An Oregon land use appeals board has overturned county and city dredging permits for the Jordan Cove LNG export project, adding to the mounting regulatory obstacles for the already paused natural gas project.
The action comes as the 7.8 million mt/year Jordan Cove LNG project planned for Coos Bay, Oregon, recently paused development, including the related Pacific Connector feedgas pipeline, in order to assess the impact of recent regulatory hurdles.If built, the project would be the first liquefaction facility on the US West Coast, benefiting from a shorter shipping distance to East Asia compared with existing terminals on the Gulf Coast. But Pembina, and the original developer of the project that it later acquired, Veresen, encountered significant challenges over the last eight years in securing regulatory permits and commercial agreements to be able to sanction construction.
Among those regulatory barriers, the US Department of Commerce on Feb. 8 sustained Oregon's objection under the Coastal Zone Management Act, and the Federal Energy Regulatory Commission denied Jordan Cove's effort to have the commission declare Oregon's water quality review waived.
Adding to those challenges, on May 4 Oregon's Land Use Board of Appeals reversed, rather than remanded, local decisions that would have allowed Jordan Cove to widen the existing Coos Bay navigation channel in several protect areas. New dredging is not allowed without an exception to a statewide planning goal for estuary resources, and the appeals board agreed with environmentalist petitioners that local authorities had misconstrued administrative rules governing exceptions.
Asked about the impact of the new land use decision on the project, Pembina reiterated its decision to pause development while it reassesses regulatory hurdles.
"While we continue to believe in the strategic rationale of Jordan Cove, in light of current regulatory and political uncertainty, our decision reflects our steadfast commitment to our financial guardrails, our disciplined and prudent approach to capital allocation, and our commitment to comprehensively mitigating risk on this project," it said in an email May 6. "We are thankful for the incredible support from community members across southern Oregon and the Rockies Basin."
Pembina in April asked the DC Circuit Court of Appeals to hold legal challenges to Jordan Cove's FERC authorizations in abeyance, telling the court it was pausing the project while it considered the regulatory outlook.
Petitioners including Native American tribes, landowners and environmental groups have since objected to the delay in their ability to have their challenges heard in court.
Conservation groups May 3 told the court that the FERC action giving rise to the case remains unchanged.
"[T]he final agency action challenged by conservation-petitioners is ripe for judicial review, regardless of the speculative intention of respondent Intervenors," they wrote, referring to Jordan Cove's stated pause. They noted FERC has not taken steps to pause or reconsider the certificate, nor has Jordan Cove taken steps to surrender the certificate or relinquish other approvals.
Landowners also argued that even if Jordan Cove cancels the project, as a practical mater the certificate's eminent domain authority continues in force "indefinitely" unless FERC were subsequently to vacate the certificate. "While the project may be on hold, so are the landowners' lives and plans for their property. ..[F]urther delay means further irreparable injury to people who have had this company threatening to take their property since 2005."
The latest land use reversals were welcomed by environmental groups as "further major barriers" to the project. "[The board] has upheld the regulations that protect estuaries in Oregon, and we don't think the Jordan Cove scheme can get around them," said Phillip Johnson of Oregon Shores Conservation Coalition, in a press statement.
