FERC approves US's first floating LNG terminal

March 24, 2008
The US Federal Energy Regulatory Commission has approved Broadwater Energy LLC's application to construct the first floating LNG terminal in the US.

Nick Snow
Washington Editor

WASHINGTON, DC, Mar. 24 -- The US Federal Energy Regulatory Commission has approved Broadwater Energy LLC's application to construct the first floating LNG terminal in the US.

Approval of the project in Long Island Sound after more than 3 years was subject to the operator's adopting more than 80 mitigation measures to enhance safety and security and minimize environmental impacts, FERC said in its Mar. 20 announcement of the decision.

FERC Chairman Joseph T. Kelliher said the commission carefully considered concerns expressed by many citizens about the project. Approval was based on all available scientific facts and was subject to rigorous conditions because the project can meet New York City, Long Island, and Connecticut's projected energy needs safely, securely, and with limited environmental impacts, he said.

John Hritcko, Broadwater senior vice-president, called the action "an important step forward in bringing new, clean, reliable natural gas supplies to a region where prices are volatile and climbing, air quality is a concern, and [which] is located at the end of the pipeline delivery system."

Broadwater is a joint venture of TransCanada Corp. and Shell US Gas & Power Co. The project aims to deliver up to 1.25 bcfd of regasified LNG to electric power plant and home heating customers. The project would be 9 miles off the coast of Riverhead, in Suffolk County, NY, and 10.2 miles from the nearest onshore point in Connecticut, FERC said.

It said the proposed project would include eight LNG storage tanks capable of storing the equivalent of 8 bcf of regasified LNG, a regasification plant, and a 21.7-mile long pipeline from the terminal to a subsea interconnection with the Iroquois Gas Transmission System which will bring the gas onshore.

Hundreds of comments
FERC said it received hundreds of public comments in response to the commission staff's environmental impact statements expressing concerns about public safety and security, possible impacts on Long Island Sound, and the need for the project. It noted that the draft EIS was 825 pages long and the final EIS ran more than 2,200 pages. The proceeding's total record contains more than 7,100 exhibits, and FERC's review took 38 months and 25,000 staff hours, it said.

In response to concerns that the project would industrialize Long Island Sound by establishing a new industrial precedent and stimulating new development, FERC found that 4,000-7,000 commercial vessels/year pass through the sound, as many as 2,000 of which transport oil and petroleum products. It found no basis for thinking project approval would stimulate new offshore industrial development.

It said the more than 80 mitigation measure in the project's final EIS include requirements for Broadwater to submit plans to the commission's energy projects office at least 60 days before construction detailing how FERC's order will be implemented.

Broadwater also is required to develop an emergency response plan as a condition of FERC's approval, and coordinate procedures with the US Coast Guard; state, county, and local emergency planning groups; fire departments; state and local law enforcement services; and appropriate federal agencies, FERC said.

The project's developers also will need to file documents with the state of New York for determination that the project is consistent with the state's coastal management plan under applicable provisions of the federal Coastal Zone Management Act.

Intervenors will have 30 days to petition for a rehearing, FERC said.

Contact Nick Snow at [email protected].