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FERC asks National Grid to work with RI authorities for proposed LNG project

FERC staff encouraged National Grid LNG LLC to work with Rhode Island authorities during the development of the proposed Fields Point Liquefaction project after the company and the state's environmental agency disagreed over how certain components of the project should be regulated.

In a Jan. 17 letter to the company, staff said it was "not clear whether the subject Rhode Island regulations and processes are preempted in this proceeding" because state regulations are pre-empted only when they interfere with those of the commission. Instead, FERC staff said National Grid should "cooperate with state and local agencies regarding the location of pipeline facilities, environmental mitigation measures, and construction procedures."

The letter comes after the Rhode Island Department of Environmental Management said it "vehemently" disagreed with National Grid's plan to follow the state's soil management plan instead of a public involvement plan when developing a bund wall around an LNG tank. But the state agency agreed with the company that work on the overall liquefaction project should fall solely under FERC.

The National Grid plc subsidiary in April 2016 submitted an application to FERC for the Fields Point project's liquefaction facility, which would be housed at the company's LNG storage facility and provide a local supply of LNG to back up imports from overseas and gas pipeline deliveries at times of peak demand.

Rhode Island legislators in August 2016 asked FERC to reject the Fields Point liquefaction project, calling the facility unsafe and voicing concern that ratepayers would take on the project's costs if the company exports LNG out of the state.

The proposed liquefaction facility would include one gas pretreatment and liquefaction system that would have a capacity of 20 MMcf/d. (FERC docket CP16-121)