Samuel Bodman, CEO of Cabot Corp, Secretary of Energy, Supports LNG! Surprised?
August 30, 2005
Plans for Natural Gas Ports Stir Debate About Debate
By SIMON ROMERO
HOUSTON, Aug. 29 - The energy law signed by President Bush this month contains an unusual provision: in places where companies want to build terminals to receive large shipments of liquefied natural gas, the government must hold forums to discuss the role of such gas in meeting energy demand.
Supporters of the terminals say the meetings will help address issues raised by importing the gas, which they expect to become a major source of energy in coming years. But opponents call the meetings a taxpayer-financed method of drumming up support for a fuel that would increase the nation's reliance on foreign sources of energy and that could put coastal communities at risk for tanker accidents or explosions.
The debate over efforts to import more liquefied natural gas, or L.N.G., is expected to intensify after Hurricane Katrina. Natural gas prices surged about 11 percent on Monday to $10.85 per thousand cubic feet in New York, on concern over a disruption of offshore natural gas production.
Tanker imports of natural gas, unlike those of oil, cannot easily be increased because there are only five terminals in the nation to receive and process L.N.G. At one point on Monday, natural gas futures touched $12.07, the highest since trading began on the New York Mercantile Exchange. "These forums are insulting and laughable, given that we're dealing with an administration hellbent on placing these terminals wherever the industry sees fit," said Patrick C. Lynch, attorney general of Rhode Island, who has been outspoken in his opposition to plans for L.N.G. terminals in Providence and nearby Fall River, Mass.
Opponents of L.N.G. projects are particularly worried because many officials in Washington have been pressing for greater support for L.N.G., arguing that the United States needs more of the fuel from abroad to offset rising natural gas prices, flat domestic production and lower imports from Canada. L.N.G. is natural gas that has been condensed so it can be transported in tankers, as oil is.
Alan Greenspan, chairman of the Federal Reserve, has repeatedly called for increasing L.N.G. imports during the last two years, claiming that high prices for natural gas could curb economic growth.
Some members of the Bush administration, including Samuel W. Bodman, the secretary of energy, have worked in the liquefied natural gas industry and support new terminals. During his previous job as chief executive of the Cabot Corporation in Boston, Mr. Bodman oversaw the company's L.N.G. importing terminal in Everett, Mass.
"The construction of new terminals to receive natural gas from the far corners of the earth is precisely what is needed at a time when our own domestic production has run flat, yet demand continues to increase," Mr. Bodman said in a speech in California this month.
Similarly, Patrick H. Wood III, who resigned in July as chairman of the Federal Energy Regulatory Commission, has told industry officials that he expects at least eight new L.N.G. terminals by the end of the decade. In a recent interview, Mr. Wood, responding to concern over the potential for L.N.G.-related accidents, said he would welcome the construction of an L.N.G. terminal near where he grew up in Port Arthur, Tex.
John Grasser, spokesman for the Energy Department's office of fossil energy, which will organize the forums, said it was too early to determine where they would be held and what form they would take. Mr. Grasser said the energy bill required his office to conduct at least three forums over the next year, in consultation with the Homeland Security and Transportation Departments, as well as with governors in coastal states, and that "they should be designed to foster a dialogue."
Supporters of L.N.G. terminals say the forums could help their cause. "There's the thinking that maybe we can legislate a little public relations campaign," said John P. Cogan, a lawyer in Houston who has been involved in brokering liquefied natural gas deals since the 1970's. "Everyone from Greenspan on down says we need this, but it's not happening."
Indeed, some participants in earlier federal efforts to increase awareness about L.N.G. say they are concerned that the forums might support the energy industry's efforts to create a global L.N.G. market while drowning out dissent. Bry Myown, spokeswoman for Long Beach Citizens for Utility Reform, a group opposing plans for an L.N.G. terminal in Long Beach, Calif., said the Department of Transportation paid for her to travel to Washington in February to take part in an L.N.G. Community Awareness Workshop.
According to an agenda from the meeting, presentations at the meeting were limited to government officials; representatives from one energy company, Exxon Mobil; and a Houston-based energy consulting company, the Lukens Energy Group, as well as a scientist from Sandia National Laboratories, which conducted a study last year on the potential for large L.N.G.-related explosions. Ms. Myown said members of the public were allowed only to make short responses to the presentations.
Despite support for the projects on the federal level, local governments and environmental activists have blocked construction of at least three terminals in California, Alabama and Maine. Several other projects have been delayed as energy companies struggle with local resistance.
William S. Cooper, executive director of the Center for Liquefied Natural Gas, a pro-L.N.G. lobbying group, said the inclusion of the forums in the energy bill were a "fortuitous turn of events." "We're glad to see it," he said, adding that he envisioned the forums as a "neutral way to facilitate discussion."
The measure mandating the L.N.G. forums was written by an aide to Senator Jeff Bingaman of New Mexico, the ranking Democrat on the Energy Committee, according to Bill Wicker, a committee spokesman. Mr. Wicker said he was not surprised at the reaction to the forums among anti-L.N.G. activists, given the emotion associated with L.N.G. battles around the country.
Still, Mr. Wicker said: "The intent of the forums is to further promote dialogue and discussion. If they're saying we're pimping for the industry, that's not the case."
