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Long Beach LNG Sponsors Seek Court, FERC Action

Spurned last month by a harbor commission board that refused to complete several years of environmental review work, the sponsors of the proposed liquefied natural gas (LNG) receiving terminal in Long Beach (CA) harbor Thursday asked a state Superior Court in Los Angeles to force the port to complete the job it took on jointly with FERC more than three years ago.

In a writ of mandate, SES Terminal LLC, a joint venture of Mitsubishi and ConocoPhillips, asked the court to order the harbor commissioners to complete the environmental impact report (EIR) on SES's proposed $800 million, 1 Bcf/d receiving terminal. "The Harbor Commission wrongly curtailed an established environmental process that is designed to objectively evaluate the project on a comprehensive basis and provide the facts to government agencies and the public so they can make an informed decision," said Tom Giles, CEO of SES Terminal.

In related action, SES Terminal has called on the Federal Energy Regulatory Commission to deny a motion by Californians for Renewable Energy Inc. to terminate the agency's proceeding on the LNG project. It urged the Commission to continue processing its application and to issue a final environmental impact statement on the project "as soon as possible."

With a legal opinion supporting the move, the Port of Long Beach Harbor Commission (POLB) on Jan. 22 terminated the long-running environmental assessment, rejecting a four-year-old SES LNG terminal proposal (see Daily/GPI, Jan. 24). The nearly billion-dollar project had been floundering since mid-2006 with numerous delays in getting past the draft environmental review stage that began in late 2005. Finally, the Long Beach city attorney concluded that the environmental impact work was "legally inadequate."

Giles said SES now wants the court to force the harbor commission to direct the Port of Long Beach staff to complete the EIR process as required under the California Environmental Quality Act (CEQA). Otherwise, SES argued that the harbor oversight board's action will "set a precedent with statewide implications" for other projects examined under CEQA.

The harbor commission action, without the court's clarification, "deprives an applicant of the certainty and finality in the permitting process," said SES's Rick Hernandez, COO of the firm. "It suggests that at any time during the environmental review process, a project applicant may be at risk of having its project abandoned."

In its filing at FERC, SES Terminal said it "categorically rejects the unfounded assertion" of the Long Beach city attorney that the environmental assessment "is and and in all likelihood will remain legally inadequate." Further, it said it "strongly denies " the allegation by the attorney that "FERC has inappropriately deferred much of the safety analysis and planning" related to the LNG project.

"This reckless assertion calls into question not only FERC's procedures and the efforts of its staff, but the legal obligations, procedures and efforts of the U.S. Coast Guard," which has committed "substantial time and resources to reviewing the safety and security of the proposed LNG tanker traffic and use of the port," the company argued.

It further disputed allegations that FERC has withheld "significant details" from the city of Long Beach, claiming they were sensitive in nature. "Nothing could be further from the truth. The staffs of both FERC and POLB have had access to all the information necessary to evaluate the safety and security issues" associated with the proposed terminal, SES Terminal said.

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