Two news items worth passing along regarding LNG in Oregon this week. One got a fair amount of attention – and the other? This may be the only place you’ll read about it. But it has the potential to undo one of the two remaining LNG projects in the state.
So let’s start with the one that hasn’t been reported.
The proposed site of the Oregon LNG terminal. Photo from Oregon Sierra Club.
The Oregon Sierra Club and Bark are trying to overturn a complicated lease deal between the state of Oregon, the Port of Astoria and the Oregon LNG company. Oregon LNG leases 96-acres of state owned land along the Columbia River near Warrenton. That’s where the company wants to build an LNG import terminal.
Opponents say Oregon LNG is being way undercharged. The company pays $418 per acre, per year, to lease the land. Contrast that with the lease for the Jordan Cove LNG project near Coos Bay. Jordan Cove pays $11,000 an acre. If both companies were paying the same rate, Oregon LNG’s rent would jump from about $40,000 a year, to more than $1 million.
Sierra Club and Bark say the Department of State Lands made a mistake last month when it extended the lease for another 30-years. The groups filed an appeal, saying DSL should reconsider. They argue:
- DSL failed to evaluate whether the lease was in the public interest, as required by law and the Oregon Constitution.
- DSL failed to hold public hearings, even though an LNG terminal would have a major impact on the state.
- DSL undervalued the land, by appraising it as a golf course instead of heavy industrial marine site.
It appears the enviros hope the state will cancel the lease, which could mean Oregon LNG will have no place to build a terminal. Or the price will be jacked up so much, the company may not be able to afford the rent.
Don’t underestimate the impact of these kinds of tactics. The Bradwood Landing LNG project went into bankruptcy just a couple of weeks after enviros won an appeal of the Clatsop County planning process.
A Pipeline On Hold
A one-page letter to the Federal Energy Regulatory Commission created quite a stir this week. The company behind the Palomar natural gas pipeline says it’s reviewing the project to, “reflect potential changes in its commercial arrangements.”
The letter goes on to say, “Palomar continues to seek additional commercial underpinning for the project.”
What’s happened is that Palomar is suddenly without one of its big partners in the project. The pipeline was supposed to bring in natural gas from the defunct Bradwood Landing LNG. Now that supply of gas is gone and Bradwood owes Palomar more than $17 million.
Bark and Hey! NW Natural jumped on the news and called it a win in their campaign to kill Palomar. “Palomar’s initial schedule had them cutting trees this summer,” says Bark Program Director, Amy Harwood. “Every day the pipeline hasn’t been constructed is another day of victory. There’s just too much stacked up against this project.”
Palomar is looking for ways to continue with the eastern half of the pipeline, the part that wasn’t dependent on LNG. Running from Maupin to Molalla, that segment could conceivably be used to bring in natural gas from the Rocky Mountain states. Environmental groups are opposed because building the pipeline would leave a 47-mile long path of clear cut through the Mt. Hood National Forest, impacting endangered species such as the Northern Spotted Owl and the Columbia White Tailed Deer.
Palomar isn’t dead. But as the environmental groups note, the Forest Service has stopped working on the project.
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