Friday, February 04, 2005

How the FEDS determine LNG siting

FERC seeks seizure powers
Daniel Fowler , Herald News Staff Reporter

FALL RIVER -- The Federal Energy Regulatory Commission earlier this week asked a Senate committee for the power of eminent domain in the siting of liquefied natural gas facilities, a move which could potentially impact the city, Mayor Edward M. Lambert Jr. said Thursday.
Lambert said an LNG expert retained by the city believes the recommended vapor exclusion zone for Hess LNG’s proposed project is not large enough because a vapor cloud could extend beyond the property where the company hopes to build its LNG facility, meaning that the power of eminent domain might be needed to go forward.

"I think it’s very curious that we raise an issue about the exclusion zones being wrong, and suddenly FERC goes to Congress to get eminent domain powers," Lambert said.

University of Arkansas professor and LNG expert Jerry Havens said he believes a vapor cloud could extend 2,800 feet off the property on North Main Street, where Hess LNG hopes to build the facility, Lambert said.

But according to Bryan Lee, FERC’s Director of Press Services, the request "was not driven by any specific proposal."

"The point that was being made is that, when it comes to hydro power projects and pipeline projects, the commission has eminent domain authority," Lee said. "The commission does not have eminent domain authority for LNG. The proposal that the commission should have the same authority for LNG as it does for hydro and pipelines was not made with a specific proposal in mind."

Eminent domain, Lee said, is a last resort, which allows FERC to take over land on or around a project site.

Land owners are reimbursed "at a fair value," Lee said.

"It’s an authority we’ve had for years," Lee said. "It’s only used after every effort has been made to reach a mutually satisfactory agreement."

FERC’s testimony was part of a conference sponsored by the Senate Energy and Natural Resources Committee on natural gas.

Committee Chairman U.S. Sen. Pete Domenici, R-N.M., said in a statement that the conference included a number of panelists and focused on increasing natural gas supplies, expanding access to LNG, improving natural gas infrastructure, environmental concerns, diversification and conservation and regulatory hurdles.

"What the commission did was respond to the Senate committee’s request for suggestions as to what matters it should address in energy legislation," Lee said. "(Eminent domain) was one issue that the commission included in a wide range of suggestions as to what the committee should consider in terms of legislation that will get necessary infrastructure built."

FERC officials also recommended that FERC be given exclusive jurisdiction over the siting of LNG terminals, among other things.

Lambert said he is "very concerned" about FERC’s request for eminent domain power.

"It sounds like they pretty clearly said to a pro-energy committee that communities could use the current rules to stop these (LNG) projects from happening," Lambert said. "If (FERC) can have the power to essentially take away people’s property, they can put these (LNG facilities) anywhere they want."

FERC officials have said their staff is looking into the city’s contention that Hess LNG miscalculated the distance to which an LNG vapor cloud could extend.

Lambert said Massachusetts Sen. John Kerry’s office attempted to get him permission to testify at the conference, but the request was denied.

"I’m sending a letter (to Domenici) telling him that I’m very disappointed with not being given an opportunity to speak, given that FERC was given an opportunity and spoke to an issue of great consequence to Fall River, which is this eminent domain issue," Lambert said.

"I’m pursuing a request to address that committee sometime in the future."

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