Weaver's Cove Energy's fall-back proposal to site a controversial liquefied natural gas (LNG) terminal in the middle of Mount Hope Bay off the coasts of Rhode Island and Massachusetts and transport the LNG onshore may be doable without interfering with other commercial and recreational vessels, according to a report from the U.S. Coast Guard.

"The Coast Guard's long-standing vessel traffic management practices [would] help ensure access to waterways by competing users, with minimal delays to commerce or recreational vessel activity," said the Coast Guard report, which was submitted to the Federal Energy Regulatory Commission in late June, but which was not posted on its website until last Friday.

"The current practices, combined with new recommendations included in the Coast Guard's Letter of Recommendation to FERC regarding the Weaver's Cove Energy's LLC proposal, ensure that the waterway remains safe for users should the proposed waterfront facility and offshore berth be fully approved and constructed," the report noted.

This "significant new information [in the Coast Guard report] has come to my attention" only recently, wrote Gordon Shearer, CEO of Hess LNG , one of the sponsors of the Weaver's Cove facility, in a letter to FERC Chairman Jon Wellinghoff last Friday. He has asked Wellinghoff and other FERC commissioners to tour both the site of Weaver's Cove proposed offshore berth.

The proposed offshore berth in Mount Hope Bay, an arm of Narragansett Bay, would receive approximately 70 deliveries of LNG annually via tanker. The LNG would then be transported via subsea pipeline from the offshore berth approximately 4.2 miles up the Taunton River near Boston to Weaver's Cove's proposed storage and regasification facilities in Fall River, MA, which was to be the original site of the LNG terminal. But due to considerable opposition from residents and lawmakers, the terminal site was switched to Mount Hope Bay.

While FERC approved the Weaver's Cove LNG project in Fall River in 2005, it has yet to approve the Mount Hope Bay project (see Daily GPI, July 1, 2005). According to the Coast Guard, both bays would remain safe for users -- as a result of Coast Guard's vessel traffic management practices and recommended mitigation practices -- "while minimizing adverse impacts to other vessel traffic should the proposed waterfront facility and offshore berth be fully approved and constructed."

The good news came only days after the Coast Guard denied -- for a third time -- Weaver's Cove Energy's appeal of its original propose to bring LNG tankers up the Taunton River to Fall River (see Daily GPI, Sept. 8). The Weaver's Cove LNG project has been through a tortuous battle with FERC, Congress, the Commerce Department, the states, the courts and the Coast Guard to get this project built (see Daily GPI, Sept. 11, 2006, May 15, 2007).

In the latest report, the Commander of the Port recommended that a formal process be developed to ensure that inbound-loaded LNG tankers transiting the Narragansett Bay do not conflict with scheduled major national and international sailing events, which typically receive permits from the Coast Guard. In addition. he proposed greater coordination between the Coast Guard, Northeast Marine Pilots and sailing organizations to mitigate the impact of additional ship arrivals on organized recreational events.

Participants at Coast Guard-sponsored workers suggested the Coast Guard should establish "black out" periods when marine events within Narragansett Bay or Mount Hope Bay would preclude LNG transits or transits of other large commercial vessels.

"Generally all the studies and reports found that vessel traffic (especially commercial vessel traffic) in Narragansett Bay and Mount Hope Bay is relatively light, with a brief period in the summer months of increased recreational boating traffic concentrated in lower Narragansett Bay," the Coast Guard report said.

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