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AGDC counters MSB site comments to FERC
Kristen Nelson Petroleum News
The Alaska Gasline Development Corp. responded Oct. 2 to comments the Matanuska-Susitna Borough made to the Federal Energy Regulatory Commission on AGDC’s environmental and engineering analysis of a site at Port MacKenzie which the borough identified in its January motion to intervene out-of-time.
The borough wants Port MacKenzie considered as an alternative to Nikiski for construction of the project’s liquefied natural gas facility.
AGDC said FERC requested data that would allow its staff to quantitatively compare the Port MacKenzie alternative site with AGDC’s proposed Nikiski site. FERC also requested documentation on recent consultations with the borough on the analysis.
AGDC said it provided the requested information July 13. AGDC said that when the borough commented on Sept. 14 it accused AGDC of providing “willfully misleading statements which reflect an inaccurate analysis of the options available at Port MacKenzie.”
The borough said it had had “virtually no consultation” with AGDC.
AGDC said the borough’s comments reflect “substantial consultation, including several meetings and exchanges of information,” and said the borough’s “incendiary accusations are baseless, entirely inappropriate and should be disregarded.”
AGDC argues good faith AGDC told FERC it “in good faith analyzed the Port MacKenzie site based on the information and recommendations provided to it by MSB” and the borough’s consultant.
“MSB’s proposed slight deviation in the location of one of the options analyzed by AGDC, identified by MSB at the eleventh hour, constitutes yet another moving target presented by MSB during these proceedings.”
AGDC said the borough’s latest proposal “does not materially change the results of the environmental and engineering analysis of alternatives performed by AGDC.”
Substantial consultation AGDC told FERC it met with the borough in person on four occasions between FERC’s Feb. 15 data request and AGDC’s July 13 response - in addition to exchanges of numerous emails and factual and technical information.
At an initial meeting in February AGDC said it noted areas of concern it had about Port MacKenzie and requested additional information and cited a letter in which the borough said it was pleased with the initial meeting and looked forward to further consultations.
There was a follow-up meeting in May at which the borough provided an update on Port MacKenzie activities and informed AGDC that Port MacKenzie “was close to finding funds to complete its $125 million Rail Spur Project, and timber sale shipments were picking up.”
AGDC then identified two potential sites at Port MacKenzie, Option 1 and Option 2, chosen to fit the LNG facility design.
AGDC said it presented the borough with those options at a June 7 meeting, and told the borough there were “significant environmental, cost and operational concerns” at both options.
In a June 8 letter, the borough took issue with concerns AGDC had expressed over waterway congestion and operational concerns but agreed that there were “significant and major concerns” with the options, AGDC told FERC.
Master plan for port AGDC said an issue of concern to it was other planned uses of Port MacKenzie, including the rail extension and timber contract.
At a June 19 meeting, AGDC said, the borough said the existing and planned port uses based on the master plan “could be altered or eliminated and AGDC should undertake its analysis based on a ‘clean slate’ without any consideration of other planned uses.”
AGDC said it then analyzed Option 1 based on the premise that existing and proposed facilities could be removed from that area.
In a July 3 letter, AGDC told FERC, the borough “criticized Options 1 and 2 and contended that these options were intended by AGDC to ensure that the Nikiski site is chosen as the least environmentally damaging location. For the first time, MSB discussed an ‘Option 3’ which it later describes in its Comments as the ‘Optimum Site’.”
AGDC said that its July 13 response to FERC data requests was based on analysis of Option 1 and 2 alternatives, “and its consultations with MSB and relevant agencies.” Option 1 was modified from the June 7 version to incorporate information the borough provided at the June 19 meeting, “as well as the ‘clean slate’ approach which assumed no other planned uses.”
AGDC said that in the borough’s August comments “it emphatically contends that its ‘Option 3’ or ‘Optimum Site’ is superior to the two options evaluated by AGDC. Moreover, MSB accuses AGDC of intentionally ignoring its preferred option and instead evaluating two options that it knew would maximize environmental impacts.”
AGDC told FERC that although the borough said it proposed its optimum site several times over several years, the borough “does not produce any evidence of having proposed this location prior to its letter dated July 3, 2018, which is four years after the pre-filing review of this project was initiated, seven months after it intervened in this case, and after the four meetings with AGDC.”
The option was alluded to early in June and depicted with more detail July 3, AGDC said.
“MSB’s identification of its Option 3, later self-proclaimed to be the ‘Optimum Site’, at this late date is a continuation of the moving target to which AGDC has had to respond with respect to MSB’s proposals,” AGDC told FERC.
Obstacle issue AGDC told FERC that in addition to being proposed late in the process, the borough ‘optimum site’ option “does not avoid any of the obstacles and negative impacts associated with Option 1, as described by AGDC in its response to Data Request No. 20,” and is “not materially different” than the Option 1 site evaluated by AGDC.
The ‘optimum site’ shifts Option 1 slightly north, AGDC said, but does not avoid most of the adverse impacts identified.
Some of the borough’s responses “border on frivolous,” AGDC said, citing the borough’s contention that to make up for the longer transit time to Port MacKenzie, compared to Nikiski, LNG carriers could go faster - AGDC told FERC an additional LNG carrier would be needed.
AGDC said it “in good faith consulted with MSB and evaluated the two best options within the Port, consistent with the recommendations made by MSB and its own consultant.”
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