The U.S. Coast Guard and Maritime Administration has issued a finding of no significant environmental impact to McMoRan Exploration Co. for its amended Main Pass Energy Hub (MPEH) liquefied natural gas (LNG) project, which would be located 16 miles offshore Louisiana. In addition, McMoRan also received a letter from the Department of Natural Resources for the state of Louisiana on Sept. 21, indicating that the proposed facility is consistent with the Louisiana Coastal Resources Program.

McMoRan was forced to change its $900 million LNG project in May to use a closed-loop vaporization system after Louisiana Gov. Kathleen Blanco vetoed the project because of potential negative environmental impacts from a proposed open-rack vaporization system that used sea water to regasify LNG. At the time, the state of Louisiana also said the project was inconsistent with the state coastal resources program.

The changes made to MPEH will cost the company an additional $30 million initially and will add $25 million/year to the project’s operating costs, said McMoRan spokesman Bill Collier.

McMoRan Co-chairmen James R. Moffett and Richard C. Adkerson called the favorable environmental review a “significant milestone, indicating the imminent completion of our permitting process for our proposed major new LNG port. Collier said the company expects to receive final authorizations in January.

“The MPEH project would provide critical supplies of natural gas to our nation, generate substantial direct economic benefits through job creation and investment in the state of Louisiana and Gulf Coast region and be operated in an environmentally responsible manner. We look forward to receiving a positive record of decision on the project.”

The switch to a closed-loop system required several significant changes to the project. Perhaps the most significant was eliminating the need to intake and discharge 134 million gallons/day of sea water. The new system uses no seawater.

In addition, McMoRan will have to relocate a platform to accommodate the eight new vaporizers and will install other equipment that will use 1-1.5% of imported natural gas to vaporize the LNG. However, the changes also will reduce operational air emission from the project.

MPEH will be located offshore on a system of four existing and two new platforms. It will include LNG ship unloading equipment, vaporization facilities, six LNG tanks with 145,000 cubic meters of storage, gas processing equipment, gas liquids metering and pipelines, a 28 Bcf subsea salt dome gas storage facility, a 36-inch pipeline from the hub to Coden, AL, and other facilities. The project will have a peak sendout capability of 2.5 Bcf/d.

The Coast Guard issued a public notice on Sept. 19, establishing a time line for a record of decision on the project, including public hearings to be held during the week of Oct. 2.

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