Crown Landing LLC, which is developing a liquefied natural gas (LNG) terminal on the Delaware River in Gloucester County, NJ, has asked FERC to give it a one-year extension to revise a permit application for the project.

An affiliate of Hess LNG late last year acquired Crown Landing from BP plc (see Daily GPI, Nov. 4, 2009). At the time Hess LNG officials said the New Jersey site was a “strategic” location for an LNG facility and said it could be completed in about seven years.

Now it appears the project is moving forward, if the Federal Energy Regulatory Commission (FERC) gives it a one-year extension to file permit plans. The deadline now is June 20 (No. CP04-411-000).

Crown Landing CEO R. Gordon Shearer said he wants the LNG facility proposal to be downsized and relocated outside of Delaware waters before proceeding.

Crown Landing has had a controversial run since its inception. In October 2008 BP suspended the LNG terminal plans after the U.S. Supreme Court ruled that the state of Delaware could block the construction of an off-loading pier in New Jersey (see Daily GPI, Oct. 9, 2008; April 1, 2008). Justices said Delaware had veto power over river bottom construction within its boundaries, even if the construction extended into the river from New Jersey’s shoreline.

In his letter to FERC, Shearer said Crown Landing had identified “a number of project design modifications which, if implemented, Crown Landing believes will allow the project to comply” with the various regulatory objections, including those of Delaware officials.

“Crown Landing also intends to reduce the size of the project (install one storage tank in place of the three previously planned, and decrease send-out capacity to the order of 600 MMcf/d, or about half the original send-out level) to match projected market needs more closely,” Shearer’s letter stated. “Additional modifications may flow from the ongoing studies in the coming months.”

Crown Landing asked for an extension to June 30, 2011. If the request is approved, there would have “sufficient time,” said Shearer, to complete necessary technical and environmental studies that include:

During the extension period Crown Landing would “consult and coordinate” with officials and other stakeholders to prepare revised FERC resource reports and other related regulatory filings.

One of the berth alternatives now under consideration would require discussions with third parties to assess its potential, said Shearer. Other agreements negotiated by BP also have lapsed, and they would need to be “revised in light of the passage of time and the revised project scale.”

In addition, Crown Landing doesn’t intend to request Texas Eastern Transmission LP to extend the time required to construct associated pipeline facilities that were part of BP’s original application, he said.

“Based on initial reviews (which will be the subject of a more definitive analysis during the next several months), it appears that the existing pipelines which cross the Crown Landing site may provide sufficient takeaway capacity to obviate the need for the construction of the proposed Texas Eastern lateral across the Delaware River to Chester, PA,” said the CEO. “This will further reduce the environmental impacts of the project and simplify the permitting process.”

Crown Landing currently plans to connect to Columbia Gas Transmission and Transcontinental Gas Pipeline, both on the project site.

Officials also are evaluating the viability of installing LNG truck loading facilities at the site to supply LNG peak shaving facilities in New Jersey, Pennsylvania, Delaware and Maryland to deliver high pressure regasified LNG to the Northeast.

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