A new report on the proposed Broadwater Energy LLC LNG (liquefied natural gas) project suggests the additional gas supplies it would bring to New York state would be a good thing, but they aren’t critical to the market, at least not yet.
Tuesday the Long Island Power Authority (LIPA) released a 176-page report prepared by Levitan & Associates Inc. of Boston on the proposed Broadwater LNG project. Titled “Broadwater LNG: A Technical Assessment,” the report evaluates the potential economic benefits of the Broadwater project for Long Island, New York City and the rest of New York State. It also provides an overview of the technical, environmental and safety issues associated with the project.
The report does not take a position on the Broadwater project, and neither has the LIPA board of trustees since LIPA does not have any regulatory authority over the project.
“The Levitan report provides those with an interest in the project with a useful evaluation of the potential economic value of the natural gas that the Broadwater project could supply for use by either natural gas customers or for the generation of electricity,” said LIPA CEO Richard M. Kessel. “The Broadwater project has stimulated a great deal of discussion. We are hopeful that the report will help facilitate that discussion as the regulatory review of the project moves forward.”
This spring Connecticut Attorney General Richard Blumenthal called on New York state regulators to reject a permit for the controversial deepwater LNG terminal proposed for Long Island Sound (see Daily GPI, April 25). Broadwater Energy, a partnership of Shell Oil and TransCanada Corp., is seeking permission from the New York Office of General Services to occupy land and anchor its LNG facility in the middle of Long Island Sound in New York waters, just short of the Connecticut line. Blumenthal said Broadwater would pose a “direct and substantial threat” to human health and safety, and to the ecosystem resources in Long Island Sound.
Earlier in April, the Long Island Association (LIA), whose membership includes more than 5,000 New York businesses, labor unions, academic institutions and nonprofits, threw its conditional support behind the controversial terminal (see Daily GPI, April 16).
The key energy market economic observations made in the Levitan Report include:
The proposed offshore terminal would include a floating storage and regasification unit with an average sendout capacity of 1 Bcf/d and peak sendout of 1.25 Bcf/d. The Federal Energy Regulatory Commission (FERC) last year issued Broadwater a favorable draft environmental impact statement, concluding that the proposed $700 million facility would not cause major environmental impacts (see Daily GPI, Nov. 20, 2006).
“The Broadwater project is in the process of being reviewed by the appropriate regulatory entities that can either approve or reject the proposal,” Kessel said. “And while the project’s economic benefits are significant, it would seem that because of its location Broadwater should consider how it can provide Long Island with more host community benefits should the project go forward.”
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