October 8, 2008

U.S. Supreme Court Won’t Hear Balto. County LNG Challenge

By Ben Mook

In a major legal victory for energy company AES Corp., the U.S. Supreme Court on Monday refused to hear an appeal from Baltimore County challenging a liquefied natural gas facility planned for the former Bethlehem Steel shipyard.

"Today, the Supreme Court removed one of the last remaining obstacles to bringing hundreds of jobs and more affordable energy to our region at Sparrows Point," Rod Easter, president of the Maryland Building Trades Council, said in a prepared statement.

The Supreme Court's decision was the latest in a long-running legal battle over the proposed LNG facility at Sparrows Point. Baltimore County Executive James T. Smith Jr. submitted the petition to the Supreme Court on Aug. 15 after an earlier decision by the 4th U.S. Circuit Court of Appeals that the county's modification of zoning regulations was a violation of the Natural Gas Act.

"Obviously we are disappointed the Supreme Court refused to hear the case," Ellen Kobler, a spokeswoman for Smith, said. "But, the county executive will continue to work with the governor, legislators and the community to prevent this dangerous facility from being built."

Baltimore County updated its Coastal Zone Management plan in 2007, changing it so that LNG plants could not be sited near coastal areas. That zoning change was upheld by U.S. District Court for the District of Maryland Judge Richard D. Bennett.

AES, in turn, appealed that decision to the 4th U.S. Circuit Court of Appeals. That court sided with the energy company and said the Federal Energy Regulatory Commission had exclusive authority over the placement of LNG terminals. FERC's five-member panel is expected to vote on the project in November, but its staff has given the project provisional approval.

According to AES' preliminary plans for the project, it will include a marine receiving terminal, three full containment, 160,000- cubic-meter storage tanks, as well as facilities to offload cargo. When completed, the facility is designed to vaporize 1.5 billion cubic feet of LNG daily back to its gaseous state. The facility can be expanded to vaporize 2.25 billion cubic feet per day. It will also include an 88-mile pipeline that would pump the gas to Pennsylvania.

The company has said it could begin construction as early as this year, with operations coming online in late 2010. However, county officials have vowed to keep fighting the project and point out the extensive regulatory process makes the project far from a sure thing.

"The reality is, is that there is still a very long road ahead for approval of this facility," Kobler said.

According to AES, the company will need around 100 permits and approvals required by federal, state and local agencies before it can begin construction.

Originally published by Ben Mook.

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