In a last-ditch effort the state of Maryland Tuesday asked FERC to withhold approval of the controversial AES Sparrows Point liquefied natural gas (LNG) terminal and associated Mid-Atlantic Express pipeline until the concerns of state and local governments are fully addressed. The Federal Energy Regulatory Commission is scheduled to decide on whether to issue the project a certificate at its monthly meeting Thursday.

Maryland’s concerns about the LNG terminal proposed near Baltimore are “substantial and numerous,” wrote Bruce Michael of the Maryland Department of Natural Resources in a letter to the Commission.

“It is the position of the state of Maryland that authorization of this project is premature and further consideration should be given until critical information required prior to construction is provided by the applicant and all outstanding concerns by the state and local governments are adequately addressed,” he said. “Maryland recommends that a supplemental EIS [environmental impact statement] addressing the state’s concerns…be released for public review and comment prior to authorization of the project.”

In addition, the project site “lies in the view corridor between Fort McHenry National Monument and Historic Shrine, the Patapsco River and Chesapeake Bay, where the extraordinary events which inspired our nation’s anthem took place,” Michael said. “The consideration of effects on these nationally significant resources demands far greater scrutiny than has been given to date.”

Even if FERC approves the terminal and pipeline project Thursday, Maryland could delay the construction of the facilities indefinitely by refusing to issue water permits — as some states have done with controversial gas projects within their boundaries.

The Interior Department’s Fish and Wildlife Service last week also called on the Commission to withhold a certificate decision on the Sparrows Point terminal and pipeline facilities until issues involving endangered and threatened species have been resolved (see Daily GPI, Jan. 8).

FERC issued a final EIS (FEIS) in early December, finding that “if the project is constructed and operated in accordance with AES’ and Mid-Atlantic Express’ proposed mitigation measures, our recommended mitigation measures and route variations presented in…this final EIS, and the Coast Guard’s safety and security measures, construction and operation of the proposed facilities and the related LNG marine traffic would have mostly limited adverse environmental impact.”

The FEIS, however, said the proposed pipeline facilities and/or terminal could have an “adverse impact” on residential areas; property values; camps, parks and trails; and the bog turtle and Indiana bat, as well as on recreational waterfowl hunting practices near the Sparrows Point LNG terminal (see Daily GPI, Dec. 8, 2008). The FEIS is the last step before receiving a project certificate at FERC.

The controversial LNG project has been the target of considerable fighting in and outside the courts, with the case going as far as the U.S. Supreme Court. In October the high court let stand a federal appeals court ruling that struck down a Baltimore County, MD, zoning ordinance banning construction of the terminal (see Daily GPI, Oct. 8, 2008).

In August Baltimore County asked the high court to review a decision by the U.S. Court of Appeals for the Fourth Circuit in Richmond, VA, that held that the county’s zoning ordinance barring the construction of the LNG facilities in certain Chesapeake Bay coastal areas was preempted by the Natural Gas Act. The high court denied the county’s petition for reconsideration of the appellate ruling.

The state of Maryland last June suffered another major blow to its efforts to block the LNG project — this time outside the court system. The Department of Commerce at the time overrode Maryland’s objection to the proposed terminal and pipeline east of the Port of Baltimore (see Daily GPI, June 27, 2008). Based on information submitted during the appeal, Commerce determined that the national interest served by the Baltimore facility outweighed its limited adverse coastal effects.

The Sparrows Point project, which was been the target of intense opposition by state and federal politicians, would have about 1.5 Bcf/d of regasification capacity with a potential for expansion to 2.25 Bcf/d. Regasified LNG would be delivered to regional markets via Mid-Atlantic Express, an 87-mile, 30-inch diameter pipeline that would extend from the terminal to connections with interstate pipelines at Eagle, PA.

The project, including three LNG storage tanks, would be located on 80 acres within the existing Sparrows Point Industrial Complex in Baltimore County. The site was previously owned by Bethlehem Steel and housed a steel manufacturing and shipbuilding facility.

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