Gov. Ted Kulongoski has put state agencies on notice that he is open to proposals to build liquefied natural gas terminals in Oregon to diversify and shore up state energy supplies.

A memo to state natural resource agencies tasked with providing feedback on the controversial projects outlined the governor's position on LNG terminals, which the memo said should guide them "in asserting Oregon's interests and concerns about individual projects."

The governor, who has offered little public comment on the projects to date, does not favor a categorical, statewide exclusion of LNG terminals, the memo said. He also thinks it unlikely the state could even accomplish such an exclusion given that the Energy Policy Act of 2005 pre-empted and passed its licensing authority over energy facilities to federal regulators.

Three LNG terminals have been proposed in Oregon: two near the mouth of the Columbia River and another in Coos Bay. The terminals would import natural gas that has been super-cooled for shipment and storage as a liquid. The terminals turn the liquid back into a gas then send it to market via pipeline. All three terminal projects would require new gas pipelines to ship the gas across the state.

The terminals and pipeline projects are meeting stiff opposition in the communities where they would be located. Critics decry likely environmental damage as well as potential safety concerns that come with importing and shipping vast quantities of natural gas.

Each of the proposed LNG terminals is capable of importing far more gas than Oregon consumes each day. One of critics' principal objections is that Oregon would absorb the environmental harms and safety risks so developers could ship gas to customers in California.

Californians have blocked several proposed terminals, and critics say developers want to use Oregon as a back door to its southern neighbor. PG&E Corp., the parent company of California's largest utility, has an ownership stake in the proposed pipeline that would bring gas from the Coos Bay terminal to the California border.

Backers of the proposed Bradwood Landing terminal near Wauna insist that virtually all of their gas would be used in Oregon and Washington, though they've told investors the terminal could serve California. Investors in the other Columbia River terminal near Warrenton, meanwhile, have told the California Energy Commission their terminal would help keep California pipelines full.

Both Columbia terminals could connect to interstate pipelines running to California through 200-mile pipelines that are proposed to run through prime Willamette Valley farmland and a big swath of the Mount Hood National Forest.

While the governor has directed the agencies to assert Oregon's interests and closely evaluate the projects, he said the destination of the gas should not be a factor in the state's evaluation of the merits or problems associated with LNG.

"The issues of energy diversity, price and supply stability, bridging to a renewable energy future are as important regionally as they are within Oregon," the memo said.

State agencies have expressed deep concerns to the governor's office about the environmental and safety effects of the LNG and pipeline proposals. They also are bothered by a lack of any independent analysis about the need for LNG or the associated terminals in Oregon.

The agencies' concerns were outlined in draft comments on the Bradwood Landing terminal that were forwarded to the governor's natural resources policy director earlier this month. A copy of the comments were reviewed by The Oregonian. The state intends to provide feedback on the project to the Federal Energy Regulatory Commission in coming weeks.

The memo said the governor was as concerned about the social and environmental impacts of the pipelines as the terminals. Pipeline projects that obtain a FERC license have the power of eminent domain -- a government-granted right to forcibly seize property in exchange for court-set compensation -- and the memo said the governor would insist that such power be used carefully.

Kulongoski sent a strongly worded letter to the pipeline companies last month outlining his concerns, including instances of public meetings being inadequately advertised then changed at the last minute, proposed pipeline routes being changed prior to public meetings without notification to affected landowners, and private land being accessed without permission.

Copyright (c) 2007, The Oregonian, Portland, Ore. Distributed by McClatchy-Tribune Information Services.

Related Project
Bradwood Landing LNG
Facility Type: LNG Owner: NorthernStar Natural Gas, Inc.
Scope: New Construction Location: Bradwood, OR United States