Monday, March 06, 2006

Long Beach Study: LNG good for CA

An economic impacts study of the proposed Long Boeach liquefied natural gas terminal reveals positive impacts for California...with one caveat.

The operator of a proposed liquefied natural gas terminal in the Port of Long Beach unveiled an economic impact analysis Thursday that showed the facility, if built, would increase the West's supply of natural gas by nearly 11 percent, decrease consumer prices by more than 7 percent and create 223 new high-paying jobs.

But rhetoric surrounding the proposal has flared over the economic impact the LNG supply depot would have on ailing city coffers.

The economic impact report unveiled Thursday was prepared by Cal State Long Beach economics department chairman Joseph Magaddino for Sound Energy Solutions, a Mitsubishi Corp. and ConocoPhillips subsidiary that is proposing the terminal on the port's Pier T. The report concluded that the terminal would also generate $10.3 million in tax revenues to the city, and nearly $8 million annually in state income taxes.

Construction impacts would be even higher, with 400 annual jobs created and a $100 million payroll while it was being built.

The problem with this analysis, though, is that it could apply to any LNG terminal, and does nothing to bolster the case for Long Beach.