LNG Projects Bolstered in SoCal

Two Liquified Natural Gas (LNG) Port proposals were bolstered this week in Southern California.

In Long Beach, the Mitsubishi-Sound Energy proposal found a partner-in-crime in Conoco:

Sound Energy Solutions plans to partner with gas and oil giant ConocoPhillips to build and operate a proposed liquefied natural gas terminal in the Port of Long Beach.

The companies, which announced an informal agreement on Tuesday, have a jointly operated LNG facility in Kenai, Alaska.

The move gives SES a major distribution partner and it puts ConocoPhillips in position to own four LNG facilities in the U.S.

"It's strategically important to us,' said Linsi Crain, a spokeswoman for Houston- based ConocoPhillips, which also operates oil refineries in Wilmington and Carson.

The proposed 27-acre LNG receiving terminal, planned for Pier T at the port, would have the capability of sending out 700 million cubic feet of gas per day. It would be the first such facility on the West Coast. If approved, it would become operational by 2008.

Having an Alaskan source of energy removes one hurdle, but potentially raises another. The Mitsubishi plan is now less reliant on Indonesian sources for its LNG supplies--thereby minimizing terrorism concerns and reliance on OPEC. However, the Jones Act prohibits foreign ships from carrying LNG from one US port to another...and there are currently no US-flagged tankers.

Up the coast in Ventura County, the Australian Cabrilo Port proposal received backing from the Ventura County Economic Development Association (VCEDA), which urged Oxnard City Councilmembers to step back before announcing their opposition to the project 22 miles off its coast. The Ventura Star reports, registration required.