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September 11, 2007

AG wants National Grid to abandon LNG plans

State Attorney General Patrick C. Lynch has called upon National Grid to abandon efforts to establish a liquefied natural gas marine terminal in Providence, now that the utility giant owns the company that originally proposed the project.

National Grid completed its $7.3 billion-cquisition of KeySpan Corp. on Aug. 24, and as such owns the 660,000-barrel LNG tank in Providence that provides natural gas to the region during the coldest days of the year. KeySpan had been seeking permission to expand its LNG facility into a marine terminal so that it could receive deliveries by tankers instead of by trucks.

In 2005, the Federal Energy Regulatory Commission rejected the proposal. KeySpan appealed that decision, and oral arguments are scheduled for Oct. 26 at the United States Court of Appeals for the District of Columbia Circuit.

This morning, Lynch released a copy of a letter he had sent yesterday to Michael F. Ryan, president of National Grid’s operations in Rhode Island, urging the company to drop its appeal.

Lynch and virtually all other public officials have long opposed the project because of the impact on recreational use of Narragansett Bay, as well as the potential safety issues in the event of a terrorist attack or an accidental spill.

“Now that National Grid has consummated its acquisition of KeySpan Corporation, I am forced to question National Grid’s continuing efforts to overturn the decision of the Federal Energy Regulatory Commission,” Lynch wrote.

“I believe National Grid’s reputation for corporate citizenship and environmental stewardship stands in conflict with the continued pursuit of this ill-conceived project,” Lynch continued.

“I strongly urge that National Grid to withdraw its appeal and alleviate the need for the federal appeals court to hear arguments and render a decision on a matter that should no longer be pursued by the Rhode Island’s predominant public utility.…”

Ryan, the National Grid executive, would not comment on the Lynch’s request until he had a chance to speak to the attorney general directly, said David Graves, a spokesman for National Grid.

Graves said that National Grid has not yet decided whether it will abandon the appeal. “This project is under review as are a number of other projects,” Graves said.
The Fields Point LNG storage facility “is very important to our ability to continue providing reliable service,” he said.

-- Journal staff writer Timothy C. Barmann

Posted by Tim Barmann  at 4:23 PM | Permalink

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