The Oregon Department of Justice asked the U.S. Department of Energy to put a hold on granting LNG export authority to Jordan Cove Energy Project LP until the developer "has cured the deficiencies in its application and the public is given an opportunity to participate."

"In the instant case, the application is premature and deficient," Jas Jeffrey Adams, attorney in charge for Oregon, said in an Oct. 10 protest made public late in the week. "Jordan Cove Energy Project, L.P. does not have a facility to export LNG, nor has it commenced the process to obtain the necessary authorization from [FERC] for siting and construction of an export facility."

In an Oct. 14 email message, Jordan Cove Vice President Robert Braddock said the state's position was to be expected. "[Attorney General John] Kroger has been opposed to LNG ever since I first met with him just prior to his taking the post of AG back in October 2008," Braddock said. "He told me then that he just didn't want any LNG coming into the country as it would continue our reliance on fossil fuels. Everything he has stated publicly since that time has only confirmed the consistency of his position as being against the use of natural gas. It now appears that he doesn't want anyone to use it, not merely the residents of Oregon."

In its protest, Oregon also criticized Jordan Cove's description of its plan to apply to FERC for liquefaction facilities in mid-2012 as an amendment to its authorization to build an import terminal on Coos Bay in Oregon. "The state of Oregon submits that an application to amend the existing authorization to site and construct an import facility is not the appropriate procedure," Adams wrote. "Rather, where the authorized LNG import facility has not been constructed, the proposal for a dual-use, import/export facility is an entirely new project that requires a new application to site and construct it."

Jordan Cove applied in September for export authorization from DOE. In an interview then, Braddock said an export facility in Oregon makes sense, given the natural gas reserves in British Columbia and the U.S. Rocky Mountain Basin.

The Oregon protest marks the first time that a state has objected to the current generation of LNG export projects in the DOE export application process, although U.S. gas consumer groups opposed to the general idea of gas exports have filed challenges. Louisiana has supported export projects on its territory.

Prolific domestic gas production has satiated a U.S. gas market that some years ago was hungry for LNG imports. Several terminal owners in the past year have made plans to expand import facilities by turning them into bidirectional import-export terminals capable of moving some of that abundant gas production to overseas markets. All of these applied to DOE for an export license before submitting an application to FERC for a certificate to build the liquefaction facilities. (DOE Fossil Energy Docket No. 11-127-LNG)

Copyright 2011 SNL Financial LC. All Rights Reserved.

(Originally published October 17, 2011, in SNL Daily Gas Report.)