Prompted in large part by the state's opposition to AES Corp.'s Sparrows Point liquefied natural gas (LNG) terminal proposed for Baltimore County, MD, U.S. Sens. Barbara Mikulski and Benjamin Cardin of Maryland introduced legislation Tuesday that would give state and local governments the right to veto the location of LNG terminal projects.

The measure (S. 1174) would strike a provision in the Energy Policy Act of 2005 (EPAct) that gave the Federal Energy Regulatory Commission the power to preempt state and local concerns about location, construction and operation of LNG facilities, the Maryland Democrats said. The bill would provide states with the same veto powers for onshore LNG terminals that they currently have for offshore terminal projects under the Deepwater Port Act.

Under current law, FERC has exclusive authority to approve onshore LNG terminal location applications. While the law requires FERC to consult with state and local governments about safety concerns, they have no role in the final decision, Mikulski said. Moreover, while the law permits states to conduct safety inspections of LNG terminals, she noted they do not have the authority to require any safety precautions or to take enforcement actions if they discover problems at a facility during a safety inspection.

"A recent [Government Accountability Office] report has given us...more evidence that approving LNG plants -- like the proposed Sparrows Point site in Baltimore -- is unsafe and unwise. Yet federal agencies are all too quick to rubber-stamp these facilities. State and local governments must be allowed to have their voices heard," Mikulski said.

Mikulski has been an outspoken critic of the proposed 1.5 Bcf/d Sparrows Point LNG project, which would be built at the site of a former steel mill on a peninsula that juts out into the Chesapeake Bay in Baltimore. Sparrows Point would be less than two miles from the nearest residential housing. She also unsuccessfully tried to block the reopening of the Dominion Cove Point LNG terminal in Calvert County, MD, following the terrorist attacks in 2001.

At a House subcommittee fielding hearing in Baltimore earlier this week, Mikulski, Maryland Gov. Martin O'Malley, a Baltimore County official, House lawmakers and community leaders made clear their opposition to the Sparrows Point LNG project, citing unacceptable risks to public safety, the economy and environment (see Daily GPI, April 24).

"In recent years, the LNG industry has proposed building dozens of new LNG terminals through the United States. Many of these terminals -- including the proposed terminal at Sparrows Point -- are being planned near populated areas or in environmentally sensitive areas," said Cardin, co-sponsor of the bill. "I am determined that state and local governments have a say in determining the location of future LNG facilities."

The AES Sparrows Point project, which is pending at FERC, would have about 1.5 Bcf/d of regasification capacity with a potential for expansion to 2.25 Bcf/d. Regasified LNG would be delivered to regional markets via the Mid-Atlantic Express pipeline, an 87-mile, 30-inch diameter pipeline that would extend from the terminal to connections with interstate pipelines at Eagle, PA. The pipeline also would include connections with local distribution company Baltimore Gas & Electric (see Daily GPI, Jan. 9).

The project, including three LNG storage tanks, would be located on 80 acres within the existing Sparrows Point Industrial Complex in Baltimore County.

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