of the Russian supply gap, may be sourced from the spot market by diverting shipments earmarked for the U.S., the report said.
14 Jan 2009
The Water Suitability Report for Downeast LNG released by the U.S. Coast Guard validates our plans for safe and secure transit of LNG to and from our terminal in Robbinston, Maine, and we stand ready, as we always have, to co-operate with Canadian authorities as our ships move through Canadian waters.
Webmaster's Comments: Girdis first blamed the State of Maine for his problems. Now he's blaming Canada.
Girdis wants the public to ignore regulatory reality: Congress requires the US Coast Guard to prevent passage when waterways are unsuitable for hazardous cargo transport. The US Government has that authority, and so does Canada. In this case, Canada holds a higher standard, and is denying transit.
Girdis could have avoided the problem by siting his project in a more appropriate location without transboundary complications. The US Government — not Canada — has placed this onus squarely where it belongs: on Dean Girdis and Downeast LNG. It's time for Girdis to take responsibility for his inappropriate site selection, and to pack up and go home.
"They [Downeast LNG, Calais LNG, and Quoddy Bay LNG] are simply dreaming in Technicolor. They can blame Canada, but the fact is they were late in the game and didn't do their homework when other companies had their homework completed." [Red emphasis added.]
The Army Corps of Engineers said it will not issue a permit for a proposed liquefied natural gas terminal at Sparrows Point and a pipeline through Maryland to Pennsylvania until the project's developer has complied with federal wildlife regulations, prepared mitigation plans for wetlands that might be disturbed during construction and met other requests for information.
SALEM, Ore. — John Kroger, Oregon's new attorney general, took a hard line against proposed liquefied-natural-gas (LNG) terminals and pipelines Tuesday, saying they are bad for landowners, the environment and energy independence.
Nation's natural gas imports likely to decline, experts say
The price of natural gas has dropped by half since July; domestic production of natural gas climbed by 7 percent last year. And according to a December report from the California Public Utilities Commission, pipeline capacity in California is now “well in excess of demand” even as a new pipeline that will provide the state access to low-priced supplies from gas fields in the Rockies is expected to come on line in 2011.
Furthermore, the report says, domestic natural gas prices in California are “likely to be lower than global LNG prices in the near term” and significant imports to California from a new LNG terminal off Baja, Mexico, are unlikely.
The report forecasts that natural gas imports, including those shipped in by pipeline from Canada, will decline from 16 percent of the nation’s supply today to 3 percent by 2030. [Red & bold emphasis added.]
On Monday the Maritime Administration (MARAD) announced the availability of a report analyzing U.S. maritime policy. The report concludes that U.S. maritime policy should be more supportive of international trade but highlights improvements in policies fostering U.S. participation in the LNG trade through MARAD's involvement in the licensing of LNG deepwater ports and the agency's efforts to increase the number of U.S. mariners aboard LNG vessels.
13 Jan 2009
"Dean Girdis is being bold saying we should sit down and negotiate this — that's not going to happen," the mayor said, referring to the president of Downeast LNG, one of three companies proposing to ship LNG into Passamaquoddy Bay.
Webmaster's Comments: Downeast LNG's Dean Girdis and the other LNG developers in Passamaquoddy Bay need to face reality. The US Coast Guard requires the developers to obtain Canada's cooperation before the projects can obtain LNG, and Canada clearly will not provide that cooperation. LNG projects in Passamaquoddy Bay have no future.
[T]he WSR acknowledges that "a significant portion of the transit route" to Downeast is contained within Canadian waters and "[t]he eventual involvement and cooperation of Canada's maritime, environmental, and public safety authorities are paramount to ensure the safety and security of the waterway." [Red & bold emphasis added.] (Jan 9)
Webmaster's Comments: The US Coast Guard's requirements are clear: No Canadian cooperation means no LNG projects in Passamaquoddy Bay.
Because treaties govern the use of international waters, however, Canada may not be able to veto the plan. And it already has permitted LNG terminals in New Brunswick, so it may simply be objecting to any competition south of the border.
Webmaster's Comments: Apparently the Portland Press Herald (PPH) editorial page staff failed to do two things:
- Read the Coast Guard's Waterway Suitability Report (WSR); and
- Inform themselves about LNG in New Brunswick.
