such as the National Oceanic and Atmospheric Administration (NOAA), the Environmental Protection Agency (EPA), the Minerals Management Service, and the Army Corps of Engineers. Applicants are also encouraged to consult early and often with federal agencies whose jurisdiction is affected by the port as well as with state and local agencies and communities. Since the deepwater LNG ports are by definition located in offshore waters, NOAA's jurisdiction over fisheries, endangered species, whales, marine sanctuaries, and other marine environmental programs is necessarily implicated. NOAA also has a major say in the role of adjacent states under the Coastal Zone Management Act (CZMA), discussed below. Depending on the location of the offshore port, EPA's air regulations will also be implicated. EPA has prepared its own guidebook on licensing LNG projects, entitled "EPA's LNG Regulatory Roadmap". In locating LNG ports offshore California, in particular, the applicant must be aware of state regulations such as those recently adopted by the California Air Resources Board (CARB) requiring applicants to bring emissions to the lowest possible level.
The Role of the States
Weaver's Cove.
Successful Projects
The successful applicant consults early and often with the federal government, states, local governments, and in particular the affected community of local stakeholders. A good example of how this effort pays off is the case of Excelerate Energy LLC which has two deepwater LNG ports currently in operation, one offshore Louisiana (Gulf Gateway), and one offshore Massachusetts (NE Gateway). Excelerate conducted one year of outreach and public meetings before it even filed an application with MARAD. The company met with everyone related to the project, including likely opponents. The company also negotiated with the Commonwealth of Massachusetts and established a $23 million trust fund to compensate for potential reduced uses of fishery and other resources. The Commonwealth was given the authority to administer the trust fund.
The Future
The states have at least two important roles in the LNG port approval process which can complicate, delay, or deny the license. The Governor of an "adjacent coastal state" has 45 days from the date of the final public hearing on the EIS to review the project and give his or her approval. If the Governor disapproves, the Administrator of MARAD may not issue the license. For example, on May 18, 2007, California Governor Arnold Schwarzenegger issued a formal letter disapproving of the proposed BHP "Cabrillo Port" LNG deepwater port planned for construction off the coast of Ventura County, California, citing "significant and unmitigated impacts to California's air quality and marine life." At the same time, the Governor noted his support for the State's increased need for LNG. The applicant must also comply with the federal consistency requirements of the CZMA. This requires the applicant to file a determination of consistency with an affected state's approved coastal zone management program. If the state objects to the determination, the applicant has the right to appeal to the Secretary of Commerce who may override the state's objection if he finds it in the national interest. In the case of the proposed Sparrows Point LNG terminal, the Secretary did override the objection, but he did not do so in the case of
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As the nation looks increasingly to nontraditional sources of energy to replace what may be a dwindling supply of oil, certainly LNG can be expected to be part of the solution. Deepwater ports, located in such a way as to protect coastal regions and busy ports and harbors, will also become an increasingly attractive option. To date, MARAD and the Coast Guard have established an excellent process to approve deepwater LNG ports while ensuring that the public interest in safety, financial responsibility, and protection of the marine environment is met. Future applicants can benefit from the approaches taken by successful applicants, such as Excelerate Energy, above, and consulting early with the stakeholder community. MARAD and the Coast Guard can establish a system of "best practices" to advise potential applicants what may be required in obtaining a deepwater port license and to inform the public of the safety record for LNG. Finally, Congress may wish to revisit the veto power given to the Governors of adjacent states and develop a new appeals process. Ms. Joan Bondareff, along with Jeanne M. Grasso, partner at Blank Rome, work on environmental issues for these projects. The team includes Blank Rome partners Jim Ellis, Jon Waldron, and associate Charles Blocksidge. Blank Rome LLP currently represents two applicants for DWPA LNG licenses. Thanks to Mark Prescott at the Coast Guard for his valuable input.
Marine Technology Reporter 21
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