NGI The Weekly Gas Market Report / NGI All News Access

Maine LNG Project Starts Pre-Filing Process at FERC

After numerous attempts at siting a liquefied natural gas (LNG) project in Maine failed to get off the ground, Oklahoma-based Quoddy Bay LLC finally initiated the environmental pre-filing process at FERC last week on a proposed $500 million import terminal, which would be located on the Pleasant Point Reservation of the Passamaquoddy Indian Tribe.

"This facility will have the capacity to reliably supply up to 2 Bcf of natural gas a day to the region, which will effectively moderate energy prices in New England, while improving the local economy for decades," said Quoddy Bay LLC President Donald M. Smith, who also is CEO of Oklahoma City-based Smith Cogeneration.

While reaching the regulatory stage is a significant achievement, the project still faces a challenging uphill battle. It already was rejected once by residents of the town of Perry in Washington County, who voted last year to oppose the first project site on Gleason Cove despite the developer's offer of $1 million per year to the town (see NGI, April 4). Now Quoddy Bay LLC has relocated the terminal farther south but still is planning to site its storage tanks in the town of Perry.

It is offering to pay 85% of Perry's tax revenues plus a $1 million economic development package. The Passamaquoddy Tribe, which would host the facility, would receive lease payments of up to $12 million a year.

Since going through several transformations, the project now consists of four main components: an LNG import and regasification facility on a two-berth pier and platform on Passamaquoddy Bay; an onshore support facility with a metering station and power plant on the Pleasant Point peninsula; an onshore storage and regasification facility about one-mile away across Cobscook Bay; and a 40 miles natural gas pipeline that will connected the onshore storage and regas facility with the Maritimes & Northeast mainline. The onshore storage and regas facility will include three 160,000 cubic meter storage tanks on 170 acres.

"The [storage] tanks will hold about 10 Bcf of natural gas, or about five days of backup supply at maximum capacity," said Brian Smith, project manager. "The design allos for up to 2 Bcf/d of regasification at either the pier of the storage tanks. If we need to shut down our storage facility for maintenance, we can maintain our supply commitments by unloading directly from ships into regasifiers on the pier."

Quoddy Bay said it is seeking to begin construction in 2007 and be in operation in 2010. The company said the project will create 500 jobs during construction and 70 full-time jobs after it is completed.

"We're thrilled to initiate the structured, transparent, federal permitting process to bring this significant development to Maine," said Smith.

Two other developers have also expressed interest in building LNG terminals on Passamaquoddy Bay (see NGI, July 18, Oct. 3). Maine-based Calais LNG hopes to build a terminal in Calais with a capacity of 1 Bcf/d. And Downeast LNG of Washington, D.C., said it hopes to build a terminal with half that capacity in Robbinston, ME, 30 miles north of the Split Rock site.

©Copyright 2005 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

ISSN © 2577-9877 | ISSN © 1532-1266
Comments powered by Disqus