Coastal law figures in gas terminal fight
By JEFF MONTGOMERY / The News Journal
12/12/2004
delawareonline.com
Delaware's Coastal Zone Act will likely be the first - but far from the last - public battleground in a widening debate over BP's plans to put a liquefied natural gas (LNG) terminal along the Delaware River opposite Claymont.
Between now and mid-January, federal officials will conduct a public hearing, issue an environmental analysis and debate how much say local officials should have about the locations for dozens of LNG import centers around the country.
Meanwhile, some scientists around the country are pushing for a moratorium on LNG port approvals, arguing that the Federal Energy Regulatory Commission now has to base its decisions on disputed and controversial assumptions about the dangers of tanker spills and fires. About 15,000 people live within a mile of the BP terminal tanker route north of Wilmington alone - the distance some researchers say will be traveled by blistering heat in the event of a modest-size LNG spill and fire.
"The reports differ on how big the hole might be and how big the fire might be, but they're very large fires," said Jerry A. Havens, a chemical engineering professor and director of the University of Arkansas Chemical Hazards Research Center. "I think it's critically important to understand and get some agreement about what the real hazards are. "
Before the smoke clears, Delaware's Coastal Zone debate could prove a minor skirmish - especially if company lawyers hammer home arguments that Delaware long ago opened its door to an LNG terminal by approving a coal pier for a neighboring power plant.
The Coastal Zone Act, approved in 1971, barred new heavy industries and bulk transfer terminals from Delaware's part of the river and a 275,000-acre buffer along the river, Delaware Bay and Atlantic Coast. Light manufacturing developments and expansions of existing industries were allowed, but only with concessions that reduce pollution or improve the environment.
BP's proposed terminal, in Logan Township, N.J., would receive 100 million or more gallons of liquid natural gas a week. Two or three tankers would arrive weekly, each filled with a gas chilled to minus 256 degrees, condensing the gas into a liquid that takes up 610 times less space. Much of the $500 million project cost would pay for a plant to store, revaporize and distribute LNG, but the dock and unloading pier would extend into Delaware waters.
Company attorneys said the New Jersey revaporizing work qualifies as manufacturing, making the Delaware pier exempt from the Coastal Zone ban because of an allowance in the law for piers to serve single-use manufacturing centers. The terminal could meet 15 percent of current demand in a five-state area that includes Delaware, Maryland, New Jersey, New York and Pennsylvania, BP said.
DNREC has only 25 business days to rule on the "Coastal Zone Status" request, once the state declares the application complete.
"We believe that it's a bulk transfer facility and therefore it's not allowed under Delaware's Coastal Zone Act, plain and simple," said Eileen Butler, environmental advocate for the Delaware Nature Society. "We are not against natural gas, we are opposed to the location, and we want the integrity of the Coastal Zone to be maintained."
BP disagreed, and reserved the right to fight any state control over the project. The company also warned that Delaware would risk a federal lawsuit claiming state interference with interstate commerce if DNREC rejects a project that it would allow if completely inside Delaware.
"One is hard pressed to imagine, were a similar regasification plant to be erected on the Delaware side of the river, that such a plant would be found not to be a manufacturing use," BP's request said.
Bad memories
The project threatens to dredge up painful memories among environmental group members.
In 1992, The News Journal ran on its front page a headline: "Bribe fuels environmental furor." The report detailed a $450,000 payment made to seven individuals, including some environmental group members, to settle a challenge to DNREC's approval of a Coastal Zone permit for what is now the Logan Co-generation plant.
Logan adjoins the site of the proposed Crown Landing LNG terminal. U.S. Generating Co., the original developer, paid the money toward creation of an environmental trust when the seven agreed to drop their case.
Those involved said they took the deal after losing free legal representation and after concluding that the case would fail, producing a bad precedent for the Coastal Zone law.
"The appellants feared to risk getting a bad decision which could hurt their cause later," Jerry A. Shields, former director of Watch Our Waterways, wrote in defense of the settlement. Shields died in 1998.
