2007-11-01 / News

U.S. Coast Guard puts clamps on LNG project

By Dotti Farrington

The U.S. Coast Guard last week issued its final decision, awaited since May and widely hailed by officials in recent days, on a ruling against the Weaver's Cove/Hess plans to ship liquefied natural gas (LNG) in giant tankers to Fall River, Mass., using Narragansett Bay.

Weaver's Cove announced within a day that it will appeal the Coast Guard's ruling that its tanker plans would be too risky. Weaver's Cove questions facts used to reach the Coast Guard's conclusion.

The Coast Guard and others said the drawn-out battle over the liquefied natural gas terminal is all but over unless there are unexpected changes to the plan.

"The decision disregards critical facts in the record and introduces both new data and new concerns on which Weaver's Cove Energy was not provided an opportunity to comment," the company said in a statement. "The decision lacks the necessary factual support, and we intend to appeal."

The company has several levels of appeal it can pursue within the Coast Guard. It can appeal directly within 30 days. If the decision is not reversed, the appeal would be forwarded to the First Coast Guard District in Boston. The final appeal within the agency lies with the Coast Guard headquarters in Washington, D.C.

The ruling

Roy A. Nash, Captain of the Port for Southeastern New England, said the area of most concern is the waterway from Prudence Island to the proposed site in Fall River. That waterway, Nash wrote to the company, "is unsuitable from a navigational safety perspective for the type, size and frequency of LNG marine traffic associated with your proposal."

"After an exhaustive analysis of a considerable amount of information, I have concluded that such transits cannot be conducted safely on a routine, repeatable basis, and that the risk of a mishap in Mount Hope Bay, and particularly in the Taunton River in the vicinity of the two Brightman Street bridges, is unacceptably high," Nash stated. A chief concern is the limited maneuvering room between the old and new Brightman Street bridges.

The Federal Energy Regulatory Commission (FERC) is the lead agency for permitting construction of LNG facilities and approved the Weaver's Cove plans in 2005 and upheld the approval by a vote in 2006. The FERC votes were conditioned on approvals by other agencies, such as the Coast Guard's assessment.

Company officials argued the project is much needed to meet the region's growing energy demands.

Ruling applauded

Meanwhile, Rhode Island and Massachusetts officials, praising the Coast Guard's decision, asked Weaver's Cove to end its LNG plans for Fall River.

"The Coast Guard made the right decision," U.S. Sen. Jack Reed, D-R.I., stated. "The Weaver's Cove project posed too many risks and would have placed a tremendous burden on local law enforcement and taxpayers."

His remarks were echoed by Rhode Island and Massachusetts governors, attorney generals and federal and state legislators.

"We haven't gone through the document thoroughly," Weaver's Cove spokeswoman Marcia Mac- Clary said. "It will take us some time to review it. We are moving forward."

The Fall River decision came three weeks after an announcement by National Grid that it would not continue to appeal a decision by federal regulators that rejected the company's proposal to expand its LNG facility in Providence. The National Grid action ended a fouryear effort by KeySpan (acquired in August by National Grid) to revamp its existing storage facility in Providence for an LNG terminal.

"The Coast Guard's decision is good news in our efforts to stop this project and protect the environmental health of the Bay and the safety of thousands of Rhode Islanders," U.S. Sen. Sheldon Whitehouse said in a statement.

"I applaud the Coast Guard for taking all aspects of the proposal into consideration and ruling on the side of safety," U.S. Rep. Patrick Kennedy said.

"Our years of fighting the siting of LNG in a densely populated area have finally paid off," RI Attorney General Patrick Lynch said. He initiated the effort to get National Grid to review its LNG status.

"I'm very pleased that the U.S. Coast Guard today agreed with my assessment that transporting LNG through Rhode Island's waterways poses too many environmental and security risks to Narragansett Bay and to nearby residents," RI Governor Donald Carcieri said. "This is great news for Rhode Island and for everyone who treasures the Bay."

Fierce opposition in Massachusetts and Rhode Island, which borders the 26-mile route the tankers would have taken, argued a terrorist attack or accident would be devastating to residents in the densely populated area.

Rhode Island, in August, refused to allow the dredging in Mount Hope Bay needed for the tankers to pass through. Massachusetts Congressmen also fought for environmental protections for the site under the Wild and Scenic Rivers Act, while Weaver's Cove officials argued their heavily industrialized site was neither wild nor scenic.

First reports of the Weaver's Cove $250- to $350-million plans for Fall River surfaced in 2001 and opposition grew over the years. Officials in Jamestown and elsewhere worked on several fronts to block the effort because of fears about dangers and about economic impact on the marine economy in Narragansett Bay.

Capt. Nash listed several issues impacting the suitability of the waterway for LNG transits, including: proximity of the waterway to population concentrations; prolonged, frequent exposure of the region to safety and security risks during the tanker bay trips; and expected delays to marine and vehicular traffic associated with frequent LNG tanker trips.

Legal maneuvers

The U.S First Circuit Court of Appeals in Boston last week declined to act on a pending law suit by the state of Rhode Island, the Conservation Law Foundation and others who asked that FERC be forced to reconsider its approval of the project. The case was filed after Weaver's Cove developed its plan to use smaller tankers to transport LNG through the Taunton River.

The court said the LNG project already faces significant hurdles and is too preliminary for a court review. The court also said the suit would be filed anew if the LNG project goes forward, after the other hurdles might be resolved.

Legal sources said the suit would remain a priority as well as several administrative cases, until all possibilities for the project are eliminated.

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