Australia’s resources giant BHP Billiton will close its Southern California office in Oxnard, CA, at the end of July, consolidating West Coast liquefied natural gas (LNG) operations in its Houston office, a California spokesperson for the company told NGI Wednesday. A Houston-based spokesperson separately confirmed that the Cabrillo Port offshore LNG receiving terminal project is effectively dead, and the company continues to weigh its options in California.

Meanwhile, the onshore LNG terminal proposal in Long Beach harbor — a joint venture of Mitsubishi and ConocoPhillips called Sound Energy Solutions (SES) — is alive on several fronts despite having its final environmental impact assessment (EIS) abandoned earlier this year by the Port of Long Beach. A lawsuit filed in a California Superior Court in Los Angeles by SES is set for hearing in September or October, according to Tom Giles, COO of the company.

The last nail in the coffin for BHP Billiton’s plans to process up to 1.5 Bcf/d of LNG at a terminal 21 miles offshore Southern California between Oxnard and Malibu came June 5 when the federal Maritime Administration (MARAD), which had to issue a deepwater port license for the facility in conjunction with state permits, formally denied BHP Billiton’s application. MARAD said it had no choice after California Gov. Arnold Schwarzenegger rejected the site May 18.

“[Schwarzenegger’s] disapproval was primarily based on concerns that the Cabrillo Port project, as proposed, would result in significant and unmitigated impacts to the state’s air quality and marine life,” MARAD said in its deepwater license denial.

In rejecting the Cabrillo Port project, Schwarzenegger stressed that LNG still has a role to play in California’s future energy portfolio. He made clear that his rejection was based on the fact that he concluded the project developers failed to meet environmental standards (see Daily GPI, May 21).

The Houston-based spokesperson said BHP Billiton is continuing to assess all the options to determine what, if anything, it will do next regarding the West Coast. Any resumption of a LNG project would take a new application and proposal, the spokesperson said.

In Long Beach, Giles said SES is still active “out in the community,” meeting with groups and carrying on a public communications program, including local advertising. “We’re also waiting on the final environmental impact statement from the Federal Energy Regulatory Commission,” he said, noting that FERC’s website page for the project indicates it is working on it.

“We still think we’re the farthest along of all the projects,” Giles said.

In the meantime, SES’s lawsuit is attempting to get the court to order the port to finish and publish the final EIS/EIR [environmental impact review]. Giles said his company hasn’t had “a lot of dialogue” with the city or port since the legal action was taken (see Daily GPI, Feb. 12).

SES Terminal LLC, the Mitsubishi/ConocoPhillips joint venture, in its lawsuit asked the court to order the harbor commissioners to complete the environmental report on SES’s proposed $800 million, 1 Bcf/d receiving terminal. “The Harbor Commission wrongly curtailed an established environmental process that is designed to objectively evaluate the project on a comprehensive basis and provide the facts to government agencies and the public so they can make an informed decision,” said Giles at the time of the filing.

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