If the editorial staff had actually read the WSR, they'd recognize that it is the US this time that is recognizing Canada's authority to prevent LNG transits into Passamaquoddy Bay. The US is rightly requiring Downeast LNG to obtain Canada's cooperation before the project can accept LNG transits.
The PPH claims New Brunswick has permitted terminals (that's plural). In truth, there is only one LNG terminal permitted in New Brunswick, the Canaport LNG facility. It will be sending just 25% of its output to Maine, with the rest going to Canada. Maine indicates that it needs no more than that small percentage. Plus, Boston's future needs are being met by the two new terminals offshore from Gloucester, Massachusetts.
Maine's requirement for additional natural gas doesn't justify building an LNG import terminal and expanding the Maritimes & Northeast Pipeline, unless rate payers in Maine who use natural gas want to pay more for it. Doing so doesn't make sense, and neither does the PPH editorial.
In Atlantic Canada there are several existing and potential point and non-point sources of contaminants. These include vessel discharges, aquaculture operations, land run-off, oil and gas activities, and dredging (through remobilization of contaminants) to name a few. Gaskin (1987) called attention to the fact that current circulation in both the Bay of Fundy and Gulf of Maine, where right whales feed, is semi-enclosed for at least part of the year. This means that contaminant gradients could become established from the inshore to the offshore regions. Recent reviews of information on contaminants in the Bay of Fundy have shown clear cause for concern (Percy et al. 1997). A wide array of contaminants, including those described above, are present in the environment and in the food web.
According to the RPA, activities that could degrade or destroy critical habitat potentially include oil and gas development, energy development using tidal or current sources, production of intense noise, contamination, or other activities that alter habitat in a way that would affect prey abundance. Climate change and invasive species are also identified as potential threats to critical habitat. Whether a specific activity would destroy critical habitat would depend heavily on the intensity and extent (in time and space) of the activity, how the activity was carried out, and the mitigation measures employed.
"It's time to create the clean energy age,'' Markey said in an interview. "My goal is now to create an energy policy that creates millions of new jobs in the United States,'' many of them in New England, where high-tech firms can benefit from Obama's proposed Green Jobs initiative, Markey said.
Markey and Obama also have very similar visions on how to reduce American reliance on foreign oil and clean the air, such as creating millions of "green jobs'' by investing in new energy technologies.
On Dec. 8, a U.S. District Court judge in Washington ruled New Jersey's government should have veto power over a proposal by Manhattan-based Atlantic Sea Island Group for a gas terminal to be constructed 13 1/2 miles south of Long Beach and 19 miles east of the Jersey shore. New York State has that power.
Meanwhile, there was a development Dec. 10 related to the proposed Broadwater Energy LNG platform for Long Island Sound. The Commerce Department in effect tossed to the incoming Obama administration the matter of whether the department should, as Broadwater requests, overrule New York State's rejection of that project last year. The Commerce Department pushed back the deadline for accepting documents related to its decision from Dec. 15 to Feb. 13.
The Federal Energy Regulatory Commission said yesterday that it plans to vote this week on a proposal to build a natural gas terminal in Sparrows Point and an 88-mile pipeline to Pennsylvania, despite a request to delay action until concerns about an endangered bat and a threatened turtle can be addressed.
In a letter to the FERC last week, Willie Taylor, director of the office of environmental policy for the wildlife service, a bureau of the U.S. Department of the Interior, asked the commission to "withhold certification" of the project until the habitat issues are resolved.
"We had hoped this determination would have FERC table the project, but we know the agency is trying to get everything approved before the administration changes," Carroll said. "This is not by any stretch a done deal, but FERC has basically not seen an LNG facility it didn't like. We believe the facility will be given approval but with a long list of conditions before construction can begin."
"We are encouraged that MC has put its support behind Kitimat LNG's export terminal," said Roy Dyce, President and CEO of PNG. "This development demonstrates the value of the Kitimat LNG export terminal and the KSL Project, and is a significant step in opening new markets for natural gas from the exciting new plays under development in northeast British Columbia." [Red & bold emphasis added.]
