The Maine Board of Environmental Protection has agreed to a request by Calais LNG to postpone next week’s hearing on state permits for its proposed $1 billion liquefied natural gas delivery terminal in Washington County.

No new date was set. The board plans to meet with parties to the case in the near future to reshedule the long-anticipated session.

The decision was made reluctantly, according to Susan Lessard, the board’s chair, and comes at considerable cost in time and resources to the board and parties to the case.

The board has been planning five days of hearings in Calais, and public hearings in Calais and Eastport, beginning July 19. More than 100 witnesses were scheduled to testify.

The board’s decision offered a glimpse into the high stakes of the long-running battle over efforts to build an LNG terminal on the Maine coast.
It’s clear from written comments from supporters and opponents of the delay that Lessard was under pressure as she pondered the request.

In an unexpected move on Tuesday, Calais LNG asked the board to postpone the hearing. It said it was lacking specific information needed in the case, including soils data along the pipeline route, wetlands analysis, historical preservation requests and fisheries data.

Both Lessard and some opponents to the project expressed surprise that Calais LNG had come to this conclusion only three business days before the hearing. But with rooms rented and travel plans set, Lessard had to make an immediate decision and had no quick way to evaluate the importance of the missing data.

“Since information needed for the board to make a fully informed decision on the application is apparently lacking, I have reluctantly concluded that the hearing should be postponed,” Lessard wrote Wednesday in a letter to David Van Slyke, a company lawyer.

Commenting after receiving the letter, Van Slyke said the company was pleased that the request was granted, and that the delay would give the board the information it needs to consider all aspects of a very complicated project.

But Sean Mahoney, vice president of the Conservation Law Foundation,  expressed frustration.

“After months of political and legal efforts by Calais LNG to expedite these hearings . . . Calais LNG’s request to postpone the hearings should have been denied,” Mahoney said.

Calais LNG wants to build a gas delivery terminal on 330 acres along the St. Croix River, seven miles south of downtown Calais. The project would feature a 1,000-foot pier, two or three storage tanks and 20 miles of underground pipe connecting the Maritimes & Northeast Pipeline. The terminal would have the capacity to move 1 billion cubic feet of gas daily, and be served on average by one or two tankers a week.

The project’s lead investor and managing member is GS Power Holdings Inc., a subsidiary of the Goldman Sachs global investment bank. A spokesman for the firm, Ed Canaday, declined to comment Wednesday on Calais LNG’s hearing postponement. Canaday also was asked if investors remained committed to the project, in the face of low natural gas prices or other factors.
“We do not comment on market speculation,” Canaday said.

In letters to the BEP, supporters said the economic benefits justified a short delay.

Dana Connors, president of the Maine State Chamber of Commerce, urged the board to approve the company’s request.

“The economic impacts of LNG receipt and storage, both in energy benefits and multiplier effects, are unprecedented,” he wrote.

In case filings, Calais LNG has attempted to quantify the energy benefits.
Roughly half the state’s electricity is generated by natural gas. The price of electricity in Maine is driven by gas 90 percent of the year, the company said, and is based on the highest gas prices in the country.

Building LNG storage in Maine would supplement high-cost gas from southern New England in the winter. That could lower gas costs to consumers by 15 percent, and cut electric costs by up to $100 million a year, Calais LNG estimates.

LNG also could be trucked from Calais to the Domtar paper mill in Baileyville and Lincoln Paper and Tissue, the company said, allowing those manufacturers to switch from fuel oil.

LNG also would cut costs at factories that now use gas, including the Verso paper mill in Bucksport. That point was made in a letter from Glenn Poole, a manager at the mill and president of the Industrial Energy Consumer Group.

The delay also was supported by labor unions and contractors, who said the project would create hundreds of jobs. They are organized under a group called Maine Workers for a Healthier Environment.

Critics of the project dispute the company’s claims of a gas shortage. They say new gas sources – including a recent LNG terminal in New Brunswick and shale deposits in the Northeast – reduce the need for any project in Maine. They had prepared testimony about impacts to coastal wetlands and fishermen, and were poised to chronicle the potential hazards of large LNG tankers navigating Passamaquoddy Bay and the St. Croix River.

Critics questioned the motives for Calais LNG’s delay.

The Conservation Law Foundation charged that Calais LNG had received some of the apparently-missing information on April 6, and has had time to respond. Questions also were raised by Save Passamaquoddy Bay, and We Take Care of Our Land, a Native American intervenor.

“Calais LNG’s claim that it only now – three business days before the hearing – realizes that it cannot meet long-standing information requests is not to be believed,” attorneys for the group wrote to the board.

The request also was opposed by the National Park Service, which, point by point, disputed the reasons that Calais LNG had given for the delay. The reasons also were questioned by the the Roosevelt Campobello International Park Commission in Lubec. The commission’s superintendent, Paul Cole, raised an additional concern: A second terminal proposal, Downeast LNG, is preparing to refile its state permit application for a project in nearby Robbinston. Participating in two LNG proceedings could become overwhelming, Cole wrote, prohibiting the commission from fully participating.

Staff writer Tux Turkel can be contacted at 791-6462 or
tturkel@pressherald.com

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