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FERC backs Long Island Sound LNG Draft report says terminal would have minimal environmental effect, natural gas critical for states to meet air quality targets Petroleum News
A liquefied natural gas terminal proposed for Long Island Sound between Connecticut and New York would have minimal effects on the environment, federal regulators said in a preliminary report Nov. 17.
The draft report by the Federal Energy Regulatory Commission sparked immediate criticism from opponents of the project, including Connecticut Attorney General Richard Blumenthal, Connecticut Sen. Joe Lieberman and the Connecticut Fund for the Environment.
Opponents said they would submit written comments and appear at public meetings scheduled for January to challenge the report on Broadwater Energy’s proposal. Blumenthal said he was prepared to take the issue to court if necessary.
Executives at Broadwater Energy, a consortium of Shell and TransCanada Corp., said the draft report was a significant breakthrough for the project.
“It’s a key milestone,” said Broadwater senior vice president and project director, John Hritcko, whose company still needs environmental approvals from New York State. “It confirms what we’ve been saying all along.”
The draft report by Federal Energy Regulatory Commission staff recommends approval of the floating terminal, proposed for New York waters about 9 miles from Long Island and 11 miles from the Connecticut shore. The terminal would be about 1,200 feet long and 200 feet wide, with an 82-foot-high upper deck. Plans call for it to be completed by mid-2010.
The terminal would supply 1 billion cubic feet of natural gas a day, enough to heat 4 million homes a year, which would be fed through an underwater pipeline into an existing pipeline network that serves New York City, Long Island and Connecticut.
The report says the facility would have only minor effects on the environment and public safety, and would be key to meeting the region’s natural gas needs.
Extra security precautions would be taken The U.S. Coast Guard in September said the terminal posed safety and security risks that would require more firefighters, escort boats and other measures to prevent accidents or terrorist attacks, but it raised no objection to construction.
If the project is approved, FERC said, the Coast Guard would set up safety and security zones around the terminal. The company also has said it would provide staff and equipment to handle emergencies.
FERC said the regional market gets 85 percent of its natural gas supply from the Gulf of Mexico and Canada, areas where production is projected to fall over the next 20 years. With natural gas consumption increasing, LNG imports from overseas would provide needed diversification to currently available natural gas, but FERC also said use of natural gas, rather than coal or oil, to produce electricity is critical for the states of New York and Connecticut to meet their air quality targets.
In an interview with The Globe and Mail following the release of the draft report, Hritcko said the project has not yet identified a source of natural gas supply: “That (sourcing) will be the purview of the Shell portion,” he told the Toronto-based newspaper. “Shell is one of the largest LNG players in the world, and has a full portfolio of potential locations.”
The partnership between Calgary-based TransCanada and the Anglo-Dutch company will be looking for long-term deals rather than spot markets for LNG, Hritcko said.
—The Associated Press contributed to this report
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