Agency Mulls Review of LNG Terminal Application for Delaware River Basin

Jon Hurdle | July 16, 2019 | Energy & Environment
Environmental group accuses regulator of abandoning responsibility to protect water resources

Credit: warrenski/Flickr
A liquefied natural gas carrier
The Delaware River Basin Commission said Monday it is reviewing a request to reconsider its approval of plans for a controversial liquefied natural gas terminal at Gibbstown, Gloucester County.

The interstate water regulator last month unanimously approved the proposed expansion of an energy-export terminal on a former DuPont explosives site in the face of criticism by environmentalists who say the LNG component of the project would risk major explosions, stimulate the production of climate-altering natural gas, and endanger the water resources that the DRBC is required to protect.

The environmental group Delaware Riverkeeper Network previously accused DRBC and other agencies of trying to cover up the plan by Delaware River Partners to transfer LNG produced in Pennsylvania’s Marcellus Shale from trucks or railcars on to ships bound for overseas ports.

Now, DRN has formally asked the commission to re-examine the plan at a public hearing. DRN argues that the LNG terminal would violate the “Compact,” a 1960s document that requires it to protect the basin’s water resources, which would be at risk because of dredging to build the port, and because the project could stir up many contaminants at the site. The critics also say that DRBC failed to consider the views of other agencies when it approved the project and has not given the public enough time to discuss it.

“The DRBC violated its governing Compact and regulations when it approved the project without having full information on impacts on water resources to the Basin,” DRN said in a letter to the commission on July 11.

Abdicating responsibility?

The agency did not include any mention of the LNG plan in its draft docket on the project, known as the Gibbstown Logistics Center, depriving the public of an opportunity to comment, DRN said.

“While the Commission claims that it gave notice based on all that it had from the applicant, this simply abdicates the Commission’s responsibility to the public and its duties under the Compact,” the group said in a 16-page letter.

It also accused the DRBC of failing to address the full scope of impacts including harms to water resources from the construction and operation of the project, as well as its intended use for exports of LNG.

The port developer, DRP, omitted its plans for where LNG operations would take place and what the water impacts would be in its communications with the commission even though it had described the LNG component in a 2017 letter to the U.S. Coast Guard, DRN said.

“DRP is deliberately not providing the commission with full information, and the commission effectively allowed this to continue by approving the project,” DRN said.

In its letter to the Coast Guard, DRP said the terminal will have the capacity to export about 1.67 million barrels of LNG per month.

Rehabilitation of second dock

In May, the company obtained a waterfront development permit from the New Jersey Department of Environmental Protection, allowing the rehabilitation of a second dock at the site to accommodate a transloading operation for liquid products. The standards the applicant must meet under the applicable regulations to qualify for the permit do not consider the specific type of liquid that will be transloaded at the site, DEP said in a statement.

The DEP issued its first permits for a “multi-use deep-water port and logistics center” in April 2017. In August 2018, the company applied to modify existing permits to allow for LNG transloading facilities, the DEP said. At that time, the DEP required DRP to give specific notice of those activities beyond what would have been required by regulations, making the LNG component part of the public record.

The modified permit allows for a dock with two loading platforms, totaling about 140,000 square feet, at the terminal. The permit also authorized dredging of up to 665,000 cubic yards of sediment over 45 acres of the Delaware River.

The company also applied to the DEP to expand underground storage at the site. DEP said it didn’t have the authority to regulate underground storage but would initiate a rulemaking process to establish a permitting process for underground storage operations in the state.

From Marcellus Shale

If implemented, the terminal would link some of Pennsylvania’s abundant natural gas reserves with export markets after years in which development of the Marcellus Shale has been limited by a shortage of pipelines or other capacity to carry the fuel to customers.

Although natural gas, when burned, emits about half the amount of greenhouse gases as coal, its emissions are boosted by production during fracking, and by the leakage of methane, a potent greenhouse gas, critics say.

Peter Eschbach, a spokesman for the DRBC, did not respond to the specific charges made by DRN or say whether the agency will hold a hearing, but said the commission is looking at DRN’s request. “The DRN document we received last week is being reviewed and the issues raised will be considered by the DRBC Commissioners,” he said. He noted that DRBC jurisdiction over the development is limited to dredging and construction of the port.

The commission represents the water interests of the four basin states — New Jersey, Pennsylvania, New York, and Delaware — plus the federal government.

Also on July 11, DRN appealed to the Federal Energy Regulatory Commission over its denial of the group’s request under the Freedom of Information Act to disclose what it knew about the LNG project. The group accused FERC of failing to make a “proper response” to the request and of failing to explain its refusal.

Tamara Young-Allen, a FERC spokeswoman, declined to comment on Monday.

A spokeswoman for Delaware River Partners did not respond to a request for comment on the DRN requests.