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AES Plans LNG Alternative to Fall River, Distrigas, Offshore Projects

Arlington, VA-based AES Corp. has announced a plan to build a $500 million liquefied natural gas (LNG) import terminal on an uninhabited island in Boston Harbor, promoting it as a safer alternative to the existing Distrigas terminal and the proposed terminal in Fall River, MA, which was approved by the Federal Energy Regulatory Commission in late June.

AES said the site, which is an unused state park on Outer Brewster Island, would be far away from residents and would have more room than Distrigas at Everett, MA, for LNG storage. It also said the terminal would not have the problems associated with water discharge and impact on fisheries that the two proposed LNG terminals offshore Gloucester have. Tractebel and Excelerate have planned offshore LNG import buoys about 50 miles northeast of Boston Harbor in the Atlantic.

The AES proposal drew a positive reaction from James W. Hunt, the chief of energy and the environment for the city of Boston, according to the Boston Herald. Hunt said the proposal is worth considering because of the concerns about LNG cargo ships entering Boston Harbor.

Under the AES project, tankers would remain out of the harbor while delivering their cargo.

However, the proposal apparently would require approval of two-thirds of the state legislature because the island is currently under the control of the state Department of Conservation and Recreation. It also would require an open bidding process for the land. The state is expected to receive $10 million annually in lease payments from AES, while Boston would receive $5 million/year in taxes.

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