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Proposed Long Beach LNG Plans on Track, Mitsubishi Exec Says

Proposed Long Beach LNG Plans on Track, Mitsubishi Exec Says

Even with continued public scrutiny and competition from other projects, the 700 MMcf/d Long Beach LNG receiving terminal, proposed by Mitsubishi Corp. subsidiary Sound Energy Solutions (SES) and ConocoPhillips, is still on track for a joint federal-state draft environmental assessment by spring and a final assessment in September, SES's COO Tom Giles told NGI late Tuesday.

Mitsubishi's plans to bring LNG from Oman to the proposed Freeport LNG receiving terminal in Texas will not impact the large Japanese company's plans for the West Coast, Giles said. "That gas is going to come from the other side of the globe most likely because of distances. It is unlikely any Pacific Rim gas will go to the Gulf Coast" (see related story).

Similarly, he said the issues being raised by the U.S. Coast Guard and the California State Lands Commission regarding one of the two active proposals to site an offshore LNG terminal along the coast near Oxnard, CA, 60 miles northwest of Los Angeles, do not directly affect the FERC and Port of Long Beach's ongoing environmental assessment of the SES/ConocoPhillips' planned terminal in Long Beach Harbor.

"We have reviewed all of those issues, and certainly some of the same ones will be answered in our EIR/EIS process, but most of them are ones that are project-specific -- as I would expect most of our issues to be," said Giles. He noted that the Port of Long Beach is doing some safety studies and peer reviews, but "they said in the last few days that they don't expect that to change the EIR process."

Giles said he is still hopeful the project will be able to finish the permitting process this year. He acknowledged there is still a sufficient level of local concerns and opposition, and "SES is working very hard in the community to explain our project, including the environmental benefits (from use of some LNG in port vehicle fuels, etc.). We expect lots of public hearings, and we welcome them," he said.

Last fall, opposing environmental groups gathered for meetings in the coastal city, which is 25 miles southeast of Los Angeles. The Port of Long Beach separately moved forward with expanded environmental and safety assessments on SES's proposal for LNG receiving terminal in the harbor, one of the world's busiest.

A Long Beach port official overseeing the environmental and safety assessments said the opposition has not changed the port's determination to work through the review process, although the process is going to take longer than originally thought.

In the meantime, construction on the first West Coast LNG receiving terminal is expected to start later this month at Sempra Energy's Costa Azul site along North Baja California's Pacific Coast about 60 miles south of the international border. Giles said that it looks like this is going to be the first terminal, "but we're not as sure as all the prognosticators about how many projects there ultimately will be. This is all entrepreneurial investment -- no government investment -- so if people have LNG they want to sell and markets they want to open, we would expect those people to continue to do whatever they think is in their interests."

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