The LNG Public Protection Act is slated to be introduced in this session of the Oregon Legislature. The act would prohibit state agencies from issuing permits to developers of LNG projects unless those developers can demonstrate that the projects are needed.
FERC has placed on the agenda for its January 15, 2009 meeting three LNG proceedings: AES Sparrows Point LNG; Bradwood Landing LNG; and Dominion Cove Point LNG. Of particular note, the Commission will consider whether to approve or deny the AES Sparrows Point LNG project.
The state's Land Use Board of Appeals is slated to decide today on an appeal of Clatsop County's land-use approval of the Bradwood Landing LNG terminal project, proposed about 20 miles east of Astoria on the Columbia River.
Then on Thursday, the Federal Energy Regulatory Commission will rule on various appeals of a conditional approval of the Bradwood project it granted in September. That decision may determine whether Gov. Ted Kulongoski, with the support of the new and environmentally outspoken attorney general, John Kroger, is forced to back up his long-standing complaints about the agency's regulatory process with a federal court challenge.
Rep. Deborah Boone, D-Cannon Beach, said Monday that she has submitted a draft bill to legislative counsel that would strengthen state agencies' authority over LNG siting. Sen. Floyd Prozanski, a Democrat representing south Lane and north Douglas counties, will sponsor the Senate version.
The bill essentially would codify at a state level what state leaders have been calling on federal regulators to do for years: prove that LNG is needed in Oregon, and that the projects would meet public safety and natural resource standards. Additionally, the bill would require some demonstration that imported gas from any LNG terminal would be cheaper than domestic sources and that the project would be consistent with state standards for reducing greenhouse gas emissions.
As the recession drags down North American demand, growing production means more LNG tankers will end up in Europe, Harris said. Italy expects to start imports at a new LNG terminal at Rovigo by June, while the U.K. will begin three more receiving plants this year. More are under construction in Spain and France. [Red emphasis added.]
Reports from Europe today say that gas deliveries to Europe may have come to a complete halt; Russia and Ukraine are blaming each other for the disruption. This will undoubtedly bring a wry smile to the faces of conservatives who in the 1980s warned Europe against relying too heavily on Russia for natural gas supplies. President Reagan tried to stop the pipeline project back then. Back in 1982, an American Enterprise Institute report warned that the Soviet pipeline would be a "steel noose" that would create the potential for "economic blackmail."
Webmaster's Comments: The US government has invited Russia to own US energy infrastructure. The above story indicates the kinds of problems we could expect.
12 Jan 2009
The U.S. Coast Guard's top official in the region said Friday that a continued lack of co-operation from Canadian officials with their U.S. counterparts would prevent his agency from allowing the tankers into the bay.
"We're going to need the co-operation of the Canadian government for some kind of security plan and if we don't get it that will seriously impact our ability to allow the vessels to go through," said U.S. Coast Guard captain of the port for northern New England, James McPherson.
Webmaster's Comments: The US Coast Guard's Waterway Suitability Report is very clear. Even beyond the "innocent passage" issue, Downeast LNG is stymied; Canada's cooperation is required, and the onus to obtain that cooperation falls on Downeast LNG — something that Canada has repeatedly stated will not happen. Downeast LNG's project along with Calais LNG and defunct Quoddy Bay LNG are without futures and are needlessly continuing to cost US taxpayers to deal with their doomed projects.
Asked whether Canada would bow to U.S. pressure to allow LNG tankers into the treacherous waters of Head Harbour Passage, [Cabinet Member and Member of Parliament Greg Thompson] has vowed, "We're not going to negotiate - period."
The U.S. permitting process is not relevant to Canadian lawmakers, and federal authorities on both sides of the border understand this. Even the U.S. Coast Guard has observed that Canadian co-operation is vital for the Downeast LNG project to proceed. That co-operation will not be granted, under any circumstances. As far as the federal government of Canada is concerned, the issue is closed. [Red emphasis added.]
