Regional LNG: US Energy Secretary stresses need for LNG projects: Report

In the wake of a protest by state regulators over permitting jurisdiction, U.S. Energy Secretary Spencer Abraham on Friday met with state and energy industry representatives in Los Angeles to discuss governance and safety of liquefied natural gas, or LNG, projects, Dow Jones reported Saturday.

Talks focused on permitting issues, on ensuring LNG terminals are safe, and on how to make the public aware of safety issues, Abraham told reporters after the meeting.

Residents who live near proposed LNG terminals are often concerned about safety, and more so in light of last month's explosion at an LNG complex in Algeria that killed 23 people. Protests against a proposed LNG plant in Long Beach, Calif., have picked up since that incident, local media have reported. "(The Energy Department's) goal is to minimize safety challenges and address problems," Abraham said. "We want to make sure if there are safety challenges we preemptively and proactively address them and at the same time build public confidence."

Abraham met with representatives of Royal Dutch/Shell Group, Sempra Energy, Calpine Corp., Mitsubishi Corp., ChevronTexaco Corp., BHP Billiton, Crystal Energy, the Port of Alaska, and the state of California, he said.

The energy secretary's visit followed a filing to federal regulators this week by the California Public Utilities Commission saying that the state agency has authority to review LNG proposals - including a plan by Mitsubishi to build a $400 million terminal in Long Beach, the Los Angeles Times reported Thursday.

The move could presage a clash between the state agency and the Federal Energy Regulatory Commission, who sparred during the energy crisis over jurisdictional issues.

Recent results from a survey commissioned by the Department of Energy show a great need for more natural gas in the U.S, Abraham said. Because of pipeline limitations, it would be "optimal" for some of those projects to be built on the West Coast, Abraham said.

"In terms of imports, the goal is to diversify where we bring gas from," Abraham said. "One goal is to bring it from Indonesia and Australia to the West Coast."

The department's natural gas survey suggested a need to build at least nine more LNG terminals in North America in the next 20 years. Currently, there are four operating terminals; none are on the West Coast. (*)