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Source: The Day

Commerce decision called fatal to LNG tanker plans


Posted: April 14, 2009
Originally Published: April 13, 2009

The federal Department of Commerce on Monday dealt a major defeat to Broadwater Energy's four-year-old plan to locate a liquefied natural gas terminal and processing plant in the middle of Long Island Sound, upholding New York state's earlier ruling disallowing the project because it would not comply with coastal projection laws. "For all practical purposes, it's over. They're dead," said Adrienne Esposito, executive director of the Citizens Campaign for the Environment, one of the groups that led the grassroots opposition in both Connecticut and Long Island.

Broadwater, a partnership of Shell and TransCanada, could still appeal the Commerce decision to federal court, but the attorneys general of both New York and Connecticut have vowed to fight it. In a statement, Broadwater said it is still reviewing the decision and has not yet decided whether it will appeal.

"We will review the specifics of the ruling before making a decision on next steps," John Hritcko, senior vice president and regional project director of Broadwater, said. "We believe the region will need additional natural gas to ensure a reliable supply of energy, help reduce price spikes and meet air quality and climate change goals."

The project was opposed by both governors, the congressional delegations of both states and many state legislators. Connecticut Gov. M. Jodi Rell and Attorney General Richard Blumenthal both issued statements praising the decision.

Broadwater had received approval in March 2008 from the Federal Energy Regulatory Commission for the project, but still needed to obtain authorization from New York state that the LNG terminal would comply with the Coastal Zone Management Act, a federal law enforced by the states.

New York decided a month after the FERC decision that the project failed to meet six of 13 criteria for meeting the coastal zone act. In June, Broadwater appealed to the commerce department, which oversees enforcement of the law through one of its agencies, the National Oceanic and Atmospheric Administration.

The terminal, which would store and process liquefied natural gas imported from overseas for energy markets chiefly in New York, was to be located in New York jurisdictional waters of the Sound roughly halfway between Riverhead on Long Island and Branford. The terminal would be 1,215 feet long and 200 feet wide, and supply 1 billion cubic feet of natural gas daily through a subsea pipeline.

In a news release announcing its ruling, Commerce said that "the project's adverse coastal impacts outweighed its national interest, in part because of its location in an undeveloped region of the Sound that would significantly impair its unique scenic and aesthetic character and would undermine decades of federal, state and local efforts to protect the region."