Copyright 2005 The New York Times Company
Plans for Natural Gas Ports Stir Debate About Debate
By SIMON ROMERO
HOUSTON, Aug. 29 - The energy law signed by President Bush this month contains an unusual provision: in places where companies want to build terminals to receive large shipments of liquefied natural gas, the government must hold forums to discuss the role of such gas in meeting energy demand.
Supporters of the terminals say the meetings will help address issues raised by importing the gas, which they expect to become a major source of energy in coming years. But opponents call the meetings a taxpayer-financed method of drumming up support for a fuel that would increase the nation's reliance on foreign sources of energy and that could put coastal communities at risk for tanker accidents or explosions.
The debate over efforts to import more liquefied natural gas, or L.N.G., is expected to intensify after Hurricane Katrina. Natural gas prices surged about 11 percent on Monday to $10.85 per thousand cubic feet in New York, on concern over a disruption of offshore natural gas production.
Tanker imports of natural gas, unlike those of oil, cannot easily be increased because there are only five terminals in the nation to receive and process L.N.G. At one point on Monday, natural gas futures touched $12.07, the highest since trading began on the New York Mercantile Exchange. "These forums are insulting and laughable, given that we're dealing with an administration hellbent on placing these terminals wherever the industry sees fit," said Patrick C. Lynch, attorney general of Rhode Island, who has been outspoken in his opposition to plans for L.N.G. terminals in Providence and nearby Fall River, Mass.
Opponents of L.N.G. projects are particularly worried because many officials in Washington have been pressing for greater support for L.N.G., arguing that the United States needs more of the fuel from abroad to offset rising natural gas prices, flat domestic production and lower imports from Canada. L.N.G. is natural gas that has been condensed so it can be transported in tankers, as oil is.
Alan Greenspan, chairman of the Federal Reserve, has repeatedly called for increasing L.N.G. imports during the last two years, claiming that high prices for natural gas could curb economic growth.
Some members of the Bush administration, including Samuel W. Bodman, the secretary of energy, have worked in the liquefied natural gas industry and support new terminals. During his previous job as chief executive of the Cabot Corporation in Boston, Mr. Bodman oversaw the company's L.N.G. importing terminal in Everett, Mass.
"The construction of new terminals to receive natural gas from the far corners of the earth is precisely what is needed at a time when our own domestic production has run flat, yet demand continues to increase," Mr. Bodman said in a speech in California this month.
Similarly, Patrick H. Wood III, who resigned in July as chairman of the Federal Energy Regulatory Commission, has told industry officials that he expects at least eight new L.N.G. terminals by the end of the decade. In a recent interview, Mr. Wood, responding to concern over the potential for L.N.G.-related accidents, said he would welcome the construction of an L.N.G. terminal near where he grew up in Port Arthur, Tex.
John Grasser, spokesman for the Energy Department's office of fossil energy, which will organize the forums, said it was too early to determine where they would be held and what form they would take. Mr. Grasser said the energy bill required his office to conduct at least three forums over the next year, in consultation with the Homeland Security and Transportation Departments, as well as with governors in coastal states, and that "they should be designed to foster a dialogue."
Supporters of L.N.G. terminals say the forums could help their cause. "There's the thinking that maybe we can legislate a little public relations campaign," said John P. Cogan, a lawyer in Houston who has been involved in brokering liquefied natural gas deals since the 1970's. "Everyone from Greenspan on down says we need this, but it's not happening."
Indeed, some participants in earlier federal efforts to increase awareness about L.N.G. say they are concerned that the forums might support the energy industry's efforts to create a global L.N.G. market while drowning out dissent. Bry Myown, spokeswoman for Long Beach Citizens for Utility Reform, a group opposing plans for an L.N.G. terminal in Long Beach, Calif., said the Department of Transportation paid for her to travel to Washington in February to take part in an L.N.G. Community Awareness Workshop.
According to an agenda from the meeting, presentations at the meeting were limited to government officials; representatives from one energy company, Exxon Mobil; and a Houston-based energy consulting company, the Lukens Energy Group, as well as a scientist from Sandia National Laboratories, which conducted a study last year on the potential for large L.N.G.-related explosions. Ms. Myown said members of the public were allowed only to make short responses to the presentations.
Despite support for the projects on the federal level, local governments and environmental activists have blocked construction of at least three terminals in California, Alabama and Maine. Several other projects have been delayed as energy companies struggle with local resistance.
William S. Cooper, executive director of the Center for Liquefied Natural Gas, a pro-L.N.G. lobbying group, said the inclusion of the forums in the energy bill were a "fortuitous turn of events." "We're glad to see it," he said, adding that he envisioned the forums as a "neutral way to facilitate discussion."
The measure mandating the L.N.G. forums was written by an aide to Senator Jeff Bingaman of New Mexico, the ranking Democrat on the Energy Committee, according to Bill Wicker, a committee spokesman. Mr. Wicker said he was not surprised at the reaction to the forums among anti-L.N.G. activists, given the emotion associated with L.N.G. battles around the country.
Still, Mr. Wicker said: "The intent of the forums is to further promote dialogue and discussion. If they're saying we're pimping for the industry, that's not the case."
Copyright 2005 The New York Times Company
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