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Offshore CA LNG Project by Australian Firm Hits Regulatory Delay

Offshore CA LNG Project by Australian Firm Hits Regulatory Delay

While no one is putting a time estimate on it, the Australian resources giant BHP Billiton faces some detailed data requests from federal and state officials trying to put together a final draft environmental assessment of Billiton's proposed liquefied natural gas (LNG) receiving terminal offshore Oxnard, CA. The government agencies stopped the regulatory clock on the Cabrillo Offshore LNG project during the first week of the New Year.

While the proponents downplayed it, U.S. Coast Guard and California State Lands Commission officials stopped the clock, noting that detailed -- and some would call it "basic" data -- operational, public safety and shipping information on the $550 million, 800 MMcf/d project must be compiled before the environmental review process can be resumed.

A Jan. 5 letter from the Coast Guard said considerably more information was needed from Billiton on at least six basic areas: (1) overall project description details, such as the foreign flags flying on the intended LNG ships, (2) Maritime traffic analyses, (3) air quality impacts from construction and operation, (4) terrestrial biology for the onshore infrastructure connecting the terminal to the existing Southern California Gas Co. transmission/distribution pipeline system, (5) marine biology, and (6) geology.

The latter alone asks for a "geotechnical report that addresses conditions at all horizontal directional drill (HDD) bore sites (both onshore and offshore) and at mooring system locations." Another section asks for completed winter field surveys of waterfowl and burrowing owls in the vicinities of all pipeline alternatives in Oxnard, meeting California state standards and protocols. Still another part asks for an application by Billiton to the U.S. Army Corps of Engineers.

With the Coast Guard letter's preliminary list of questions and areas needing to be addressed was the admonition that more detailed questions would come later.

"The list below represents a preliminary list consisting of the major items that need to be addressed prior to our restarting the regulatory clock for processing the license applications," wrote Mark Prescott and H. Keith Lesnick, from the Coast Guard Deepwater Ports Standards Division. "Once we have completed a detailed review of all comments received, we will provide you with a more detailed request that identifies additional items, questions, and/or clarifications for your action."

Nevertheless, a local community spokesperson for the Billiton project in Oxnard said last week that it was unclear whether the letter's data request will add weeks or months to the permitting process. "We're confident that consideration of the additional information requests will lead to a fuller understanding of the Cabrillo Port project's safety and value," said Kathi Hann, the local spokesperson for the project, who noted that the project sponsors haven't really assessed how much extra time will be required, noting that the agencies -- Coast Guard and State Lands Commission -- are the ones writing the environmental reports.

"We think it is good for them to take this extra time to consider all the comments (from a recent round of public input sessions), however long that takes," Hann said. "We will respond to the data requests as required."

How long does a "collision analysis for both LNG carriers and crew/support vessels, including the projected routes of outbound LNG carriers," take? Or the gathering of a list of "all offset sources that would be required for all air permits, including conformity, and an analysis of the feasibility of obtaining such offsets" and separately a "wetland delineation survey that comports with the definition of wetlands in the Coastal Zone Management Act an California Coiastal Act and that meets the requirements of both the California Department of Fish and Game and U.S. Army Corps of Engineers."?

Ultimately, the environmental reports both under the national and state requirements will look at the potential impacts on shipping traffic in the area, air quality, land/marine biology, geology, noise and water quality.

"Our requirement is to supply them with all the technical data that they request so they can complete their understanding and to address all of the comments that have come in from the public hearings," Hann said.

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