The settlement fund was used to create GreenWatch Institute, a foundation that provides grants, scholarships and supports an environmental lobbyist in Legislative Hall.
June MacArtor, a former DNREC attorney who served as a GreenWatch officer, said the Logan plant decision was an important one.
"To me, the key thing is: On what basis did DNREC issue that permit for what is now the Logan plant?" MacArtor said. She recalled that some environmental group members opposed the settlement, and others later squabbled over how to use the money.
Richard Fleming, a Delaware Nature Society member who closely followed development of regulations to govern the coastal area in the late 1990s, said he believes that the law should block the project, and disputed the company's claim that the terminal would qualify for a manufacturing exemption.
"A healthy coastal zone is a critical part of the quality of life in Delaware. Whatever the outcome of this case, it is important that environmental protection provided by the [act] is not gradually chipped away, since all of Delaware will be the losers."
Jane Nogaki, a member of the New Jersey Environmental Federation, said the New Jersey groups are watching BP's plan with concern, especially after the recent oil spill at the Citgo refinery briefly crippled the Delaware River port complex and polluted miles of shoreline.
"Obviously, it increases the vulnerability of the area to terrorist attack," Nogaki said. "In case of an accidental release, the effects could reach thousands of people."
More discussion sought
Two national citizens groups recently said the industry appears reluctant to give the public a chance to debate the risk. Public Citizen and the Center for Public Integrity in separate reports cited lobbying records and congressional action they said appears aimed at dealing the public out entirely.
Congressional conferees last month quietly slipped language into an appropriations bill declaring that Congress intended the FERC to supercede state oversight of LNG terminals. A House bill explicitly giving the federal agency complete control was bottled up in committee, but environmental groups expect a fresh push next year.
"I would say you are definitely going to see a resurfacing of legislation that will change the law to give FERC ultimate jurisdiction," said Tyson Slocum, research director for Public Citizen, a group that called attention to the appropriations bill gambit last month.
The Center for Public Integrity, a nonprofit research group that examines public policy issues, reported last week that FERC appears to be "aggressively undermining the authority of state and local governments to reject dozens of proposed liquefied natural gas facilities all across the country," based on a review of agency contacts and meeting records.
FERC spokesman Bryan Lee rejected the center's interpretation and said state and local governments would retain their roles in land-use decisions. But Lee said the commission had developed a system for evaluating fire and spill risks from LNG tankers. He described calls for more study as a "recipe for gridlock."
"There's nothing in our modern industrial life that is risk-free," Lee said, adding that the commission has to consider public benefits from adequate and affordable natural gas supplies.
Not yet written in stone
While some environmental groups argue that industry has FERC squarely in its corner, opposition groups have managed to wage head-on fights in several communities that stopped developers cold, including global giant Exxon.
Casi L. Callaway, executive director of Mobile Bay Watch, a group that led a fight against Exxon's recently shelved LNG terminal in Alabama, said citizens need to participate in reviews of such projects.
"Public opinion was absolutely a huge part of this. I believe that public opinion swayed our governor to step up and say: 'You will not apply for a permit until you do a full study,' " Callaway said. "The public pressure that keeps coming out are these things are not safe in close proximity to communities. But I think the companies are looking to save $5 when they stand to make $5 million. That is a very disappointing thing."
BP's Tom Mueller said the company scanned the region before settling on Logan Township for Crown Landing. Areas closer to Philadelphia would put the plant closer to population centers, Mueller said. Areas to the south would involve longer pipeline developments.
Philadelphia recently tossed its own hat in the ring, seeking offers from developers to build a LNG import terminal along the city's waterfront, expanding an existing center used by Philadelphia Gas Works to liquefy and store domestic natural gas supplies.
"There's all kind of violent disagreement out there as to what the possibilities are," said Havens of the University of Arkansas, who has served as a consultant to communities opposing LNG terminals around the country. "If you did have one of these fires, there's a potential for the ship to be further damaged and possibly even lost."
Contact Jeff Montgomery at 678-4277 or jmontgomery@delawareonline.com |
