The Senate before leaving for the Christmas holiday last Wednesday confirmed FERC Chairman Joseph Kelliher and Commissioner Jon Wellinghoff for second terms on the Federal Energy Regulatory Commission, putting an end to a nail-biting wait for Kelliher whose nomination had been pending in the Senate since May.
The action came one day after the Senate Energy and Natural Resources Committee voted out the nomination of Wellinghoff, which some correctly believed would prompt the full Senate to act at the last minute on both his appointment and the stalled nomination of Kelliher, a Republican. The speculation was based on the fact that Wellinghoff is a Democrat and a "favorite pick" of Senate Majority Leader Harry Reid (D-NV).
At FERC's meeting last Thursday, Kelliher said he was "so elated by being confirmed." He acknowledged that he came down the aisle with Wellinghoff, but he wasn't sure who was the bride and who was the groom.
Kelliher said it was a "rare event" for an incumbent Commissioner to be reconfirmed by the Senate.
Wellinghoff, a former attorney from Nevada, was initially sworn in at FERC on July 31, 2006 to serve the remainder of the term of former Commissioner William Massey, which expires on June 30, 2008 (see NGI, July 17, 2006). His second term will end on June 30, 2013.
The Senate energy committee voted out Kelliher's nomination for a second term at FERC to the full Senate in late May (see NGI, May 28). His current term expired on June 30, but he had been allowed to continue to serve while awaiting Senate action on his nomination. Kelliher's second term will expire on June 30, 2012. He has been chairman of FERC since July 2005.
At his confirmation hearing last Tuesday, Wellinghoff told the Senate energy committee that he did not support a policy where FERC would pick the winners and losers of liquefied natural gas (LNG) terminal projects. "I'm very hesitant to propose to my fellow Commissioners a policy where FERC is picking people and markets" for LNG projects, he said.
Sen. Ron Wyden (D-OR), an outspoken member of the Senate energy panel, called on the Commission to review LNG import projects "comprehensively," in aggregate to determine which project would best serve the market. He said he wasn't looking to FERC to pick the winners and losers, but rather to "open the door to a fresh approach" for review of LNG projects.
Wyden told Wellinghoff that the agency "has to get away from this sort of blinders-on approach that just basically says, 'We'll permit all of these things [projects].'"
The senator noted that it was "absolutely bedlam" in his home state of Oregon, with at least five interrelated LNG projects vying to produce "far more gas than our region could possibly use" (see related story). Wellinghoff said that he and FERC's director of energy projects planned to go to Oregon in January to discuss the issue with state officials.
A few of the Oregon LNG projects include NorthernStar Natural Gas's Bradwood Landing LNG project along the Columbia River, the Jordan Cove Energy Project LP at Coos Bay along the Pacific Coast, and Oregon LNG's proposed terminal at the mouth of the Columbia River on the Oregon side. Oregon LNG is a unit of Leucadia National Corp.
"I think the markets will ultimately pick" the winning LNG projects in Oregon, Wellinghoff said during the confirmation hearing, which lasted less than an hour. The committee swiftly voted out his nomination to the full Senate last Tuesday.
In response to questioning by Sen. Lisa Murkowski (R-AK), Wellinghoff said the Commission expects to see more LNG terminals built "near load centers on the West Coast and East Coast." He noted that FERC currently has "quite a few [LNG projects] in the pipeline," at least 10-12, and he expects to see five of them approved in the next five years.
As for Alaska natural gas, Wellinghoff said he believed it "is essential to this country's viability." And, he added, "FERC stands ready [to act] at the point projects are ultimately selected by the state."
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