A proposal that surfaced Monday in the lower house of the Oregon Legislature bids to tighten the state’s authority in the siting process for liquefied natural gas (LNG) facilities. At least one LNG project proponent has labeled the proposal as unworkable and unnecessary, along with denying the state future economic benefits that could come with LNG imports.

The proposal has been reviewed by the Legislative Counsel, is supposedly undergoing revisions and is awaiting the assignment of a bill number, according to a summary by state Rep. Deborah Boone. What is being called the “LNG Public Protection Act” was carefully drafted to provide state authority not preempted by the powers given the Federal Energy Regulatory Commission (FERC) in the Energy Policy Act of 2005 (EPAct), Boone said.

State powers rest in the areas of water, air, coastal management and state lands regulation. Terminals and connecting pipelines need state land permits. NorthernStar Natural Gas Inc.’s Bradwood Landing LNG project along the Oregon side of the Columbia River has conditioned approval from FERC, depending on obtaining necessary state and local permits.

Based on the summary and not a full text, a spokesperson for NorthernStar’s Bradwood Landing project said the proposed bill’s provisions “are either unnecessary or unworkable.” He warned that the proposed bill could limit Oregon’s natural gas supplies, which he stressed would be a bad idea.

“Clean-burning natural gas represents a rational choice to ensure energy affordability and reliability, and it is necessary to firm up renewable energy sources,” the Bradwood Landing spokesperson said.

The spokesperson also cited an economic analysis by a University of Oregon economist, Phil Romero, concluding that the proposed receiving terminal could reduce wholesale gas costs by 13% in the region while helping to create 5,000 to 20,000 new jobs.

The proposed state LNG protective measure attempts to assure that four tests are met by any project in the state: (1) clear need for the LNG (as opposed to added pipeline supplies from new basins in the United States and Canada), (2) LNG meets the state’s greenhouse gas (GHG) emissions mitigation strategies, (3) natural resources are protected, and (4) public health and safety are not jeopardized.

According to its sponsors, the proposed LNG bill would not affect gas pipeline supplies, ban LNG terminals, create additional permit requirements or establish additional administrative burdens on prospective project developer/operators.

Bradwood Landing’s spokesperson countered that Oregon authorities have already established the need, GHG emissions rules already cover any terminal proposal in the state, and LNG facilities (for storage) have operated safely in Oregon since 1969.

“The sponsors of the proposed bill have no idea how natural gas markets actually work,” said the spokesperson. “If they did, they would realize that LNG would provide access to lower-cost supply.”

Further, the terminal backers argue that the state bill “would create arbitrary and vague standards regarding beneficial uses that would be unenforceable and expose the state to legal challenges.”

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