After receiving a devastating blow from FERC earlier in the month with relation to its proposal to build a liquefied natural gas (LNG) terminal in Washington County, ME, Quoddy Bay LNG LLC told Maine regulators over the weekend it is withdrawing its request for state permits to build the project, but expects to refile them in the future.

In a letter to Maine’s Board of Environmental Protection, Quoddy Bay LNG President Donald Smith said the company is withdrawing its state permit application due to the “global energy and economic markets and trends of the past month” and the uncertainty surrounding “the world LNG supply and demand situation.”

In addition, Smith said the company was having difficulty with part of the project’s proposed facilities. “We still have not been able to firm up the likely Btu content of our LNG and thus have not been able to firm up whether we will have to build the nitrogen mitigation facility,” Smith wrote in his letter to regulators.

Smith added that Quoddy Bay LNG expects to refile for the permits in the near future.

The letter follows the Federal Energy Regulatory Commission’s (FERC) Oct. 17 dismissal of the project’s application, citing the failure of the company to provide requested information (see Daily GPI, Oct. 21). FERC’s dismissal was without prejudice, meaning that the LNG developer could refile once it is able to finalize its design and provide a complete application. The application would be treated as a new proceeding rather than a continuation of the current application process, FERC said. The existing Quoddy LNG application has been pending at the Commission since December 2006 (see Daily GPI, Dec. 18, 2006).

The FERC dismissal came six months after the Commission notified Quoddy Bay LNG that it had suspended review of the project for its failure to submit information on its proposed revisions to the project’s vaporizer facilities and other potential alterations (see Daily GPI, April 28).

Quoddy Bay LNG’s proposal called for the construction of a 2 Bcf LNG import terminal at Split Rock, ME, and a storage project in Perry, ME. The 15-acre site abuts the Passamaquoddy and Cobscook bays. The project included a 35.8-mile gas pipeline from the LNG terminal to the interstate gas pipeline in the Town of Princeton, ME.

With the Quoddy Bay LNG project’s suspension, there are still two other Washington County, ME, LNG proposals. Maine-based Calais LNG hopes to build a terminal in Calais, ME, with a capacity of 1 Bcf/d and Downeast LNG is looking to build a terminal in Robbinston, ME, that would have storage capacity of 320,000 cubic meters.

FERC staff indicated late last week that the proposed pipeline that would serve Downeast LNG’s terminal project faces an uncertain future due to its failure to conduct an open season, which could put the entire LNG project in jeopardy (see Daily GPI, Oct. 28).

©Copyright 2008Intelligence Press Inc. All rights reserved. The preceding news reportmay not be republished or redistributed, in whole or in part, in anyform, without prior written consent of Intelligence Press, Inc.