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Columbia River Ports Wary of LNG Plans

by Tony Lystra
The Daily News, January 13, 2008

The shipping vessels that travel the Columbia River can cost as much as $60,000 each day to operate, said Larry Paulson, the Port of Vancouver's executive director. The companies that own them, he said, are not fond of delays.

So, if the Columbia River becomes known for hold-ups, Paulson said this week, those shipping firms could abandon ports along the Columbia for more reliable west coast destinations.

That's why Paulson and other officials overseeing the region's ports remain concerned about a Houston company's plan to build a liquefied natural gas terminal on the Columbia River.

The ports haven't said they oppose the plan. But they want to know more about strict security measures surrounding the LNG vessels that would visit Northern Star Natural Gas's plant, proposed for Bradwood, Ore.

At issue are the Coast Guard's rules for LNG carriers on the Columbia, which were announced in February of last year. The Coast Guard, which is responsible for the vessels' security, said the LNG ships will be allowed to pass other vessels only at certain points on the river.

LNG vessels, the Coast Guard said, also will be protected by a 500-yard "exclusion zone." Other ships will be allowed through the zone at the Coast Guard's discretion.

But federal officials have kept the bulk of the plan secret, citing national security concerns. How, the port officials wonder, will the strict security measures affect their customers? And what can be done to assure the ports that their business interests will be secure?

"We are needing to better understand the impact of that vessel traffic on our existing customers," Ken O'Halloren, director of the Port of Longview, said this week.

"Clearly, the intention here is not to create any delays," he said. "We have some questions. We are anxious to have those answered."

Josh Thomas, a spokesman for the Port of Portland, said late last year, "Our primary concern is that it not impact the ability to get ships up and down the river without undue delays or obstructions."

And Lanny Cawley, the Port of Kalama's executive director, said his port also wants to know more about how the terminal would affect shipping traffic.

NorthernStar expects as many as 11 LNG carriers would navigate the 38-mile route up the river each month and dock at its terminal, across the river from Puget Island.

Chuck Deister, a NorthernStar spokesman, said the company has developed a "traffic management plan" with the help of shippers, river pilots and the ports.

"Our ships will not be a burden on the system," he said.

And even if the LNG terminal were running at full capacity --- which NorthernStar says would be unlikely --- traffic on the river would "still be below historic highs," Deister said.

In addition, NorthernStar provided an excerpt from a report, commissioned last year by the company, that downplays the possibility of delays on the river.

"There has been significant and understandable concern about the potential for disruption to 'routine business' and scheduling that LNG carriers may introduce," said the report, by Parsons Brinkerhoff, a consulting firm with offices in the United States, Asia, Europe and the Middle East.

But, it said, data shows "that LNG carrier traffic will not impact the scheduling of vessel arrivals." It also said there are "mechanisms for efficiently integrating inbound LNG carrier traffic into existing and projected traffic flows."

Introducing LNG to the river, the report said, will amount to "business as usual."

Northern Star said the report's full text is not yet available.

Paulson, of the Port of Vancouver, said a final Environmental Impact Statement, expected sometime this year from the Federal Energy Regulatory Commission, may illuminate the matter further. But, he said, "How it works in practicality is going to have to be worked out likely after (the terminal is) done, if it's done."

Asked if that's a big gamble for a port to take, Paulson said, "Sure, and it worries me."

He said he believes NorthernStar representatives are "honorable folk" who will be "true to their word."

But, Paulson said, he also worries that the Coast Guard may change the regulations in the years to come if there were an accident involving LNG or another significant event like the attacks of Sept. 11, 2001.

In that case, he said, "You're stuck with the plant, and what are you doing to do with it? You're not going to shut it down. And other industry is going to have to adjust."

Tony Lystra
Columbia River Ports Wary of LNG Plans
The Daily News, January 13, 2008

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