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Gulfstream Protests Port Dolphin's Onshore Pipe Project

Florida pipeline Gulfstream Natural Gas System has filed a protest at FERC against Port Dolphin Energy LLC's proposal to build a small onshore pipeline as part of its deepwater liquefied natural gas (LNG) port project.

The project calls for Port Dolphin, the U.S. subsidiary of Norwegian company Hoegh LNG AS, to build a deepwater LNG port approximately 28 miles offshore Tampa Bay, FL. The port will make use of Shuttle and Regasification Vessels (SRV), which would regasify the LNG prior to its being transported by a 47.2-mile subsea pipeline to the shore of Port Manatee on Tampa Bay. Once it makes landfall, Port Dolphin's proposed pipeline would continue an additional 3.93 miles over land to an interconnect with Gulfstream at a point in Manatee County [CP07-191]. The project would have a peak delivery capacity of 1.2 Bcf/d (see Daily GPI, April 4, 2007).

Port Dolphin's proposed route for the onshore pipeline, which would parallel the existing rights-of-way of Gulfstream in Port Manatee, is "very problematic" due to the density of new and existing buildings in the area, Gulfstream told FERC in its initial filing last May. As a result of the restricted space, Port Dolphin's proposed route poses a "potentially serious risk" to the safe and reliable operation of Gulfstream's system while construction is under way for Port Dolphin's pipeline, it said.

Gulfstream believes that an offshore subsea interconnection to its pipeline would be "far more preferanble" than an onshore interconnection.

Port Dolphin recently submitted to the U.S. Coast Guard an amendment to its deepwater port application. However, Gulstream said it has not yet seen the "entirety of the amendment," and thus does not know whether it serves to "reduce or exacerbate Gulfstream's concerns."

Hoegh LNG said it has developed the SRV concept since 2001 and has two vessels on order for delivery in 2009 and 2010 to serve SUEZ LNG Trading and the Neptune deepwater port projects, competing offshore LNG terminal projects in Massachusetts. The Maritime Administration approved deepwater port licenses for the two Massachusetts projects last year.

The Port Dolphin Energy deepwater port is not the only project proposed for the Florida market. SUEZ Energy North America's subsidiary, Calypso LNG LLC, is seeking the approval of federal regulators to build an LNG port off the southeastern coast of Florida.

The Calypso deepwater port is proposed to be located approximately 10 miles offshore from Port Everglades, FL and would comprise a marine offloading buoy and anchoring system that will reside approximately 150 feet below the ocean surface when not in use. The port would connect to an undersea pipeline proposed by another SUEZ subsidiary, Calypso U.S. Pipeline LLC, which would have the capacity to transport approximately 800 MMcf/d of natural gas to customers in Florida (see Daily GPI, Nov. 2, 2006).

Hoegh is a pioneer in the LNG shipping industry and currently operates a fleet of six conventional LNG tankers. It said it has spent the past five years focused on developing and promoting floating LNG regasification terminals, such as the SRV system.

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