Oregon LNG: State delays decision, frustrating everyone involved

By Ted Sickinger, The Oregonian
January 09, 2014
 
Oregon officials have put off deciding whether a proposed liquefied natural gas terminal near the mouth of the Columbia River in Warrenton is consistent with its coastal management plan.
 
The Department of Land Conservation and Development says it doesn't have what it needs to make the call. That rankles both backers of the project and its opponents. They don't think it's true, for one. And they say the ongoing delays lock everyone in a regulatory holding pattern, including the applicant, taxpayers bankrolling the agencies, and community members and landowners waiting for a decision.
 
Various LNG proposals in Oregon have been in a similar spot for more than a decade. Backers of one project on the Columbia River gave up after spending $100 million, complaining they were caught in a never-ending regulatory loop. The two proposals still standing are Oregon LNG in Warrenton and Jordan Cove in Coos Bay.
 
Either way regulators go, their decision is likely to end up in court, so they need to be vetted thoroughly.  Here's a brief update on the Warrenton proposal and its recent back and forth with the state:
 
Remind me what this thing is:
 
It's a feeder pipeline, storage tanks, and a massive gas liquefaction terminal on the Skipanon Peninsula, located across Young's Bay from Astoria. The pipe would carry Canadian natural gas to the terminal, where it would be super-cooled into a liquid for shipment on tankers to lucrative markets in Asia. Oregon LNG says it will spend $6.3 billion on the project and generate thousands of construction and permanent jobs.
 
Why did the state delay its decision?
 
The Department of Land Conservation and Development, or DLCD, is only one player in the alphabet soup of state and federal agencies involved. Its piece is to determine if the project is consistent with land use policies and goals in the coastal management plan. The agency says Oregon LNG still lacks a passel of local and state permits, and a federal environmental review, so it couldn't process the consistency determination by its Jan 3 deadline. Patty Snow, the coastal program manager, says the review is "on hold" until it receives those materials.
 
Why did DLCD even start the clock on its six months review period if it didn't have what it needs?
 
Oregon LNG forced the issue by insisting its application was complete. The company was anxious for the clock to start so it could freeze which land-use rules its application would be evaluated under before updates to Clatsop County rules were approved. DLCD agreed, but Clatsop County officials think it makes no difference which rules are used to evaluate the project.
 
The delay was for three months? Will it be ready then?
 
Not if DLCD sticks with its insistence on other permits. There's virtually no way Oregon LNG will have all those permits processed in the next three months.   
 
Does DLCD need all the permits to make its own decision?
 
Snow, the coastal program manager, says it does, but it's technical evaluation isn't dependent on the other permits. Clatsop County already denied the project after deciding the 41 miles of pipeline in the county violated rules on uses of forestland and estuaries.
 
Oregon LNG's chief executive Peter Hansen insists the application is complete – all 10,000 pages of it. "We're on a first name basis with every bug and bunny out there," he said.
 
If the county says the project doesn't work, won't the state decide the same?
 
Some think that's inevitable. DLCD makes an independent decision, but looks at the same rules as Clatsop County, uses the county decision as evidence, and doesn't typically substitute its own judgment for any county.
 
Oregon LNG disagrees. It says the county decision is far from the only element in the state consistency review and that the county has no authority over siting pipelines anyway. You can't relegate the entire project to a county determination on a pipeline, Hansen said, when the county has no authority over siting pipelines. That's for federal regulators to decide.
 
Is there any other reason to delay?  
 
DLCD may be forced to make a decision, and may need time to make it legally bulletproof. In general, no state agency wants to be the first to jump on an LNG decision, and Oregon is practicing networked decision making. Hansen says it's like a circular reference in a spreadsheet. "We just can't get out of it."  The company has already spent 10 years and $50 million trying to get a terminal project off the ground, and there are a lot of folks who could use the jobs it would provide, he says.
 
Opponents of the project are equally flummoxed. They say public resources are being wasted and landowners and others livelihoods are being left in limbo.   
 
"There's no reason why the state should waste taxpayers' dollars by granting extension after extension. It has what it needs to deny this application," said Lauren Goldberg, a staff attorney at the advocacy group Columbia Riverkeeper. "We need some common sense leadership from the governor's office on this." 
 
What happens if DLCD approves the project?
 
It's still a long haul. The project needs all the other state permits, including a pollution discharge permit, water quality certification, removal fill permit, water use and storage permits, etc.  Then there's the federal license, export approval and biological opinion. Hansen said the project will have most of its federal approvals in 2014, but he might be a tad optimistic.  
 
What happens if the state denies the consistency determination?
 
Oregon LNG can appeal the decision to the U.S. Secretary of Commerce, likely on the grounds that the county has no jurisdiction, and the project meets both regional and national energy interests.  If it doesn't like that decision, it can go to court.
 
Hansen said the company wants to work with the state because that's what it pledged to do from the start. "We are absolutely consistent with the Coastal Zone Management Act," Hansen said. "We're not looking for a fight, but if that's the only way we can get there then that's the way we'll have to go."
 
 

One Response to Oregon LNG: State delays decision, frustrating everyone involved

  1. BobMc says:

    Wow! Most high school boys know that if a girl keeps putting off saying "Yes" for a date, that she's saying "No." Now, Oregon LNG may feel that the state bureaucrats are "drunk with power," so OLNG should know that the state bureaucrats cannot give informed consent. For OLNG to continue to force the issue would be rape.

    Oh, I see, that is actually the intent of OLNG: rape the Oregon environment to assure Canadian energy can power Asia. Of course, it will say that Oregon really wanted it, and couldn't stop talking about the jobs she was going to get–it was mutual.

    C'mon on Oregon, just say "NO!" Someone will come along that will love you just the way you are, environment and all. It's worth waiting.

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