LNG Clean Slate

Posted Dec. 08, 2010, at 6:28 p.m.

It’s time for a fresh start for Calais LNG. The company’s bid to develop a terminal for importing liquefied natural gas along the St. Croix River is in limbo. But it is a self-imposed limbo, arrived at through requests to delay a Board of Environmental Protection hearing on the project. BEP would do well to tell Calais LNG to go back to the drawing board.

There are larger issues at stake — what strategies Maine employs to address declining sources of oil and gasoline and how it embraces emerging energy sources. Though it is important that these policies be sound, there is an urgency to the process. Even if the federal government charts a clear way forward, states will be competing as producers and handlers. Maine’s challenge, as a likely exporter of electricity and pass-through for natural gas, will be to draw benefits from both.

The letters LNG first greeted Mainers in 2003 when a company proposed building a terminal in Harpswell. In a referendum that followed an emotional and community-dividing debate, residents defeated the plan. Other sites in Casco Bay were reported to be under consideration, but nothing firm materialized. Then news broke that an advance firm for an LNG company was eyeing state-owned Sears Island for a terminal. After the battle in Harpswell, Gov. John Baldacci asserted that no community should have to allow a terminal over the objections of its residents. At an annual town meeting, Searsport residents voted to block any such terminal in their town.

After Harpswell and Searsport were off the board, LNG developers continued to explore possible sites along Maine’s coast, and five years ago, three proposals on Washington County’s Passamaquoddy Bay and St. Croix River were unveiled. Those proposals, under the corporate names Downeast LNG, Quoddy Bay LNG and Calais LNG, have languished for various reasons. Quoddy Bay LNG does not have any application pending before the state, nor does Downeast LNG, though it has applications before the Federal Energy Regulatory Commission.

Calais LNG has been in the headlines for requesting extensions of BEP’s hearing schedule since July. The latest request — the fourth — seeks a postponement until mid-January. The company no longer holds a valid option to purchase or lease the land it wants to use for the project, and it has not provided BEP with evidence of financial backing. These two failures should compel the board to declare the application dead in the water. Calais LNG, if it is able to pull together its plans, can then return with a fresh application.

While private enterprises are free to consider such projects, the state could take a much more active role in identifying appropriate locations for LNG terminals. Passamaquoddy Bay may not be the best location, as opponents have noted. Beyond environmental and marine considerations, the best location also would be appropriate for a consumer of the fuel, perhaps to produce electricity.

The energy world is changing fast. Maine can’t afford to watch it pass by.

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