LNG plant wins regulators' OK

Vote on Sparrows Point site rejects opinions of local officials, neighbors

January 16, 2009|By Mary Gail Hare | Mary Gail Hare,mary.gail.hare@baltsun.com

The federal agency that regulates energy approved a proposal yesterday to build a natural gas terminal on the site of the former Sparrows Point shipyard in eastern Baltimore County, rejecting nearly three years' worth of opposition from area elected officials and the project's would-be neighbors.

The Federal Energy Regulatory Commission acted on the proposal - which also includes construction of an 88-mile pipeline to Pennsylvania - despite calls from the U.S. Fish and Wildlife Service and Maryland's congressional delegation to postpone the vote. Organized labor groups support the project, which they say would generate hundreds of jobs.

The five-member panel voted 4-1 without discussion to approve the request from Virginia-based AES Corp. but added numerous conditions - 169 in all - to address environmental and safety concerns raised by federal and state agencies. Chairman Joseph T. Kelliher said he realized the decision would be unpopular but that it is "rooted in a voluminous record and based on sound science."

Opponents maintain that the decision does not mean the end of the battle, and they vowed to continue to throw up legal roadblocks.

The Coast Guard will insist on rigorous security measures, they said. The Army Corps of Engineers said recently it will not issue AES a construction permit until all conditions are met. The U.S. Fish and Wildlife Service said the company must protect the habitats of endangered or threatened species, particularly the bog turtle and the Indiana bat.

"The match is not over," Baltimore County Executive James T. Smith Jr. said. "This decision is just the end of the first round."

Jon Wellinghoff, the FERC commissioner who dissented, said AES failed to demonstrate the need for the project and didn't adequately address adverse impacts on the environment.

"AES seems to have no specific plan to dispose of 300 million cubic yards of dredged materials," he said.

The decreased demand for foreign energy also influenced his decision. "We should first look to domestic supplies of natural gas," he said. "Why should LNG be shipped from the Mideast, when we can pump it from a well in Pennsylvania?"

Organized labor groups welcomed the approval of the $400 million project. John Cirri, president of the United Steelworkers Local 9477, said the terminal will protect jobs at Sparrows Point and create more employment. Ron Suneson, an agent for the Marine Engineers Beneficial Association, said the terminal was critical to keeping the Port of Baltimore competitive.

"In this economy, we can't let opportunities like this slip away," Cirri said.

Elected officials are "responding to nimbyism and not looking at the broader perspective," said Steve Kearney, spokesman for the Sparrows Point Workforce Alliance.

"The more ships, the more jobs, the more prosperity we will have for the port," said Maryland Maritime Association spokesman Rupert Denney.

But Smith said, "You are talking about short-term jobs with a long-term disaster potential."

The conditions that FERC's staff recommended last month "will protect public safety and mitigate any adverse environmental impact and assure the AES Sparrows Point LNG Project will provide service in a safe and secure manner and provide fuel to generate electricity and heat homes," Kelliher said.

However, Gov. Martin O'Malley said the decision "flies in the face of every tenet of environmental justice." He added that the facility "could have catastrophic security and environmental implications for our state."

Rep. C.A. Dutch Ruppersberger criticized the timing of the vote, five days before the Obama administration takes office. "We will work with all of the agencies involved in this process to investigate ways to stop this plan from moving forward."

U.S. Sen. Barbara A. Mikulski said FERC has rubber-stamped a project without investigating all the issues. "In doing so, they've chosen to ignore the safety and security of Marylanders," she said. "I will work to ensure every mitigation measure is met and the community is protected."

Residents along the proposed pipeline's route have complained repeatedly to lawmakers about the impact on their quality of life. The pipeline is to run through Baltimore, Harford and Cecil counties on its way to southern Pennsylvania.

AES Corp., which declined to comment yesterday, has 30 days to accept the commission's conditions and 90 days to submit implementation plans. Other parties to the case have 30 days to appeal the decision.

Smith said he would be seeking advice from his legal staff on a possible appeal. "There is optimism that in the end, right will prevail," he said.

Vote conditions

The Federal Energy Regulatory Commission approved a plan to build a liquefied natural gas terminal in Sparrows Point and a pipeline to Pennsylvania with conditions that include requiring the developer to:

* Address the disposal of dredge materials.

* Provide additional maritime safety and security measures, and make safety and operational changes to the terminal's design.

* Consult with wildlife officials before pipeline construction begins to determine if the bog turtle and Indiana bat will be affected, and develop a plan to minimize impact on sensitive habitats.

* Revise plans to deal with the impact of the pipeline on homes and farmland.

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