AES Corp. has appealed to the U.S. secretary of commerce to override Maryland's objection to the federal consistency certification for the company's Sparrows Point liquefied natural gas (LNG) terminal project in Baltimore, MD.

In addition, the Weaver's Cove Energy LLC has a similar appeal pending. It has asked the Commerce Department to override Massachusetts' objection to the federal consistency certification for its controversial LNG terminal project in Fall River, MA.

The secretary can override a state's objection if he determines that an LNG project is consistent with the objectives of the Coastal Zone Management Act (CZMA) or it is necessary in the interest of national security.

Maryland's objection "failed to specify a single 'enforceable policy' of the [state's Coastal Zone Management Program, CZMP] as a basis for its objection, which is the minimum required by the CZMA regulations," AES said in its initial brief on appeal to the department. Moreover, it said "the project's contribution to national security independently warrants an override of [Maryland's] objection."

Weaver's Cove made similar arguments. Massachusetts' "objection on the ground of insufficient information was not a valid objection under the [CZMA] act and regulations," it said. "The [state] may only object to Weaver's Cove's consistency certification on the basis of insufficient information if Weaver's Cove failed to 'supply the information required'...following a written request for the information." This was not done, the company said. Moreover, the company argued that the Weaver's Cove project "furthers the national interest in a significant and substantial manner."

Because AES refused the state of Maryland's request to stay the federal consistency review of its proposed Sparrows Point LNG terminal, the Maryland Department of the Environment (MDE) in mid-July denied the developer's request for a finding that the project is consistent with the state's coastal zone program (see NGI, July 23).

"MDE asked AES to stay the federal consistency review period to give MDE the time to receive and consider the information necessary to carry out a comprehensive review of the project and its consistency with Maryland's networked CZMP. AES's refusal to agree to a stay leaves MDE with no choice but to object to the AES certification," the state regulatory agency said in its July letter to AES.

This was just one more obstacle in the company's path to construct the terminal on a peninsula that juts out into Chesapeake Bay in the city of Baltimore. AES also is battling in state and federal courts to overturn a Baltimore County ordinance that bans the construction of LNG facilities along its part of the Chesapeake Bay (see NGI, July 9, July 16). AES contends that the county's zoning ordinance violates the Energy Policy Act of 2005's amendments to the Natural Gas Act, which give the Federal Energy Regulatory Commission sole jurisdiction over the siting of LNG facilities.

If built, the Sparrows Point project would have about 1.5 Bcf/d of regasification capacity with a potential for expansion to 2.25 Bcf/d. Regasified LNG would be delivered to regional markets via the proposed Mid-Atlantic Express, an 87-mile, 30-inch diameter pipeline that would extend from the terminal to connections with interstate pipelines at Eagle, PA.

As for Weaver's Cove, Massachusetts informed the company in early July that it objected to the certification of the LNG terminal project's consistency with the state's coastal zone management program. This was just the latest in a series of bad news for the embattled project this summer.

In May, the U.S. Coast Guard delivered a blow to Weaver's Cove, saying its proposal to use smaller LNG tankers was incompatible with the waterway near the proposed site in Fall River (see NGI, May 21). "It appears that the waterway may not be suitable for the type and frequency of LNG marine traffic contained in your smaller tanker proposal," said Roy A. Nash, captain of the Port of Southeastern New England, in a preliminary review of the company's tanker proposal.

Sponsors of Weaver's Cove proposed using smaller LNG tankers after language was inserted in a transportation spending bill, which was later signed by President Bush, that blocked the demolition of the Brightman Street Bridge over the Taunton River (see NGI, Feb. 20, 2006). The old bridge, which would not accommodate the passage of large LNG tankers, was originally scheduled to be removed upon completion of the new Brightman Street Bridge.

The Massachusetts Department of Environmental Protection (DEP) then in June suspended its review of the proposed terminal following the unfavorable decision by the Coast Guard that it said "casts serious doubt as to the feasibility of the project."

The DEP is withholding action on the Weaver's Cove project until it receives a final determination from the Coast Guard that the project can move forward, said a DEP spokesman (see NGI, June 11).

The Weaver's Cove LNG terminal project, which FERC approved in mid-2005, has been the target of intense opposition by local, state and federal officials. If built, it would provide 800 MMcf/d of peak sendout capacity, 400 MMcf/d of baseload supply and 200,000 metric tons of LNG storage. The project would take up 68 of 73 acres at a former petroleum import terminal on the Taunton River, which feeds into Mount Hope Bay and Narragansett Bay about 50 miles south of Boston. Mill River Pipeline LLC would build two short pipelines to the Algonquin Gas Transmission system from the terminal to carry 400,000 Dth/d on average.

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