FERC Friday gave a favorable initial environmental nod to El Paso Corp. affiliates Southern LNG Inc., Elba Express Co. and Southern Natural Gas pipeline to double the storage and sendout capacity of Southern LNG's liquefied natural gas (LNG) import terminal in Georgia and build a new 190-mile, 1.2 Bcf/d gas pipeline to move revaporized LNG to growing Southeast markets.

The so-called "Elba III Project, with appropriate mitigating measures, as recommended, would have limited adverse environmental impact," FERC staff said in the draft environmental impact statement on the proposed facilities [CP06-470, et al]. Cooperating agencies included the U.S. Army Corps of Engineers, the U.S. Coast Guard and the National Oceanic and Atmospheric Administration's National Marine Fisheries Service.

Southern LNG seeks authorization to expand its existing LNG terminal on Elba Island in Chatham County, GA, with construction to start later this year. The project will involve construction of two new LNG storage tanks, each having capacity equivalent to 4.22 Bcf, construction of additional vaporization facilities to provide 900 MMcf/d of additional sendout capacity, and modification of marine facilities to accommodate larger LNG tankers and speed simultaneous unloading of two tankers.

El Paso expects to complete the Elba III terminal expansion in two phases, with phase one in service in mid-2010 and phase two completed in 2012.

Elba Express proposes to acquire an undivided interest in Southern Natural Gas' Twin 30s pipelines that extend from Southern LNG's Elba Island terminal to the pipeline's system in Port Wentworth, GA; construct an approximately 190-mile, 42-inch and 36-inch diameter interstate pipeline that would run from Port Wentworth through several Georgia counties to interconnect with Transcontinental Gas Pipe Line in Hart County, GA, and Anderson County, SC; and construct and operate a 10,000 horsepower compressor station on the new line.

Upon completion of the compression, the Elba Express pipeline would have the capability to transport up to 1.2 Bcf/d of revaporized LNG to Transco, which supplies markets in the Southeast, Mid-Atlantic and Northeast regions. The pipeline is targeted for in-service in mid-2010.

Southern Natural Gas has requested authority to transfer an undivided interest in its Twin 30s pipelines to Elba Express. It also seeks permission to acquire an undivided interest in a portion of the new pipeline proposed by Elba Express.

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