Atlantic LNGs Train IV tank under
By Daniel W Reilly
The United States House of Representatives passed a controversial
Energy Bill last week which included some key provisions
that give the Federal Government control over the construction
and placement of LNG terminals.
If the bill passes the US Senate, it could be a major
boost for T&Ts export of LNG to the US as it would
clear the way for the construction of terminals along the
East and Gulf coasts of the US.
While there is near consensus among US Government officials
on the need to import more natural gas, especially in the
face of rising fuel costs, overcoming local and State objections
to the siting of LNG terminals in specific communities has
proven to be a daunting task.
The LNG provisions of the current Energy Bill would give
the Federal Energy Regulatory Commission (FERC) unprecedented
jurisdiction over the location and construction of LNG terminals,
requiring the FERC only to consult with the
State in which the terminal is located and stating that
the Commission shall establish a schedule for
all Federal and State LNG proceedings.
However, even with the US Government streamlining the
process and the obstacle of local and state objections seemingly
overcome, there is no guarantee that the terminals will
be built and accepting imports anytime soon.
Gerald Karey, Washington Bureau Chief of OilGram News
and a keen observer of the Energy Bill, told the Business
Guardian that the while the provision would help streamline
the process, there was no specific language in the bill
stating timelines for construction of terminals or for increasing
future capacity or imports.
Karey also predicted the debate over the construction
of the terminals would shift to a different arena.
I dont doubt that this battle will be fought
in the courts, he said. A lawsuit has already been
filed in California, accusing the FERC of impeding states
Opponents of the measure have long argued that it cedes
too much control to the federal government and that it would
put unsafe LNG terminals near major population centers.
What we are against is the steamrolling over local
and state concerns, said Emily Kaplan of the United
States Public Research Group, a public interest advocacy
group that often focuses on environmental issues.
USPIRG is just one of the many environmental and community
groups that have spoken out against the provision.
We are not against (LNG terminals)... we think that
the best places for them are away from major population
However, in a statement released on April 14, USPIRG said,
LNG storage and transportation is a business with
a history of accidents and that the provision would
prevent states and local communities from making important
decisions regarding dangerous LNG facilities.
Of the 55 proposed LNG terminals around the country, several
are located near major cities, such as Los Angeles and Boston.
The 1,000 page Energy Bill included everything from such
germane measures as extending daily-light savings time an
extra two months to save electricity costs, to widely controversial
provisions such as opening up Alaskas Arctic National
Wildlife Refuge (ANWAR) to oil drilling.
In addition to the LNG provisions, the bill also provides
over US$8 billion in tax breaks to energy companies as well
as a provision that would protect producers of the gasoline
additive MTBE from lawsuits stemming from cases of groundwater
With so many controversial amendments and a major fight
brewing over the MTBE and ANWAR provisions, the bill now
heads to the US Senate where it faces an uncertain future.
While rising gas prices within the US have led to calls
from President Bush and other lawmakers to pass the Energy
Bill as soon as possible, critics remain skeptical that
the bill will have any immediate impact on either fuel prices
or energy supplies.
The fate of the bill, as well as the fate of future LNG
imports to the US, remains unclear.