James McPherson, the U.S. Coast Guard's Captain of the Port for Northern New England, told the Telegraph-Journal (New Brunswick, Canada) that a failure to reach an agreement between American and Canadian authorities regarding LNG vessel transit through Canadian waters could hinder the construction of the LNG terminals proposed for the Passamaquoddy Bay area in Maine, including Downeast LNG's proposed project. McPherson notes that the Coast Guard is "going to need the co-operation of the Canadian government for some kind of security plan and if we don't get it that will seriously impact our ability to allow the vessels to [transit Canadian waters to reach potential terminal sites]." [Red emphasis added.]
Webmaster's Comments: The report isn't all that favorable. Girdis's spin is a desperate attempt to put a positive light on his failed project. Why would the State of Maine be positively impressed by a US Coast Guard report that requires Downeast LNG to obtain permission and cooperation from Canada when it is clear to the state and the rest of the world — including Dean Girdis, although he won't publicly admit it — that Canada won't comply?
FERC Chairman Joseph T. Kelliher has sent a response to a letter sent by U.S. Sens. Arlen Specter (R) and Bob Casey (D), and U.S. Reps. Joseph Pitts (R) and Jim Gerlach (R) regarding the proposed AES Sparrows Point LNG regasification project. In his response, Chairman Kelliher notes that any public comments received by FERC during the 30-day period following the EPA's notice of availability of the Final Environmental Impact Statement for the Sparrows Point LNG project will be taken into consideration by the Commission before deciding whether to approve the project. However, the Chairman notes that he does not believe that additional public meetings will provide any new information to the Commission at this time.
9 Jan 2009
“The devil is in the details of this Washington-created document with huge hurdles for the proposed developer. This is a very complex international and domestic issue in an area with severe geographic, meteorological, economic, traditional, and local constraints,” Godfrey said.
Webmaster's Comments: The Coast Guard's approval makes it clear that the developer cannot proceed until obtaining cooperation from the Government of Canada. Canada has made it clear that it will not provide that cooperation. Downeast LNG, Calais LNG, and the now-defunct Quoddy Bay LNG efforts are expensive and divisive exercises in futility.
The documents require Downeast to implement a number of risk mitigation measures, including developing "standard operating parameters approved by the USCG and coordinated with the Government of Canada to enable the safe and secure movement of LNG tankers through Canadian and U.S. waters."
[T]he WSR acknowledges that "a significant portion of the transit route" to Downeast is contained within Canadian waters and "[t]he eventual involvement and cooperation of Canada's maritime, environmental, and public safety authorities are paramount to ensure the safety and security of the waterway." [Red & bold emphasis added.]
Webmaster's Comments: The US Coast Guard acknowledges that Canada holds all the cards. Downeast LNG may as well fold up and go home.
Report U.S. Coast Guard says tankers can safely travel Head Harbour Passage to proposed plantDowneast president Dean Girdis said the solution to avoiding an international impasse will have to come from officials of both countries sitting down to talk as neighbours.
"Engagement — that's the solution," he said Thursday. "We believe there should be engagement between the U.S. and Canada on this issue. But I think it has to be clear that, at this time, there are no licences or permits that we need from Canada."
"I think Mr. Girdis has somewhat of a cavalier attitude. He isn't recognizing he's taking on a sovereign nation." [Red & bold emphasis added.]
Webmaster's Comments: Girdis is stymied by what he recognizes as an "international impasse." Then he tries to brush off the Coast Guard's requirements that clearly state Downeast LNG must obtain Canada's cooperation. Girdis has lost the battle.
Webmaster's Comments: Girdis is misleading and dishonest in his statement — the Coast Guard clearly states Downeast LNG needs permission from Canada.
Constructed at a cost of around US$1 billion, the LNG receiving and regasification terminal is located in Saint John, New Brunswick, and will be the first LNG regasification plant in Canada, sending out natural gas to both Canadian and U.S. markets. The facility will have send-out capacity of 1 Bcf/d (28 MMcm/d).
Webmaster's Comments: This project, alone, moots the three LNG terminal proposals in Passamaquoddy Bay.
FERC has placed on the agenda for its January 15, 2009 meeting three LNG proceedings: AES Sparrows Point LNG; Bradwood Landing LNG; and Dominion Cove Point LNG. Of particular note, the Commission will consider whether to approve or deny the AES Sparrows Point LNG project.
