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Canada's approval buoys Pacific NorthWest project; Democratic senators ask DOE to slow LNG permitting

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Canada's approval buoys Pacific NorthWest project; Democratic senators ask DOE to slow LNG permitting

Withgovernment approvalin hand, developers of the PacificNorthWest LNG project still face the tough decision of whether tomove forward with it.

Aglutted LNG market, a thick list of required environmental conditions and aprice tag last estimated at C$36 billion are all points Malaysian state energycompany Petroliam NasionalBhd., or Petronas, must weigh in determining how to proceed withits effort to build the liquefaction and export facility on British Columbia'sLelu Island.

Agroup of Democratic senators wants the U.S. Department of Energy to slow downits approval of LNG exports.

In aSept. 21 letter to Energy Department Secretary Ernest Moniz, 12 senators calledthe agency's rate of approvals "alarming." High volumes of LNGexports could increase domestic natural gas and energy prices anddisproportionately affect regions that do not produce large quantities of gas,they said.

"Weask that the DOE slow its approval process until the full impacts of currentlyapproved exports are realized," the letter said. "We believe it wouldbe prudent for the DOE to first evaluate the impacts of approved projects,especially as new export terminals come online, before approving additional LNGexports."

Canada's federal government approved the Pacific NorthWestLNG project, a long-awaited decision on a C$36 billion effort to export naturalgas from northern British Columbia.

The government said Sept. 27 that the project will have tocomply with more than 190 legally binding conditions to mitigate itsenvironmental impact, including a cap on direct greenhouse gas emissions and measuresto protect wildlife. The project is led by the Malaysian state energy company Petronas.

The first U.S. shipments of LNG by rail are set to beginSept. 27 as Alaska Railroad Corp. starts a series of eight demonstrations.

Two 40-foot containers are moving LNG from a Titan LNGfacility near Port MacKenzie, Alaska, to the Fairbanks Natural Gas storagefacility, Alaska Railroad said. The demonstrations, which will conclude Oct.21, are part of a twice-weekly test meant to show community members, regulatorsand producers that shipping LNG by rail is a safe and viable alternative totrucking.

FERC approved Kinetica Deepwater Express LLC's request to abandon itsonshore and offshore Louisiana natural gas system to be repurposed for aFairwood PeninsulaEnergy LNG export project.

The Sept. 22 FERC order granted authorization for theabandonment by sale requested by Kinetica, which previously operated as TCOffshore LLC.

As proposed, Avocet LNG LLC, a Fairwood subsidiary, woulduse the abandoned facilities for a deepwater port project that is underdevelopment by another company owned by Avocet's parent. "Avocet has notfiled anything with the commission indicating that it has begun the process ofapplying for authorization to proceed with a deepwater port project using theGrand Chenier system facilities," FERC said in the certificating order.

Developers and federal regulators have different ideas onwhether to route a natural gas pipeline that would support the proposedAlaska LNG ProjectLLC through the Denali National Park and Preserve.

In comments submitted to FERC on Sept. 23, the EPA Region 10office said a proposed alternative that would route the mainline of the AlaskaLNG project through the national park is the "least environmentallydamaging" option because it could reside in existing rights of way alongthe existing George Parks Highway. The rights of way were issued by the U.S.Interior Department under the Denali National Park Improvement Act.

Texas Lt. Gov. Dan Patrick wrote a letter to FERC urging theagency to approve the Annova LNGLLC project in Brownsville, Texas.

The ExelonCorp.-led project would create 700 on-site construction jobs overfour years and 165 high-paying permanent jobs, Patrick said.

"The Annova LNG project will provide a much neededexport terminal for the abundant supply of Texas natural gas, which will promptdomestic economic growth," Patrick wrote in a Sept. 20 letter made publicon FERC's website Sept. 28.