The Jordan Cove LNG export project in Oregon has begun a new regulatory review, after last year becoming the first LNG export project rejected by the US Federal Energy Regulatory Commission (FERC).
FERC on 10 February approved the project's entry into its pre-filing process, designed to identify major permitting issues and stakeholders before a formal application is filed for construction approval.
The project, owned by Calgary-based infrastructure company Veresen, would comprise an export terminal in Coos Bay, Oregon, and the 233-mile (375km) Pacific Connector pipeline that would bring feed gas from western Canada and the US Rocky Mountain region. The pipeline would extend from the existing regional grid near Malin, Oregon, to the terminal.
Veresen hopes to start construction in the first half of 2019 and begin exporting in the first half of 2024. It plans to submit a formal FERC application in August and get construction authorization in November 2018.
Veresen made several modifications in its pre-filing application, including proposing liquefaction capacity of 7.8mn t/yr, equivalent to about 1 Bcf/d (28mn m³/d) of gas, 30pc more than the previously proposed capacity of 6mn t/yr.
In addition, the previously planned 420MW South Dunes gas-fired generator has been eliminated and midstream company Williams is no longer a 50pc partner in the proposed 1.16-Bcf/d pipeline, which is now entirely owned by Veresen. The previously proposed project was estimated to cost $7.5bn. Veresen did not respond to an Argus inquiry today asking if that figure has been decreased with the elimination of the power plant, which had an estimated cost of $1.5bn. The generator would have sold electricity to the local grid in addition to powering Jordan Cove. The modified project would generate power by placing turbines next to the refrigerant compressors.
FERC in March 2016 denied authorization for the Pacific Connector pipeline because it had not signed any customer contracts to warrant using eminent domain powers that would come with FERC approval. The pipeline would traverse 157 miles of privately owned land and is expected to need such powers to secure all its necessary rights of way, as a number of landowners oppose the project. The agency then rejected the proposed terminal because it would have no way to get gas without Pacific Connector.
Veresen said in its latest pre-filing application that it has acquired land rights along the pipeline route from 38pc percent of private, non-timber landowners. It added that it has been granted property access and survey permission by 69pc of landowners and completed civil surveys on 82pc of the route.
To try to address FERC's concerns, Jordan Cove in March and April announced preliminary 20-year deals to sell half a combined 3mn t/yr of liquefaction capacity to Japanese companies Itochu and Jera. It also signed contracts for 68pc of the planned transportation capacity on Pacific Connector.
It is not clear if those non-binding deals would address FERC's concerns, as the agency in December declined to grant Veresen a rehearing, saying the record was closed with the final decision in March 2016.