WASHINGTON -- Environmentalists on both coasts celebrated the resignation Wednesday of Federal Energy Regulatory Commission Chairman Joseph Kelliher who they clashed with for more than four years over plans to locate a LNG platform in Long Island Sound.
Citing "unanswered questions" regarding federally listed endangered and threatened species potentially affected by the proposed AES Sparrows Point LNG project, the U.S. Department of Interior (DOI) recommended that FERC withhold final certification of the project until the U.S. Fish and Wildlife Service addresses Endangered Species Act concerns.
WASHINGTON, D.C.: The U.S. Maritime Administration (MARAD) and U.S. Coast Guard will prepare an environmental impact statement (EIS) as part of the environmental review for Atlantic Sea Island Group's proposed Safe Harbor liquefied natural gas (LNG) deepwater port license application.
The Maritime Administration announced in the Federal Register today its intent to prepare an Environmental Impact Statement for the proposed Safe Harbor LNG deepwater port. Following the D.C. District Court's December 8, 2008, decision upholding MARAD's designation of New Jersey as an adjacent coastal state, both New York and New Jersey will participate in the project review and have veto authority over the terminal under the Deepwater Port Act.
"We need to reduce our dependency on the U. S. as the primary market for our natural gas and now is the time to begin planning, rather than waiting for the effects of the pipeline to force us into action.
The U.S. government's Energy Information Agency (EIA) on Tuesday said it expects natural gas to average $6.25 per million British thermal units(mmBTU) next year, down from about $9.17 for 2008. Prices have remained stubbornly low even with the start of the winter heating season. On Wednesday, NYMEX natural gas futures gained 11 cents to close at $5.69 per mmBTU. [Red emphasis added.]
Energy Summit Northwest attendees also heard Bill Walker of the Alaskan Gasline Port Authority describe the tremendous energy potential that exists if natural gas from Prudhoe Bay is brought by pipe to Valdez, Alaska, liquefied and shipped to re-gasification terminals on the West Coast. We learned that 8.3 billion cubic feet of natural gas per day could be available for use on the West Coast simply by linking Alaska with the other West Coast states through a supply chain based on LNG.
The chairman of the federal board that will approve or reject proposed gas developments in northwest Oregon announced his resignation Wednesday, ahead of the inauguration of President-elect Barack Obama.
Webmaster's Comments: The same effect is true regarding the LNG projects in Passamaquoddy Bay. Kelliher will no longer be FERC chairman.
The December 30th editorial titled, "Build the Palomar natural gas pipeline" attempts to rationalize the benefits of the "ambitious project" by offering cursory arguments of the project's "public benefits" without truly examining the impact of the pipeline.
"While any increase would likely be minor during the winter, the outlook for LNG imports next summer has materially increased. Nevertheless, we are only modeling imports up .5 Bcf/d on a year/year basis in 2009." [Red emphasis added.]
7 Jan 2009
The letter, issued by Capt. James B. McPherson, Captain of the Port for Coast Guard Sector Northern New England, states that if and when the risk mitigation measures are put into effect by Downeast LNG, they will sufficiently mitigate the identified risks associated with LNG traffic on the Passamaquoddy Bay Waterway. The waterway includes the waters of Head Harbor Passage, Western Passage and Passamaquoddy Bay.
Webmaster's Comments: The Waterway Suitability Report (WSR) is around 100-pages long including powerful obstacles against Downeast LNG's successfully meeting those conditions.Top
6 Jan 2009
“This alone would have a significant economic impact at the port of Bayside. The physical location of the project is such that it definitely will have an impact on our port. All the factors affecting the port of Bayside would be of a negative nature.” [Red emphasis added.]
While Passamaquoddy Bay has not been abandoned by American liquefied natural gas developers, a handful of proposed projects have had the legs kicked out from under them. The American Federal Energy Regulatory Commission has dismissed Quoddy Bay LNG’s permit applications to import LNG into a proposed terminal on the Maine shore of Passamaquoddy Bay while Downeast LNG remains active but has withdrawn its state permit application. Calais LNG continues to work through the process to win approval to bring the LNG industry to Washington County.