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Mass. city takes on Washington to halt LNG project

Posted on: Friday, 12 August 2005, 15:12 CDT

By Jason Szep

FALL RIVER, Massachusetts (Reuters) - Fall River, a Massachusetts city of rusting textile mills, is stepping up a fight to block a liquefied natural gas project that residents fear could become the target of terrorists.

A group of politicians from Massachusetts and Rhode Island filed a petition on Friday to force a federal energy panel to reconsider plans for the controversial terminal of the flammable gas in the coastal city of 92,000 people.

Security experts say an explosion of just one tank on an LNG ship could spark a fire half a mile wide. Richard Clarke, a former White House counterterrorism official, estimates an LNG terrorist attack in a populated area would be "catastrophic."

"It's foolhardy and it's dangerous," said Ed Lambert, mayor of the industrial city where "No LNG" signs dot many lawns after Washington approved the $250 million terminal in June.

"It makes no sense in the post-9/11 world to locate a dangerous facility in a populated area," he said. "This would be the most densely populated area that an LNG facility would ever have been placed in."

Fall River has become a flashpoint in a U.S. debate over plans by President George W. Bush and big energy companies to develop a global market for natural gas with the United States as the world's biggest importer.

Although it accounts for only 3 percent of U.S. gas consumption today, that could hit 30 percent over the next two decades, and energy firms are scrambling to expand the number of LNG terminals in the country to 40 from just four.

Fall River is the first project approved for a populated area and the fight could the set the pace for other coastal proposals -- from California to Texas -- as Washington promotes LNG as a cheaper, cleaner energy alternative, particularly for generating electricity.

TRANSPORT BILL OFFERS HOPE

Leading the battle is Lambert, whose petition is backed by the attorneys general of Massachusetts and nearby Rhode Island and seeks a new hearing by the Federal Energy Regulatory Commission to reverse its approval.

Lambert was given a shot of confidence this week when Bush signed into law a transportation bill that the mayor says could freeze the project in its tracks.

A provision in the bill bans the use of federal funds to demolish a bridge that must come down in order for the massive tanker ships to reach the terminal 60 miles south of Boston.

"We don't think they can legitimately go through with a project to which there is no access for the tankers," he said.

Fall River also could take the battle to court and argue the energy regulator abused its authority by approving the terminal without considering the safety problems.

The company says safety and security arrangements would be in place by the time the first LNG shipment arrives in 2009.

"We intend to pursue our project," said Jim Grasso, a spokesman for Weaver's Cove Energy, a unit of Amerada Hess Corp.'s Hess LNG, which plans to build the terminal.

Despite a security plan, the 9,000 people living within a mile of the terminal risk dying in any attack or accident, the mayor estimates.

Residents such as Dotty Eleuteril are fearful. "It's a bomb," she sighs, standing on her lawn not far from the proposed terminal. "It turns this city into one big target."

Even though Eleuteril's husband is out of work in a city whose unemployment rate is 2 percentage points above the state average, she and the mayor scoff at the suggestion of economic benefits such as $3 million in annual tax gains and new jobs.

"The industry believes it can wave money at Fall River and opposition will go away, or in these working-class communities people won't be organized enough or courageous enough to take these powers on," Lambert said. "It's just a very bad project."

Source: REUTERS

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