The last chapter in the saga of the aborted 2 Bcf Wells, ME, LNGproject has been filed at FERC. A settlement agreement submittedrecently allows LNG project developer Granite State GasTransmission to recover $8.3 million in predevelopment coststhrough Northern Utilities’ ratepayers over a seven-year period.

Northern was the project’s most vocal proponent and onlycustomer, but after four years of battling for the LNG storagefacility and vaporization plant and winning certificates from FERCand state regulators, the LDC shocked observers by changing itsmind and signing a supply deal with Distrigas of Massachusetts. Thedecision left its affiliate, Granite State, with an $11.6 millionbill, about 20% of the expected total project costs, which itimmediately requested be recovered through Northern’s rates.

That request was hotly debated at state regulatory commissionsand FERC, but a settlement finally was reached. Granite State,Northern, regulatory commissions in Maine and New Hampshire, publicadvocates in the two states, representatives of the citizens ofWells, ME, and others have signed the deal. The settlementagreement calls for Northern to recover the costs of the projectthrough monthly collections from retail sales and potentially gastransportation customers in both states beginning retroactively onNov. 1, 1999. It also allows Granite State to keep the landassociated with the proposed facility and retain any profits fromselling the property.

The settlement resolves all legal disputes at the state andfederal levels, including withdrawal of the appeal of FERC’scertificate order on the project. The appeal was filed by No TanksInc., a group representing Wells, ME, residents.

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