An Oregon Circuit Court Tuesday ordered Clatsop County to restore its earlier approval of a 41-mile natural gas transmission pipeline project tied to the proposed Oregon LNG receiving terminal for liquefied natural gas (LNG) at the mouth of the Columbia River.

With a newly elected majority on the five-member Clatsop County Commission the previous approval was withdrawn in January, prompting Oregon LNG to appeal to the court. Clatsop commissioners had previously approved the pipeline last November, but their decision was appealed to the Oregon Land Use Board of Appeals (LUBA) by Columbia Riverkeeper, an environmental group that has opposed both Oregon LNG and a second, now-defunct LNG terminal proposal at Bradwood Landing (see Daily GPI, Jan. 18). LUBA has been involved in all of Oregon's proposed LNG projects.

A unit of Oregon LNG, Oregon Pipeline Co., filed a writ of mandamus with Clatsop County Circuit Court last Friday, and the judge on Tuesday ordered the county to restore its earlier approval of the pipeline. Oregon LNG expects the county to challenge the court action by claiming that it would violate "substantive parts of the county code," said the LNG firm's CEO, Peter Hansen, who does not expect the appeal to be successful.

"In this case it would obviously be difficult for the county [to prove violation of its code] since a neutral hearing officer [originally] found the Oregon Pipeline Co.'s application did comply to the county code, " Hansen said. "And the full county commission ruled that same way Nov. 8 last year."

Hansen said the court's action effectively takes jurisdiction over the permitting process for the pipeline away from the county (and the state's LUBA), orders the county to issue the permit and allows Oregon Pipeline to recover up to half of all the fees paid to the county.

Despite an increasingly tough market facing it and a second proposed Oregon LNG project, Oregon LNG keeps plowing through the local and state permitting process, backed by a major publicly held funding partner, Leucadia National Corp., a New York City-based diversified holding company, along with Hansen, who began the now $1.3 billion project in 2004 as the head of western development for Calpine Corp. Following the power plant developer's Chapter 11 bankruptcy filing in late 2005 he led a small group of management to purchase the development rights with the help of Leucadia.

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