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FERC Examines Deadly Algerian LNG Blast for Lessons Useful to U.S.

FERC Examines Deadly Algerian LNG Blast for Lessons Useful to U.S.

The fallout from Monday's explosion at Algeria's largest liquefied natural gas (LNG) complex, which killed as many as 27 workers and injured up to 72 persons, has extended all the way to Washington, DC, causing federal energy regulators to question whether a blast of a similar magnitude could occur at LNG facilities in the United States.

"We want to understand fully what happened" to cause the powerful blast that destroyed three LNG plants to determine the potential for such an incident being repeated in the U.S., said FERC Chairman Pat Wood at the agency's regular meeting Thursday.

He noted the agency has sent a letter to the Algerian energy minister expressing its condolences and offering the services of the Federal Energy Regulatory Commission, including dispatching LNG engineers to the site to aid in the investigation.

"If we're taken up on our offer there, I certainly would not hesitate for us to go...there and learn everything we can about it because I think we owe it to the customers, to the developers here in this country to make sure we understand what happened over there" and the likelihood of it being repeated in the U.S., Wood said.

Based on what it learns, the agency could develop additional mitigation measures as part of its safety reviews of LNG facilities to prevent such an explosion in this country, FERC staff noted.

The cause of the explosion at the Algerian LNG complex still is under investigation, but initial news reports indicated that a steam boiler used in the liquefaction process may have been the source, according to staff.

None of the jurisdictional LNG facilities in operation in the U.S. or projects pending before the Commission make use of these high-pressure steam boilers to run steam turbines, a FERC staff member told Wood. The majority of the large LNG terminals and projects in the U.S. are receiving terminals designed to regasify the LNG, not liquefaction plants.

The Commission's safety review of LNG facilities starts at the design phase, and continues through the construction and operational stages, according to the agency staff. U.S. LNG facilities are required to meet the safety requirements of the Department of Transportation, National Fire Protection Standards, industry standards for equipment and design codes, it noted.

Algeria is the second largest exporter of LNG in the world behind Indonesia. In the first nine months of 2003, the country accounted for 37 Bcf of the total 381 Bcf of LNG imported into the United States. This was up from the 26.6 Bcf that Algeria exported to the U.S. in 2002.

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