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Gold/Mining/Energy : LNG -- Ignore unavailable to you. Want to Upgrade?

To: Dennis Roth who wrote (297)	6/14/2005 7:51:06 AM
From: Dennis Roth	Read Replies (1) \| Respond to of 919

Texas firms join race for LNG project Proposal for facility off Gloucester will vie with earlier plan By Peter J. Howe, Globe Staff \| June 14, 2005 boston.com Launching an offshore land rush, two Texas energy companies formally applied to the federal government yesterday for permission to build a linked pipeline and liquefied natural gas unloading station about 13 miles off the coast of Gloucester. The moves by business partners Duke Energy Corp. and Excelerate Energy LLC set up a head-to-head race with Neptune LNG LLC, which filed a $900 million plan in February with the US Coast Guard for its own offshore gas facility in the same general area. Neptune is owned by the same global energy conglomerate that owns the Distrigas liquefied natural gas terminal in Everett, Suez SA of Paris. Both companies say their proposals will help meet booming demand for natural gas in Eastern Massachusetts while also addressing longstanding fears that LNG tankers headed through Boston Harbor to the Everett terminal could be attacked by terrorists, potentially generating a fireball that could incinerate waterfront areas and kill thousands of people. If regulators approve, nothing would prevent both projects from being constructed. But whichever plan gets into operations first is likely to have a strong business advantage over its rival. Excelerate began work on its plan months before Suez, but Suez has a large base of existing customers it has served for up to 30 years. ''This is a great opportunity both to connect a new supply source in close proximity to the market and increase the supply and delivery options available to our customers," said Greg Rizzo, a group vice president for Duke Energy Gas Transmission of Houston. Compared to the original Excelerate plan made public last year, Duke and Excelerate have agreed to shift the location of the $200 million floating buoy complex about 2 miles south. They are hoping to placate Gloucester fishermen and lobstermen who feared the LNG docking complex would shut them out of rich fishing grounds. Duke would build a 16.4-mile, 24-inch diameter pipeline at a cost of $179.7 million to bring gas from the Excelerate offshore facility into the Boston-area gas pipeline system. Duke owns the 29-mile HubLine undersea gas line from Beverly Harbor to Weymouth. After extensive geological surveys, Duke has drastically realigned and lengthened the original pipeline route, shifting it closer to the Cape Ann coast to stay in sandy soils and avoid hard rock. Duke has no equity interest in the Excelerate project and is only proposing to build the ocean-floor pipeline extension as part of a long-term contract to convey gas from the Excelerate offshore station into the local gas transmission grid, Duke spokesman Danny Gibbs said. Suez-Distrigas spokeswoman Julie Vitek said the firm does not fear competition from Duke and Excelerate. ''Suez has many years -- in fact, decades -- of local LNG operating experience," Vitek said. ''We have a demonstrated track record of safe and reliable delivery. We have relationships with major LNG suppliers, tremendous LNG shipping experience, and deep, long-lasting relationships with customers in New England." Suez-Distrigas has operated the Everett terminal since 1971. The two plans are among a flurry of LNG proposals now pending before federal regulators. Last month, despite vehement opposition from Governor Mitt Romney and Attorney General Thomas F. Reilly, the Federal Energy Regulatory Commission said it was confident a company proposing a new LNG plant in Fall River, Weaver's Cove Energy, could operate safely. FERC has rejected, however, a KeySpan Energy Delivery plan to dramatically increase the capacity of an existing LNG plant in Providence. Besides the two offshore proposals, other LNG projects are being proposed for Somerset, northern Maine, and locations in Maritime Canada. Fine-print details of the two offshore loading facilities proposed by Excelerate and Suez's Neptune unit remain secret for now. The Coast Guard will review and approve the plans and does not release project applications until it deems them ''substantially complete," which can take several months. Fears about the projects' impacts on bountiful fishing and lobstering grounds have generated strong opposition in Gloucester. ''We are going to do everything coastal communities can do to make sure these LNG proposals off our shores do not happen," Gloucester Mayor John P. Bell said in February. Thomas P. McShane, a Boston environmental consultant advising Duke, said that after nearly 100 meetings with concerned parties over the last year, the buoy locations ''have been shifted to the south and the west to accommodate information that was provided by the fishing organizations." But, McShane said, ''I think there will still be concerns." Duke expressed confidence it ''is on track to be in service in 2007," McShane said, or as much as two years sooner than Suez has said it envisions the Neptune project beginning operations. Peter J. Howe can be reached at howe@globe.com. © Copyright 2005 Globe Newspaper Company.