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Jordan Cove did not have time to prove viability to FERC, CEO says

TheJordan Cove LNG export project in Oregon did not get a full chance to prove itseconomic viability before FERC denied its application, preventing the marketfrom deciding who the "winners" are, the project's leader said.

ElizabethSpomer, CEO of Jordan Cove EnergyProject LP, did not waste time acknowledging the situation as shesat on a panel with leaders of other major U.S. LNG projects at the NorthAmerican Gas Forum on Oct. 3. Hers was the only application that FERC denied.

Spomer said the project was unable to prove commercialsupport for the LNG terminal and related Pacific Connector Gas Pipeline because confidentialityrestrictions kept lead developer Veresen Inc. from disclosing pending contractswith JERA Co. Inc. and ITOCHU Corp. Then theclock ran out in March when FERC announced its decision.

Spomer told the attendees that a project's commercialviability is not something FERC should consider. "Historically, FERC hasalways allowed the market to pick its winners," she said. "Wewouldn't be spending tens of millions of dollars a quarter if we weren't highlyconfident that we have a commercial project."   

FERC denied the export terminal, planned for Coos Bay, Ore.,and the related pipeline over what it determined was a lack of commercialsupport and impacts on surrounding communities. (CP13-483, CP13-492)

Nearly six months after Veresen requested a , Spomer said theproject will continue to press final agreements with JERA and ITOCHU. But, she said,finalizing those contracts is difficult "under the shadow of a FERCdenial." 

Jordan Cove would have a production capacity of between 6million and 7 million tonnes per annum of LNG. Shortly after FERC'srejection, Veresen announced that it had reached agreements for at leasthalf of Jordan Cove's design capacity and binding agreements on PacificConnector that represent more than 75% of its capacity.