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Democrats differ over proposed LNG terminals

06:26 PM PST on Wednesday, February 6, 2008

By JULIA SILVERMAN Associated Press Writer

SALEM, Ore. (AP) -- A clear divide is emerging among Oregon Democrats in the fight over whether to build three liquefied natural gas terminals in Oregon, along with hundreds of miles of buried pipelines to ship the gas to West Coast markets.

At a rally Wednesday in Salem, Oregon House Speaker Jeff Merkley, who is hoping to be his party's U.S. Senate candidate in November, came out against the proposed terminals, which would turn imported hyper-cooled fuel into natural gas. He is the second high-profile Democrat in the last week to publicly oppose the plan, joining Secretary of State Bill Bradbury.

Portland lawyer Steve Novick, another U.S. Senate candidate, also attended the rally and railed against the terminals.

Their stances are in contrast to Oregon Gov. Ted Kulongoski, a second-term Democrat who is open to the idea of allowing the terminals to proceed.

Kulongoski told a panel of editors last week that Oregon could benefit from the addition of liquefied natural gas to its energy portfolio, saying it would reduce the state's dependence on other sources of energy, especially coal and hydropower.

But he has called for a more detailed analysis of potential environmental impacts, including the effect on fish and wildlife habitat, and water quality.

Bradbury, however, is ready to pull the plug on the proposals that would place one terminal in Coos Bay and two on the Columbia River.

"Knowing what I know about the last century of energy policies, I cannot in good conscience support a move that would tie us to fossil fuel imports from foreign countries," Bradbury said. "I do not think Oregon should be the pusher, enabling California's dependence on fossil fuels."

Houston-based Northern Star Natural Gas Inc., which wants to build a terminal at Bradwood Landing, 20 miles east of Astoria, has contended that its proposal would bring a needed influx of new jobs and property taxes to Clatsop County, and shield ratepayers from price hikes as natural gas supplies dry up.

"The most important thing to look at is where the governor is on this issue, because he has had the opportunity to rely upon the state agencies who have examined this issue completely and thoroughly," said Joe Desmond, senior vice president for external affairs at NorthernStar Natural Gas. That company is the farthest along in the permitting process.

Kulongoski isn't running for re-election, but his stance is raising hackles among environmentalists, who have saluted the governor in the past for pushing for legislation to require utilities to draw 25 percent of their energy from renewable sources by 2025 -- a fact about which Bradbury took pains to remind Wednesday's crowd.

"I am a registered Democrat, and I'm disappointed with the governor," said Gales Creek resident Paul Sansone, whose hometown could be host to a future pipeline. "The unrest is viral. People are feeling totally railroaded."

Bradbury's voice is important in the debate because he sits on the state Land Board, which could have jurisdiction over the use of state lands for any LNG terminals and associated pipelines. The other members are Kulongoski and state Treasurer Randall Edwards, who said Wednesday that he is concerned about Oregon's energy future and whether the LNG projects are the right path to take.

"These are extremely complex proposals with multiple hurdles ahead before the issue would ever reach the State Land Board," Edwards said.

Merkley and Novick, meanwhile, are looking to appeal to the sizable group of environmentally aware voters who will weigh in during the Democratic primary on May 20.

"Does this project do damage to Coos Bay if there is a natural tsunami?" Merkley asked, drawing a roaring "yes!" from the crowd. "Does it damage the Columbia shipping channel? Isn't this just one big floating bomb?"

Merkley didn't mention the governor by name, but Novick showed no such restraint, saying: "The governor can stop this process; he can halt the water permits, and he should. Governor, stop this madness."

Concern about the proposed terminals has come to a head lately. The National Marine Fisheries Service recently recommended denial of a permit to dredge the Columbia in order to build a terminal near St. Helens, citing concerns about salmon habitat. And the Federal Energy Regulatory Commission, which has the ultimate siting authority for the terminals and pipelines, has been under heavy pressure to perform a more thorough analysis of the need for

additional gas supply in the state. Landowners, meanwhile, have been increasingly antsy at the prospect that companies interested in building the pipelines will use eminent domain laws to claim their property.

Key federal decisions on NorthernStar's permit applications, which includes a pipeline that would hug the Columbia River for 16 miles before detouring under the river for 50 feet and into Cowlitz County, Wash., for 16 miles to join an existing pipeline along the Interstate 5 corridor, will come within the next few months, Desmond said. With approval, the Bradwood Landing terminal could be operating by 2012, he said.