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Puget Sound LNG Transport Project Advances

Plans by Puget Sound Energy (PSE) to develop a $275 million liquefied natural gas (LNG) storage and transportation facility at the Port of Tacoma south of Seattle moved ahead with the recent approval of a lease by the port's governing board. Construction is slated to begin next year and be completed by the end of 2018.

The Bellevue, WA-based utility's plans are part of a larger development slated for a vacant industrial strip in the Tideflats port. In this era of competitively priced and abundant U.S. gas supplies, the mostly idle industrial area has become a magnet for multiple natural gas proposals involving marine transportation and methanol production (see Daily GPI, May 7).

PSE's proposed facility would ensure "dependable, affordable gas service" to 770,000 residential and commercial customers in western Washington during periods of peak demand, a spokesperson said.

In addition, PSE seeks to provide fuel for local transportation companies looking to shift from traditional fuel sources to cleaner LNG in various types of natural gas vehicles (NGV), which are expanding in use among fleet operators. An LNG marine transportation fueling depot also is contemplated on some of the privately held land the port does not control in the 5,000-acre industrial area.

The utility project is an offshoot of a larger, multi-billion-dollar effort to develop substantial methanol production capability for exporting from the Pacific Northwest. Plans previously were announced for twin gas-fueled methanol plants in the lower Columbia River region, with the hope of exporting production to China by 2018 (see Daily GPI, Jan. 27). One would be sited at Port Westward in Clatskanie, OR, and the other at the Port of Kalama in Kalama, WA.

Calling it an “environmental and economic investment” for Tacoma, which is in the midst of transitioning from a logging/fishing emphasis to more marine transportation, PSE CEO Kimberly Harris said the project would underscore efforts to "generate economic opportunities in the region."

The next step for PSE is to sign an agreement with Totem Ocean Trailer Express (TOTE), operator of two trailer ships between Tacoma and Anchorage, AK. TOTE's Orca-class cargo ships travel weekly between the Washington and Alaska ports.

"TOTE has announced plans to upgrade those two vessels to run on LNG instead of diesel fuel," said the spokesperson, adding that there is no target date for inking an agreement. "This innovative technology and cleaner fuel source will help TOTE exceed the new federal air emission standards."

The new standards from the U.S. Environmental Protection Agency require vessels operating within a 200-mile zone along the U.S. and Canadian coasts to reduce sulfur emissions from their engines to improve air quality, the spokesperson said.

When completed, the proposed Tacoma facility would produce enough LNG and storage capacity to displace an estimated 47 million gallons of diesel fuel annually.

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