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Proposal for natural gas terminal

BY TOM INCANTALUPO | STAFF WRITER

January 27, 2006

Private investors detailed plans yesterday to create a $1 billion man-made island 13.5 miles south of Long Island to receive tanker shipments of liquefied natural gas that they said would help keep prices from rising.

Officials of the Manhattan-based and privately held Atlantic Sea Island Group - which declined to disclose the names of its investors - said the facility would help keep gas prices under control by increasing the supply of imported gas in this region. They said they hoped to have the terminal in operation by 2010, pending federal and state approval.

"The gas has to come from abroad and if we don't have terminals, the gas is going to go to our competitors," said company chairman Howard Bovers, referring to nations such as Japan that buy imported gas.

The investors started off on the wrong foot, though, with the community that would be closest to the terminal. The city of Long Beach, where officials were miffed about not being told about a news conference to announce the plan even thought it was held on their boardwalk. A statement attributed to City Council president Leonard G. Remo said, "We all know that the goal of reducing energy costs in the Northeast is important to our residents. However, a liquefied natural gas terminal ... in proximity to our barrier islands may not be the best solution to this problem."

Local environmentalists also weren't enthusiastic. "My initial reaction is we have grave and serious concerns about paving over the ocean and treating it like commercial real estate," said Adrienne Esposito, executive director of the Citizens Campaign for the Environment, a statewide group based in Farmingdale.

The facility would be one of at least 24 liquefied natural gas terminals onshore and offshore being proposed around the country, but officials said it would be the first in the world built offshore on an island rather than on a floating platform.

The island, covering 50 to 60 acres, would be built in 60 feet of water out of dredged sand and rock and would be barely visible from shore, proponents say, even on a clear day. Four storage tanks on the island would hold as much as 16 billion cubic feet of gas. An average of fewer than one tanker a day - 200 to 220 a year - would unload the liquefied gas, which would be reconverted to a gas and piped ashore.

Bovers said one option for piping is to tie into an existing pipeline running from New Jersey to Long Beach that supplies KeySpan Energy, which in turn sells gas for heating and cooking and uses more to generate electricity. KeySpan spokesman Jody Fisher said the utility hadn't taken a position yet on the Atlantic proposal.

Atlantic Sea Island officials sought yesterday to distance their project from another proposal for a liquefied gas terminal near Long Island - that of Houston-based Broadwater Energy, which wants to site a floating 1,200-foot-long facility in Long Island Sound about halfway between Wading River and New Haven, Conn.

That proposal has drawn strong criticism from environmentalists and politicians on both sides of the Sound as a potential eyesore, navigational hazard and environmental and security risk. Broadwater is planning next week to file its formal application to the various federal and state agencies that must approve its plan. It hopes to have final approvals next year and have its terminal in operation by the end of 2010.

Atlantic officials implied their project would be safer because it would be farther offshore, away from shipping lanes and fixed rather than floating.