2007-10-11 / News

Grid drops upstate plans for LNG terminal

By Dotti Farrington

National Grid announced last week that it is dropping its plans for a court battle over using the KeySpan site in Providence for a liquefied natural gas (LNG) marine terminal. The company said it would continue looking for appropriate sources of LNG to serve its customers in Rhode Island and elsewhere.

Meanwhile, Weavers Cove/ Hess in Falls River, Mass., is continuing to push for permits to build its LNG marine terminal there. Its latest efforts involve fighting sanctions by the Massachusetts Coastal Zone Management and the National Park Service of the US Department of the Interior.

Residents and officials in Jamestown and elsewhere along the Narragansett Bay shoreline have been opposing the KeySpan and Weavers Cove plans for any facility that would bring supersized tankers into bay waters. Opponents fear catastrophic LNG fires and various environmental impacts.

National Grid role

National Grid, in August, completed purchase of the KeySpan property as part of major acquisitions of energy-related companies. Company officials said, "it is much too soon" to say specifically how the acquisitions might be used or changed to pursue goals to provide energy in Rhode Island and its other locations.

Rhode Island Attorney General Patrick Lynch and State Rep. Bruce Long (R-Jamestown, Middletown) last month each asked National Grid to not pursue the court appeal started by the previous owner of KeySpan. That appeal was to fight the Federal Energy Regulatory Commission (FERC) rejection in 2005, upheld in 2006, of plans for the LNG terminal in Providence. The court debate in Washington, DC would have started Oct. 26 if National Grid did not abort it.

Lynch hailed the National Grid decision and its implications for public safety.

According to Lynch, National Grid officials said need for a Providence LNG operation is lessened by developments for a new LNG marine terminal, off the coast of Gloucester, Mass., due to be opened soon.

Grid spokesman David Graves said the company does not have any particular options in the works for use of the KeySpan property. He clarified that his company has no involvement, or direct dependence, on plans for terminals elsewhere.

"The company believes LNG will continue to play a critical role in both energy reliability and price," National Grid specified in a statement it issued last week. "It is our responsibility to make sure energy needs are met, and we believe LNG is an important part of providing that energy," Graves elaborated.

Several public officials praised the National Grid announcement and said it reflected the company's reputation of community mindedness for the customers it serves. Opponents here and elsewhere over the years have said they believe that LNG can have a safe role in providing energy, but that giant tankers coming inland along water routes were too dangerous.

Weavers Cove actions

The US Coast Guard decision on the Fall River LNG plans was expected by now, but they are still working on questions about the safety of tanker transits to a proposed terminal there. That operation was approved in 2005 by FERC if all issues could be resolved.

Two unions recently issued statements of support for the Weaver's Cove LNG terminal intended to serve southern New England.

The 1,300 member Local 51 of Plumbers, Pipefitters and Refrigeration workers, based in East Providence, and the Construction and General Laborers Local 610 in Fall River adopted resolutions that said the terminal would mean $500 million in investment to Fall River and generate about 500 construction jobs over a three-year period. About 100 of those jobs would be permanent, the unions said. They also said the project would result in "lower and more secure gas prices."

James Grasso, a Weaver's Cove executive, said he asked the unions for their support. He blamed opposition on "a lot of misinformation."

The National Park Service last month submitted its draft report and environmental assessment on the Taunton River under its Wild and Scenic River Program in response to a 2000 Congressional assignment. Its report could block the LNG terminal.

Weavers Cove responded almost immediately with hundreds of pages criticizing the report for its methods and findings, and arguing that it does not satisfy legal requirements, is factually incomplete and misleading, has major omissions, is invalid and inconsistent, and does not reflect a fair, accurate, serious or objective study of the river. Weavers Cove contended the report was designed specifically to block its LNG energy infrastructure project and "to further an anti-energy political agenda."

In documents criticizing the Coastal Management rulings against the terminal, the LNG operation defined itself as a national security interest that should not be blocked. "National defense or other national security interest would be significantly impaired were the activity (terminal) not permitted to go forward as proposed," according to Weavers Cove lawyers.

"Without new natural gas supplies, the consequences of a shortfall in pipeline capacity or supplies could be dire, setting often extended gas outage that would risk public safety in freezing temperatures. The Weaver's Cove Project could help meet demand and stabilize regional and national gas markets in the event of a major disruption to energy and is necessary in the interest of national security," the lawyers said in documents filed as an appeal before the US Department of Commerce on Coastal Management findings.

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