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FERC OKs Expansion of Cove Point Pier over Protest

FERC last Thursday approved Dominion Cove Point LNG LP's proposal to upgrade and expand its offshore pier at its liquefied natural gas (LNG) terminal on the eastern shore of Maryland.

With the expanded pier, Cove Point said it would be able to accommodate the "next generation" LNG tankers that are much larger than what it can presently accommodate at its terminal. The subsidiary of Richmond, VA-based Dominion Resources currently is limited to accepting cargo of up to 148,000 cubic meters at a single time at its terminal pier near Lusby, MD. The pier expansion would bump up the cargo limit to 267,000 cubic meters of LNG.

"The project enhancements will provide greater flexibility for acquiring and scheduling LNG cargoes worldwide, and enable Cove Point to compete more effectively for LNG supplies and to deliver comparable quantities of LNG using fewer shipments," the company told the Federal Energy Regulatory Commission [CP09-60]. The estimated cost of the pier project is $51 million.

Washington Gas Light (WGL), a Washington, DC-based utility that has been routinely critical of Cove Point's expansions, protested the pier project, saying it would result in increased volumes of regasified gas from the terminal to its distribution system. FERC disagreed.

"We emphasize that the pier reinforcement project does not involve an increase in Cove Point's authorized amount of storage capacity, or the authorized amount of vaporized LNG that may be sent out from the terminal at any given time. These parameters are constrained by both Cove Point's tariff and the maximum operating capability of its approved storage and vaporization facilities," the FERC order said.

WGL and Cove Point have a history together. The utility has blamed regasified gas from Cove Point for aggravating leaks on its distribution system, and it fears that any expansion of Cove Point's facilities would lead to greater volumes to its system and potentially more leaks (see NGI, July 11, 2005).

In October 2008, prior to a major expansion at Cove Point going into operation, FERC issued an order on remand that limited the volumes of LNG associated with the expansion that could flow into WGL's system from Columbia Gas at its interconnection with the Cove Point Pipeline at the Loudoun, VA, delivery point (Columbia-Loudoun) to 530,000 Dth/d (see NGI, Oct. 13, 2008).

"Our approval of the pier reinforcement project will not affect that delivery limitation," FERC said in its latest order.

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