As part of a federal district court lawsuit, backers of the FERC-approved Jordan Cove liquefied natural gas (LNG) terminal project and related 234-mile natural gas transmission pipeline have accused Oregon state officials of stacking the regulatory deck against the LNG terminal developers because of widespread opposition to their project by the state's attorney general as well as the heads of two state departments specifically named in the legal action.

Pacific Connector Gas Pipeline backers filed their lawsuit in August, alleging that the treatment of the project in Oregon is unconstitutional, unnecessary and unfair to landowners, according to the Salt Lake City-based pipeline company's project manager, Derrick Welling (see Daily GPI, Sept. 7).

The LNG project-related Pacific Connector project is having state regulatory requirements thrust at it as a "pretext to impose the preferences of certain state policymakers to keep LNG terminals and associated pipelines from fairly being considered under the laws of the state," Pacific Connector attorneys said in the lawsuit against the Oregon Departments of State Lands and Land Conservation and Development (DSL and DLCD).

These two departments are using state law to "unreasonably delay and substantially interfere" with the overall permitting and construction of the proposed pipeline, the Pacific Connector developers said in the lawsuit, noting that what they called a significant portion of the proposed 36-inch-diameter, 1 Bcf/d pipeline is located adjacent to existing rights-of-way or on federally owned land. Inherent opposition to any LNG project is coloring the state departments' application of Oregon laws, the pipeline backers allege.

"The state has taken the position that the pipeline project has to acquire property through eminent domain to obtain the landowners signatures of approval before permitting with the two Oregon agencies could even begin," Welling said. "Historically, pipelines only acquire land through eminent domain as a last resort, and even then only after permitting is nearing completion and after regulatory agencies have fixed the final pipeline route. It is one of the last things that takes place."

Oregon Attorney General John Kroger, head of the state justice department, has publicly declared his opposition to LNG projects in the state, the pipeline backers said, citing an Oregon Department of Justice news release in January this year.

Regardless of the state officials' motivations, their interpretation of the state requirement for landowner signatures as applied to the Pacific Connector project "directly conflicts with the Federal Energy Regulatory Commission's authority over and approval of the pipeline project."

"Public statements and comments by Oregon state officials strongly suggest that the state's application and enforcement of the landowner signature requirement to Pacific Connector are a pretext to impose the preferences of certain state policymakers to keep LNG terminals and associated natural gas pipelines from being considered under the laws of the state," the pipeline backers said in their filing in a federal district court in Eugene, OR.

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