FERC approves five LNG projects; one faces dispute

By OGJ editors
HOUSTON, June 21 -- The US Federal Energy Regulatory Commission has approved five LNG projects expected to increase US LNG import capacity by at least 8.2 bcfd.

One of the approvals, for expansion of Dominion's Cove Point terminal in Cove Point, Md., faces opposition.

The other approved projects include:

-- BP America Production Co.'s Crown Landing terminal in Logan Township, NJ, including storage capacity of 9.2 bcf and an 11-mile pipeline. Baseload sendout capacity would be 1.2 bcfd.

-- Sempra Energy's terminal in Jefferson County, Tex., near Port Arthur, including six LNG storage tanks each with capacity of 5.6 bcf. The project would be built in two phases with ultimate sendout capacity of 3 bcfd. Port Arthur Pipeline might lay and operate a 70-mile, 36-in. pipeline from the terminal to a connection with Transcontinental Gas Pipeline Co.'s system in Beauregard Parish, La. FERC also authorized construction of a 3-mile intrastate line from the terminal to the Natural Gas Pipe Line system.

-- Expansion of Cheniere Energy Inc.'s Sabine Pass project under construction in Cameron Parish, La., including three additional 160,000 cu m storage tanks and related facilities and an increase in planned sendout capacity to 4 bcfd from 2.6 bcfd. The first phase of construction is to be complete in 2008 and the expansion in 2009.

-- Cheniere's Creole Trail terminal, also in Cameron Parish, La., including four storage tanks with a combined capacity of 13 bcf and send-out capacity of 3.3 bcfd. Also approved was construction of a 116.8-mile, 42-in. pipeline from the terminal through Cameron, Calcasieu, Beauregard, Jefferson Davis, Allen, and Acadia parishes.

Cove Point issues
The Cove Point expansion would increase sendout capacity to 1.8 bcfd from 1 bcfd and storage capacity to 14.6 bcf from 7.8 bcf. The work includes the addition of vaporizers, two pipelines, and two storage tanks.

Washington Gas Light Co. reported that it is considering an appeal to FERC's approval of the Cove Point LNG expansion, claiming that the Commission disregarded key facts that link gas from the Cove Point terminal to leaks in a portion of its gas distribution system.

Washington Gas said it began experiencing an increased number of leaks in a 100-sq-mile area of Prince George's County, Md., in late 2003, shortly after reactivation of the Cove Point terminal. It said independent analysis showed that a change in gas composition contributed to leaks in pipe couplings. The change in composition coincided with the introduction of gas from the Cove Point terminal, the company said.

Washington Gas is challenging FERC's conclusion that the company's use of hot tar as a method of corrosion protection and an increase in operating pressure "were the principal causative factors" for the increased leaks.

Washington Gas said, "The increase in leaks has only occurred in the area that consistently receives Cove Point gas as its sole source of supply." It added that its "operating pressure has remained constant in the affected area since the mid-1980s."

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