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Proposed gas terminal at Long Beach port is losing steam

Harbor officials say they don't want to pursue the facility without clear support from the city.

December 12, 2006|Gary Polakovic | Times Staff Writer

A proposed natural gas terminal in Long Beach Harbor is in jeopardy as officials in that city express growing doubts about safety and other issues surrounding the $700-million project.

The facility, one of several liquefied natural gas processing plants proposed for the West Coast, would be built in the harbor -- the only such project to be situated so close to a major urban center.

The location so complicates an ongoing review that harbor officials suggest halting the environmental impact report before it is complete, effectively putting an end to the proposal.

Harbor Commission President James C. Hankla, in a Dec. 4 letter to the Long Beach mayor and City Council, questioned whether city officials still want the gas terminal. He said his staff has been working to move the project forward while the city has failed to negotiate a deal with the energy company for lower-cost natural gas for Long Beach residents.

Hankla warned the City Council that harbor authorities saw no sense in completing the environmental review, already past due and expected to take several more months, absent "a clear understanding that the city is prepared to support the project." He said bigger priorities loom, such as moving expeditiously to implement a comprehensive $2-billion plan to cut by half sooty emissions at the Los Angeles-Long Beach port complex over five years.

"We're willing to pull the plug if the city isn't going to support the project," said Long Beach Harbor spokesman Art Wong.

Port officials could change their minds if they receive a clear signal of support for the project from City Hall. The port, joined by state and federal authorities, is conducting the environmental review, though the city has jurisdiction in land-use and energy issues.

Support for the project at City Hall has been wobbly despite vigorous lobbying for the project by Sound Energy Solutions, the project developer, and a partnership between ConocoPhillips and Mitsubishi Corp.

In a Dec. 7 letter to Sound Energy Solutions, Long Beach Mayor Bob Foster said he continues to have "grave concerns" about building the natural gas plant so close to a densely populated city.

"On a common-sense basis, you don't put a facility of that size and magnitude so close to an urban area," Foster said Monday. "It almost has enough natural gas to power the entire state in one load. It doesn't make sense to me to put it in the busiest port in the nation. It's a risk for accident and terrorist attack and it's not a good business deal for the city."

The mayor also said that talks between the energy company and the city to secure lower-cost natural gas for Long Beach have stalled. Foster said the city seeks indemnification from the company in the event of lawsuits stemming from an accident.

Bry Myown, spokesperson for Long Beach Citizens for Utility Reform, said the City Council and the port seem to be trying to terminate the project.

"Finally, both the port and the mayor are in agreement with our position that the Port of Long Beach is probably the worst place in the nation to build such a facility," Myown said. "I hope it means both bodies will do everything in their power to stop" it.

The terminal would receive natural gas that has been chilled and liquefied for shipment across the Pacific Ocean and reheat it to produce about 800 million cubic feet of vapor per day for use in power plants, businesses and households. Natural gas is the cleanest fossil fuel, and state officials say growth demands in California require more of it. They say it also helps the state meet air pollution standards.

It is unclear how, or if, the City Council will act. Hankla's letter makes clear he seeks a specific gesture of support for the project from the council or else he will halt work and leave the final environmental impact report unfinished. The project cannot go forward without that document.

But council member Suja Lowenthal says the council could take no action -- in effect, signaling the council's tacit support for terminating the project. "The silence will be resounding," she said.

"I have doubts" about the project, Lowenthal added. "I am uncertain if I'd support this project" because of concerns about its location.

A divided Long Beach City Council voted last year to wait until the environmental review was complete before taking a stand. In June, the city's board of harbor commissioners allowed an agreement with Sound Energy Solutions to lapse, jeopardizing the company's exclusive right to build the plant.

Meanwhile, the energy company has threatened to sue the port and the city of Long Beach if they attempt to halt the project. Officials at Sound Energy Solutions did not return phone calls for comment.

The matter is not on the City Council agenda for the next few weeks.

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gary.polakovic@latimes.com

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