Federal
regulators say they, not states, have say over approving natural gas
terminals Associated Press Writer Last update: 24 March 2004 |
WASHINGTON -- Regulators on
Wednesday rejected arguments by California that states and the federal
government have authority over approving liquefied natural gas
facilities.
The Federal Energy Regulatory Commission said the federal
government has sole jurisdiction over siting and construction of the
terminals.
The California Public Utilities Commission had argued that
companies seeking to build an LNG terminal at the Port of Long Beach
must submit an application to the state as well as to the federal
agency.
The issue of jurisdiction over LNG terminals -- including siting
decisions and environmental impact reviews -- is expected to grow in
importance in the coming years. There are nearly 30 proposals for LNG
facilities in various stages of development.
FERC Chairman Pat Wood emphasized that the agency would work with
state and local officials in considering such proposals. He also urged
companies seeking approval for such facilities to do their "local
homework first" before submitting an application to FERC, said an
agency spokeswoman.
Proposals for two LNG terminals -- one in California and the other
in Maine -- were canceled recently because of local opposition.
Calpine canceled an LNG project near Eureka, Calif., because of
what officials said was negative feedback from local citizens and
officials. Strong opposition to the plan surfaced at a Eureka City
Council meeting earlier this month.
In Maine, TransCanada Corp. and ConocoPhillips abandoned a plan to
build an LNG terminal at a former Navy fuel depot site after citizens
in the community of Harpswell voted 55-45 against leasing land for the
facility.
The case involving Long Beach appeared to test the traditional view
that FERC has sole jurisdiction over LNG facilities since it regulates
the transportation of natural gas. In Wednesday's decision, the agency
sought to clarify the jurisdictional question.
The commission said in a statement that it would work closely with
the California officials and with local agencies in reviewing the
application by Sound Energy Solutions, the company seeking to build
the terminal at the Port of Long Beach.
It said it would examine the facility's potential impact on the
environment and cultural resources and take into consideration tanker
operation, marine facilities, safety and terminal siting and
operation.
"We acknowledge the legitimate concerns of the CPUC regarding
matters of safety and security and give our assurance that the
evaluation of the proposed project will include thorough and rigorous
review of these issues," the commission said.
Sound Energy Solutions argued that the California PUC's involvement
cast "a cloud of uncertainty" over the project.
The state agency maintained that while federal law gives FERC
authority over gas imports, it does not explicitly give it authority
over LNG facilities within a state.
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