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Environmental groups target LNG port; For import or export?

By Fritz Mayer
July 31, 2013

TOWN OF BETHEL, NY — The company proposing to build a deepwater natural gas port, which would be located about 17 miles south of Long Island and 24 miles east of New Jersey, says the facility would be used to import natural gas to the Northeast.

Critics, including environmental groups in the Upper Delaware Valley, say once the project receives approval, the company will turn around and seek approval to export liquefied natural gas (LNG). One of the reasons for the suspicion is straightforward capitalism: the price of a million British Thermal Units (mmBTUs) of natural gas in the United States is currently in the range of $3.50, while in Europe the range is well above $9 per mmBTUs and the price in Japan is approaching $17.

The concern is that if the facility is allowed to go forward, and if the facility is then allowed to export, the impact will promote more gas extraction through hydraulic fracturing, and thus drilling and fracking may become profitable in places where at the present they seem not to be, such as Wayne County.

Officials from Liberty Natural Gas (Liberty), the company that wants to build the port, have argued that the facility would be blocked from the export of LNG, and it is not referenced in the application. The company’s website says the project, which is called Port Ambrose, would “deliver additional, diverse supplies of natural gas directly into the growing markets in the downstate, New York City and Long Island areas to help meet existing and future load requirements, particularly during periods of peak winter and summer demand.”

But changing to an export facility would not be very difficult. In December 2012, President Barack Obama signed an amendment to the Deepwater Port Act to allow for the export of LNG from offshore facilities. Under the act, after a facility is licensed, the owners may ask to have any conditions reviewed and possibly have those conditions altered or removed without any public input.

There were two public hearings sponsored by the federal government in mid-July, during which Liberty officials and officials of the Maritime Administration (MARAD) and the U.S. Coast Guard testified that the facility would not be used to export LNG, and at which environmentalists testified that the project only makes financial sense if permission to change to an export facility was later sought.