LNG battle: 'A fight worth fighting'

Sides dig in as legal wrangling over natural gas terminal and pipeline begins to heat up

Last week's federal go-ahead issued for the Jordan Cove Energy Project's liquefied natural gas terminal near Coos Bay and 230-mile supply pipeline across southwestern Oregon wasn't welcome news for those who have opposed the project since its inception in 2007.

The U.S. Department of Energy on Monday issued a conditional permit allowing the facility to export 800 million cubic feet of natural gas per day for 20 years to countries with whom the United States does not have established free trade agreements.

It was important but insubstantial progress, considering the project's laundry list of state and federal permissions that still must be obtained before any construction begins.

There also are a handful of groups in and outside Southern Oregon who hope the project never breaks ground.

Among them are Ashland-based environmental conservation organizations Rogue Riverkeeper and Klamath-Siskiyou Wildlands Center, the Western Environmental Law Center, the Sierra Club, the community group Citizens Against LNG and the Winston, Ore.-based grassroots organization Landowners United.

These groups and others have been challenging the project publicly and legally every step of the way — and there is no plan to ease off.

"The Department of Energy's conditional approval was certainly something we were expecting and not surprised by," said Forrest English, program director for Rogue Riverkeeper. "I think it's safe to say we will challenge the upcoming environmental analysis, but we'll be involved in every step of the way."

The Federal Energy Regulatory Commission still must issue an environmental impact statement on the Jordan Cove project to prove it weighted potential environmental impacts against economic benefits under the National Environmental Protection Act.

The federal commission in 2009 issued an EIS in favor of the facility and pipeline as a means to import foreign natural gas, but because project leaders in 2012 made the decision to export gas from the facility, a new environmental analysis must be completed.

"I fully expect FERC will issue an environmental impact statement next year approving this facility," said Susan Jane M. Brown, a staff attorney with Eugene-based Western Environmental Law Center.

"It's obviously a long way to go before any shovel hits the dirt ... but I don't think that this thing is ever going to survive the Ninth Circuit," Brown said, referring to the 9th U.S. Circuit Court of Appeals, where the Jordan Cove import project was stayed just before its leaders hit the reset button by turning to the current export proposal.

"It's a fun game until then," Brown said, fully expecting the export project to land back in the high courts.

In the meantime, "my clients are doing a variety of things: educating lawmakers both at the state and the federal level, they have been engaging the state and federal regulatory agencies, outreaching to members of the public and conducting public education," Brown said.

Violations of landowners' rights, proposed and potential environmental impacts of the facility and pipeline and a staunch disagreement with the practices of the industry backing the project are overlapping concerns of those opposing the development at Jordan Cove.

Many of the groups also argue that there are flaws in the federal economic research pushing Jordan Cove and similar projects forward, and that it is based too much on a recent boom in the domestic supply of gas.

"If you happen to be concerned about the impact of fracking and impact of methane emissions relative to the climate, well the more domestic gas you rush to export the more of this you get. ... I believe that it's wrong, and I believe that it is a fight worth fighting and a fight that we'll continue," said 70-year-old Bob Barker.

His retirement property north of Shady Cove is where the Pacific Connector Gas Pipeline is proposed to cross under the Upper Rogue River as it snakes its way from Coos Bay to Malin, where it would link up with the existing TransCanada Gas Transmission Northwest pipeline.

The Pacific Connector pipeline is jointly owned by Veresen Inc. and the Williams Co. based in Salt Lake City. Williams initially proposed the pipeline in 2006. If the project is approved, eminent domain could be used to acquire the necessary access, but project backers have stressed they would prefer to work with willing landowners.

"I am adamantly opposed to the use of eminent domain from the point of this being an export pipeline ... eminent domain for that purpose should not be permitted," Barker said. "This thing has dragged on for years, way too long, people don't have the ability to use their property the way they want to, selling prices are impacted ... it's terrible."

Barker, who retired to the property in 2009 with his wife, said he is equally concerned about the safety risks of living near what would be an about 3-feet-in-diameter natural gas pipeline.

"There are very clear downsides to this. ... Every year that this is delayed is a year that I get to enjoy my property without it being trashed," Barker said. "This is clearly all about maximizing profit for energy companies, there is huge opportunity for them to sell this gas overseas and landowners like us are going to end up paying the price for it."

Proponents of the project point to the domestic boom in natural gas production and an opportunity to sell liquified natural gas from the proposed Coos Bay facility to high-paying markets overseas. The project would also bring about 2,000 temporary construction jobs to the region and about 150 permanent positions that will mostly be tied to direct operations at the Jordan Cove facility. There is also the attraction of the project providing a steady flow of tax and fee dollars to financially stressed Coos County.

A community-based group, Boost Southwest Oregon, is lobbying locally for the project and is financially backed by project developers.

According to its website, in partnership with the Coos County Assessors Office, the group determined that Jordan Cove would pay about $12 million in community enhancement fees each year of a proposed three-year construction period, and between $365 million to $470 million in property taxes over 18 years in operation. Additionally, a to-be assessed community enhancement fee would be required annually for 15 years following construction.

Before that money can be realized, the project must wade through a considerable approval process beyond the say of FERC. Oregon's Department of Energy still must grant a site certificate for the construction of the South Dunes Power Plant that will supply the LNG terminal with electricity.

That application was submitted on Jan. 9 and has been determined "substantially incomplete," according to a March 10 Oregon DOE letter to the applicants following initial review.

Additionally, the Oregon Department of State Lands must provide removal-fill permits for the construction effort, the Oregon Water Resources Department will be responsible for considering water rights licences, the Oregon State Historic Preservation Office will review cultural resource impact and the Department of Land Conservation and Development will have rule on coastal zone certification for the facility.

Federally, the U.S. Army Corps of Engineers will have to provide permits allowing dredging in the bay to accommodate large tankers that would be used to transport Jordan Cove's LNG overseas, and the U.S. Environmental Protection Agency and U.S. Department of Transportation must formally review the project.

Following the DOE approval Monday, U.S. Sen. Ron Wyden, D-Ore., issued a statement applauding the decision. Prior to this year, while chairman of the Energy and Natural Resources Committee, Wyden expressed his concern to the DOE that the natural gas export project should be taken into thorough consideration and approved slowly, but has clearly changed his stance since then.

"We're really disappointed by Wyden's reaction," English said. "He is not giving the state an opportunity to finish its review of the project before jumping in with his support on this one."

Though former Gov. Ted Kulongoski openly opposed the Jordan Cove project, English said his group has yet to see any indication as to where Gov. John Kitzhaber stands on the issue.

Ultimately, English said he is optimistic that Rogue Riverkeeper's and other groups' efforts against the project will be successful. Rogue Riverkeeper is organizing a rally in Shady Cove on April 19 to publicly oppose the project, he said, and Barker said he is just one of several landowners in the area who plan to be there.

"I think there is still a number of hurdles remaining for Jordan Cove," English said. "There are rules that need to be followed; this is a complex process and it is going to take time ... we will continue to monitor the project and keep up what we're doing."

Reach reporter Sam Wheeler at 541-776-4471 or swheeler@mailtribune.com. Follow his at www.twitter.com/swhlr.


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