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Inquiries, Nimby-ism Follow Deadly Plant Blast

An explosion Feb. 7 at a natural gas-fired power plant under construction in Middletown, CT, which killed five workers and injured more than a dozen, has drawn attention to gas pipeline practices and prompted one lawmaker to lash out at a proposed pipeline that would run through New Jersey.

The blast, which happened about 11:15 a.m. at the Kleen Energy Systems LLC power plant project, is thought to have occurred while natural gas lines were being purged in a procedure commonly referred to as "blow down."

Connecticut Gov. M. Jodi Rell said she is assembling a panel of state agencies to identify the cause of the explosion and is forming a second group of state agencies, local officials and experts to review the findings of the panel and other investigations. The second panel will determine whether any changes should be made to Connecticut laws, state and local regulations or building and fire codes to protect both workers and residents living in the areas surrounding construction projects, her office said.

"There are so many unanswered questions: What led to this disaster? What were the contributing factors? Could anything have been done to prevent it? These are the questions that we must answer now, not only for the sake of the victims and their families but to avoid tragedies like this in the future.

"Our response to the Middletown explosion must follow two distinct but critical paths. We must first identify what went wrong and then determine every measure we can take to prevent future catastrophes. The reviews must be thorough, impartial and swift. And if there are concrete steps we can take in the meantime, we must be equally swift in putting those new measures into place."

In light of the accident, Sen. Frank R. Lautenberg (D-NJ) has raised concerns about a Texas Eastern Transmission (Tetco) proposed pipeline expansion that he says would be built through New Jersey to primarily benefit New York.

"The explosion raises a red flag about the construction of a natural gas line that would run through New Jersey primarily for the benefit of New York. This risky project should not be permitted so close to New Jersey's chemical plants, Newark Liberty Airport and the area that terrorism experts call the most dangerous two miles in America," Lautenberg said.

"New Jersey should not bear the safety risk of a project that primarily benefits New York," he said. New Jersey has not exactly rolled out the welcome mat for gas pipeline projects since 1994, when a massive explosion on a Tetco mainline in the state leveled a large apartment complex.

While Lautenberg contends that New York will be the main beneficiary of the Tetco pipeline, Spectra Energy and the project's anchor shippers -- including Chesapeake Energy Corp. -- have pointed out that New Jersey will experience enhanced service as well. "This project aligns with our strategy to develop and construct right-sized, well timed expansion projects for our customers in the Northeast and further extends our ability to serve these key customers in New Jersey and New York, including Manhattan," said Spectra CEO Greg Ebel at the time the pipeline expansion was announced in late 2009.

Lautenberg said he plans to meet with Spectra Energy, parent of Tetco, and federal officials to "raise my concerns about protecting Hudson County families and keeping New Jersey safe."

Spectra Energy spokeswoman Toni Beck said the company was already in the process of contacting the senator. "Obviously we'll continue reaching out to him to understand his issues. We'll certainly going to have those conversations with him," she said. The project calls for Tetco to build a 16-mile, 30-inch diameter extension from Tetco's pipeline in Staten Island, NY, through Bayonne and Jersey City in New Jersey to a Consolidated Edison plant in Manhattan, as well as expand Spectra's Algonquin Gas Transmission system.

Just days before the explosion the U.S. Chemical Safety Board (CSB) had issued recommendations that national codes be changed to improve safety when gas pipes are being purged.

The CSB's "urgent recommendations" resulted from its ongoing federal investigation into the June 9 natural gas explosion at the ConAgra Slim Jim plant in Garner, NC, which caused four deaths and sent 67 people to the hospital. The CSB issued a safety bulletin on gas purging in October. Practices described in the bulletin include purging gases to a safe location away from ignition sources, evacuating nonessential workers during purging and using combustible gas monitors to detect hazardous gas accumulations. The CSB does not issue citations or fines but does make safety recommendations to plants, industry organizations, labor groups and regulatory agencies.

The catastrophe in Connecticut is not expected to affect power supplies in the region, even though the 620 MW plant was nearly complete, ISO New England said. The ISO said its long-term plans did not anticipate that the plant would be available until 2011. "The ISO is currently assessing future implications should these resources not come online as planned," it said. "The region has surplus capacity that can be available in mid-2011 if needed." ISO New England said its region currently has about 32,000 MW of capacity available, with 7,500 MW of that located in Connecticut.

However, the blast cast a pall over the outlook of developer Kleen Energy, according to Fitch Ratings. Fitch placed $730 million of Kleen Energy term loans on watch with negative implications based on the potential for heightened completion risks following the explosion. Construction of the facility had been proceeding within budget and on schedule, with the sponsor estimating a completion date of June 1, Fitch said.

"Fitch believes the accident may prevent Kleen from achieving the sponsor's originally projected completion date, and the length of the delay cannot be estimated at this time," the ratings agency said. "The force majeure provisions of the tolling and capacity purchase agreements provide for the suspension of liquidated damages and the extension of contract termination dates, though it is uncertain whether force majeure provisions will adequately mitigate Kleen's potential exposure to construction delays."

Long-term contracts for the plant and others in the state were approved by regulators in 2007. The site is about 20 miles south of Hartford.

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