Senate Rejects Proposal That Would Have Endangered LNG Projects

The U.S. Senate, in a 56-to-37 vote, recently rejected a legislative proposal offered by Sen. Benjamin Cardin , D-Md., that would have put some liquefied natural gas, or LNG, projects in danger.

Cardin said the legislation, which he offered as an amendment to a broad energy bill being debated in the Senate this week, wasn't meant to kill all LNG plants. It was aimed, he said, at restoring states' authority over the location of the energy facilities, which are used to receive shipments of natural gas from overseas.

"This is not about stopping LNG plants from being sited," said the lawmaker. " This amendment is about siting LNG plants where they should be sited. We want to make sure they're sited in the right locations."

Cardin and Sen. Barbara Mikulski , D-Md., are vocal opponents of an LNG project sponsored by Arlington, Va.-based AES Corp. (AES) that calls for a new LNG terminal to be built in area of Baltimore, Md ., called Sparrows Point.

"Those who are the most affected should have the most to say," said Mikulski. "I am absolutely opposed to a new LNG facility at Sparrows Point, Maryland . I worry about a terrorist attack. I worry about an accident. This is a national security issue and a community security issue."

Opponents said the bill would make it so states could trump the Federal Energy Regulatory Commission's authority to approve new LNG facilities, because under the proposal, state governors could block the Army Corp. of Engineers from issuing permits for projects.

Senate Energy and Natural Resource Committee Chairman Jeff Bingaman , D-N.M., a lead author of the underlying energy bill, said the proposal would effectively allow states to have veto power.

"Obviously, there's no point in building a terminal if the ship is not allowed to get near it," he said.

He and Sen. Pete Domenici , R-N.M., another opponent of the Cardin proposal, pointed out that natural gas prices have been rising over the past several years as the nation's gas supply picture becomes increasingly bleak. Natural gas imports are crucial to fill in gaps in U.S. supply and import terminals are needed to bring that gas to consumers, they said.

"This country is going to need large amounts of natural gas over the next 15 or 20 years," said Domenici, the top Republican on the Senate Energy and Natural Resources Committee. "It's terribly important to our country that we have this ( LNG) available when we need it."