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Task Force Report a 'Scathing Indictment' of FERC Action on Broadwater

A report by a task force created by Connecticut's governor found that federal regulators' environmental analysis of Broadwater Energy LLC's controversial liquefied natural gas (LNG) terminal and associated pipeline is seriously flawed, which it insists is enough to "torpedo" the facilities proposed for Long Island Sound.

"The report from the task force is a scathing indictment of FERC's single-minded focus on approving the Broadwater platform no matter what the evidence shows," said Connecticut Gov. M. Jodi Rell last week. Rell formed the task force in August 2005.

"My panel has reached three major conclusions: [the Federal Energy Regulatory Commission] never performed a serious analysis of the potential consequences [of the project]; FERC undertook an absurdly limited review of the alternatives to Broadwater; and the alternatives will likely be meeting the energy needs of both Connecticut and New York before the Broadwater project is ever completed and on-line," she noted.

"On its own, each of these findings is enough to sink Broadwater. Together they are a full spread of torpedoes that ought to blow the entire project out of the water," the governor said. "I cannot fathom FERC's insistence on moving forward with this environmental nightmare. I remain committed to preventing anyone from putting this enormous -- and potentially explosive -- industrial platform in the middle of one of our most important and environmentally sensitive landmarks."

Rell said she plans to contact incoming New York State Gov. David Paterson to discuss her opposition to the Broadwater project and to encourage him to take a similar stance. The president of Connecticut's Senate, Donald Williams, last Tuesday also urged Connecticut to reach out to New York's new governor on the issue of Broadwater.

"The new governor will have hundreds of issues on his desk and he'll be required to get up to speed quickly. We can't afford to drop the ball on Broadwater," Williams told the Associated Press. Paterson indicated last week that he may request more time to consider the Broadwater project. Paterson will succeed disgraced New York Gov. Eliot Spitzer, who is leaving office effective March 17 after being linked to a high-priced prostitution ring. Spitzer in February was given an additional 60 days by the New York's Department of State to decide the state's position on the LNG project.

The Broadwater project "has never been anything more than a poorly conceived band-aid solution to the comprehensive, long-term energy needs of the region." said state Sen. Andrea Stillman of Waterford, CT, co-chair of the task force.

"We are disappointed to read such a vitriolic and factually flawed press release concerning a viable proposal to address a critical issue that plagues businesses and working families -- the crushing cost of energy in Connecticut -- particularly because we have tried numerous times to engage the governor in a substantive discussion about the project," said John Hritcko Jr., senior vice president and regional project director of Broadwater.

In January, FERC issued a favorable final environmental review of the LNG project (see NGI, Jan. 14). "If the proposed project is found to be consistent with the public interest and is constructed and operated in accordance with Broadwater's proposed mitigation methods and the mitigation measures recommended by FERC and [the] Coast Guard, we conclude that it would result in limited adverse environmental impacts," said the staffs of FERC and several cooperating agencies in the final environmental impact statement (FEIS) on the proposed offshore terminal and pipeline facilities [CP06-54].

The primary reasons for the favorable decision were 1) Broadwater's floating LNG storage and regasification unit (FSRU) would be located at least nine miles from the nearest shoreline and would be distant from population centers; 2) the project would result in fewer environmental impacts than any alternatives considered; and 3) the U.S. Coast Guard preliminarily determined that, if specific risk mitigation conditions were implemented, the project waterway would be suitable for use by LNG tankers going to and from the proposed FSRU, according to the Commission's FEIS.

In addition to the Coast Guard, cooperating agencies included the U.S. Army Corps of Engineers, Environmental Protection Agency, the National Oceanographic and Atmospheric Administration's National Marine Fisheries Service and New York's Department of State.

The proposed Broadwater offshore terminal would have an average sendout capacity of 1 Bcf/d and peak sendout of 1.25 Bcf/d. Broadwater Energy, a partnership of Shell Oil and TransCanada Corp., would operate the facility, while Shell would own the capacity and supply the LNG. The project, which is targeted for service in December 2010, would cost approximately $700 million to build.

The LNG would be delivered by tankers, temporarily stored on the floating LNG facility, vaporized and then transported in a new 21.7-mile subsea pipeline that would have an offshore connect with the Iroquois Gas Transmission pipeline that extends across Long Island Sound. Broadwater estimates that an average of 118 tankers annually (two to three per week) would be needed to meet the project's planned sendout volume. The tankers would enter Long Island Sound from the Atlantic at the eastern end of the sound and travel down the middle to the terminal, away from Long Island and Connecticut harbors and not approaching the New York harbor.

Broadwater estimates that approximately half of the natural gas sendout from the offshore LNG terminal would be delivered to New York City, about 25-30% to Long Island and the remaining 20-25% to Connecticut. Currently, New York City, Long Island and Connecticut get about 85% of their natural gas via pipeline from the Gulf of Mexico and Canada, areas where production is expected to decline, the FEIS said. Conversely, gas consumption is projected to increase in the region in the coming years, underscoring the need for LNG imports.

The LNG project has been the target of controversy since its very inception, with most of the opposition coming from Connecticut's congressional delegation, Attorney General Richard Blumenthal and other state officials (see NGI, Jan. 22, 2007).

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