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NorthernStar, Crystal Energy Merge Offshore CA LNG Efforts

As the federal energy department hosting a third in a series of public education sessions on liquefied natural gas (LNG) in Los Angeles Thursday, the sponsor of the proposed Clearwater Port offshore LNG terminal project on the Southern California coast announced it now has "significant competitive advantages" from its merger into NorthernStar Natural Gas, Inc. and is prepared to go forward.

Former Crystal Energy senior executive and now NorthernStar President Paul Soanes said NorthernStar's involvement now gives the Clearwater proposal to convert an existing idle oil platform 12.6 miles offshore Ventura County west of Los Angeles "the resources and expertise to build and operate a safe, environmentally sound clean energy terminal that Ventura County and California need."

NorthernStar is a U.S.-owned and managed privately held company that was created specifically to site LNG facilities. The company announced last month it completed initial financing to pursue separate LNG terminals in Oregon and offshore California. Net proceeds of its $100 million convertible notes sale will be used to start both the Columbia River and Clearwater Port LNG projects, the company announced May 23.

"We're transforming an existing oil platform into a safe, state-of-the-art import terminal for clean natural gas -- instead of building another large structure off the coast -- so Clearwater Port can preserve the California coastal experience and more quickly begin serving California's energy needs," said Soanes, in a prepared announcement made out of Oxnard, CA.

With NorthernStar's financing and expertise, Clearwater Port's backers are now touting its construction timeline as being "shorter than other proposals" because they say that in part it will not require any on-site storage facilities. "Clearwater will immediately return LNG to its gaseous state, and then use undersea pipelines along Platform Grace's existing [to-the-shore] corridors to transport the supplies into Southern California Gas Co.'s existing underground transmission backbone pipeline system," Soanes said.

Last March, Houston-based Crystal Energy, LLC, and its wholly owned subsidiary, Clearwater Port, contributed their ownership to NorthernStar, and Soanes and Si Garrett became president and chief executive, respectively of NorthernStar Natural Gas.

Clearwater Port officials said the company, under NorthernStar, is now finalizing "enhancements to the project" as it prepares to file an updated application with the U.S. Coast Guard and California State Lands Commission. It expects to make that filing later this month.

"Clearwater Port will meet or exceed all federal, state and local safety and environmental requirements," said Garrett, a retired U.S. Navy nuclear submarine fleet captain.

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