The Canadian-based backer of the proposed Jordan Cove liquefied natural gas (LNG) export terminal and Pacific Connector transmission pipeline tying it to the western gas grid said on Friday that FERC has delayed until June the date for completing the project’s draft environmental impact statement (DEIS). In an environment of depressed global oil prices the delay may prove to be even more problematic.

Veresen and the Jordan Cove project officials are downplaying the significance of either at this point. In fact, a Canada-based executive told NGI on Friday that the project sponsors are still expecting to have some binding agreements with two to four customers to announce this year to replace the nonbinding agreements now in place (see Daily GPI, Oct. 11, 2013).

The Calgary, Alberta-based project sponsors anticipated that the original schedule calling for a Feb. 27 release of the DEIS from the Federal Energy Regulatory Commission “was under pressure,” according to Veresen CEO Don Althoff. He said the move is not a surprise or a concern at this point.

“While we are disappointed in the revised [FERC DEIS] schedule, we are not surprised or concerned, and we look forward to receiving our final EIS in June,” Althoff said.

With the decline in oil prices and an array of competitors lined up in Western Canada seeking to market British Columbia’s abundant, albeit remote, shale gas, Jordan Cove and a second Oregon LNG export project last fall pushed forward on all fronts — permitting and lining up customers for their proposed export terminals (see Daily GPI, Nov. 4, 2014).

A coastal project at Coos Bay along Oregon’s south-central coast, the 1.2 Bcf/d Jordan Cove project is slated to be a tolling facility with prices linked to Henry Hub, not global oil. It includes a 1 Bcf/d transmission pipeline, Pacific Connector, as well as an adjacent gas-fired generation plant. Last November, Project Manager Bob Braddock told NGI that he expected FERC’s DEIS “within the next few days.” That was before Thanksgiving and turned out to be wrong.

More recently, NGI asked Braddock about the impact of the oil price decline on the project’s development, and he was unconcerned, adding that FERC had not requested any new information as a result of the steep price drop, and Jordan Cove’s prospective customers are not raising the issue.

“In my opinion, the utilities we are seeking as customers have very long time horizons, and short-term price swings are part of the long-term economic environment they must deal with,” Braddock said. “If you believe that current prices for oil will last for the next third of a century, it might impact our customers’ thinking.”

A financial executive with Veresen reiterated the same arguments late last Friday. “Our potential buyers take a long-term view of the world, and they would be buying gas five years from now and for a 20-year period,” she said, adding that it is unlikely crude oil will be staying at current price levels for a long time.

“They also like a diversity of supply sources, and they like North America and the fact that Jordan Cove is on the West Coast and not the Gulf of Mexico, and we are in some detailed discussions with customers as we speak.”

Veresen has set a target of inking at least one potential offtake customer in the first quarter, said the executive, adding that it could be between two and four customers and for volumes of gas that total about a quarter of the proposed Jordan Cove throughput capacity. She also said the initial deals are expected to be with large Asian utilities.