The U.S. Coast Guard has issued a favorable “letter of recommendation” in response to Dominion Power’s plans to resume imports of liquefied natural gas (LNG) at its terminal facility in Cove Point, MD. The letter “addresses positively the suitability of part of the Chesapeake Bay for LNG marine traffic, [but] it does not in itself represent final authority to commence LNG marine transport operations,” it told the power utility.

Final approval to begin receiving LNG imports will rest with the state of Maryland and various local jurisdictions, according to the Dec. 23 letter from the U.S. Coast Guard office in Baltimore. Furthermore, Dominion still must meet with Coast Guard, state and other officials to map out an operational plan that addresses safety and security issues, said Dominion spokesman Dan Donovan. The meeting is planned for mid-January, he noted.

In finding the shipping channel of the Chesapeake Bay favorable to LNG traffic, the Coast Guard said the “relative navigation hazards” posed by LNG ships would be “similar” to those of vessels that routinely travel the bay; that the “size and operating characteristics” of LNG vessels would not be “significantly different so as to have a significant impact” on other marine traffic; that LNG tankers would encounter “no apparent obstructions, either above or below the water;” that the depth of the shipping channel water would be adequate (minimum of 38 feet) to accommodate LNG tankers; that the tidal range at Cove Point would be sufficient (1.17 feet); and that there were no known underwater pipelines or cables to pose a hazard to navigation.

In addition, the Coast Guard said it examined public concerns about the proximity of LNG import terminal to the Constellation Energy-owned nuclear facility at Calvert Cliffs, MD. “A key factor in moving forward with this letter of recommendation were comments by reputable LNG studies and technical experts, as well as input from power plant representatives and federal, state and local law enforcement personnel,” the letter said.

Sen. Barbara A. Mikulski (D-MD) opposed re-opening the Cove Point import facility because, she said, the “flammable” LNG would pose a hazard to the nuclear plant.

Nevertheless, the Federal Energy Regulatory Commission gave the green light to Williams Cos. in 2001 to reactivate and expand the LNG import services at Cove Point, saying it would provide “substantial benefits” in light of the growing role of LNG in the domestic market and the rising demand for gas on the East Coast (See Daily GPI, Oct. 12, 2001). Williams sold the Cove Point facilities to Dominion in September.

Donovan said Dominion still expects to resume LNG shipments to the Cove Point facility in April or May of next year — the first such deliveries since 1980. For the past 17 years, Cove Point has operated primarily as a peak-shaving facility, liquefying and storing pipeline gas, for use by customers in the Mid-Atlantic and Southeast.

He noted the company also is proceeding with plans to build a fifth LNG storage tank that would double Cove Point’s storage capacity. The expansion is expected to be ready in 2004, according to Donovan.

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