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Judge Nixes Cove Point LNG Zoning Permit as Dominion Says Will Soon Receive Federal Permit

10:50 am in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Co-Written with Caroline Selle

Environmental groups fighting against the Cove Point LNG export terminal hailed Salmon’s judgment as a major grassroots victory.

An August 6 court decision handed down by Calvert County Circuit Court Judge James Salmon could put Dominion Resources’ timeline for its proposed Cove Point liquefied natural gas (LNG) export facility in jeopardy.

Salmon ruled that an ordinance exempting the Lusby, Md.-based LNGproject from local zoning laws — Ordinance 46-13 — violated both a section of a state Land Use law, as well as Maryland’s constitution. The facility will be fueled by gas obtained via hydraulic fracturing (“fracking”).

In the ruling, Judge Salmon described the zoning exemption as “a very unusual situation.” In 2013, the Calvert County Board of County Commissioners and the Calvert County Planning Commission carved out both LNG export and import facilities from zoning laws.

“To my knowledge no other municipality or county in Maryland has attempted to do what the Calvert County Board of County Commissioners has attempted to do, i.e. completely exempt two uses from being covered by zoning regulations while requiring everyone else in the County to abide by those regulations,” wrote Salmon.

Environmental groups fighting against the Cove Point LNG export terminal hailed Salmon’s judgment as a major grassroots victory.

“At a minimum, this ruling will likely cause real delay in the ability of Dominion to begin major construction of this controversial $3.8 billion fossil fuel project,” Mike Tidwell, executive director of Chesapeake Climate Action Network (CCAN), said in a press release. “The ruling should certainly give pause to the Wall Street investors that Dominion is seeking to recruit to finance this expensive, risky project.”

The plaintiffs in the lawsuit, AMP Creeks Council (shorthand for Accokeek Mattawoman Piscataway Creeks Council), came to a similar conclusion.

“This is a remarkable victory for the people of Lusby, Maryland, and folks fighting fracking and LNG exports throughout the Mid-Atlantic region,” Kelly Canavan, President of AMP Creeks Council, said in a press release.

Yet, Salmon concluded the ruling out by stating his decision “has no direct bearing on whether the facility will be built or not.” And even AMP Creeks acknowledged in its press release that its legal team “is still sorting out the implications of this ruling.”

Further, Canavan told DeSmogBlog in an interview that she agrees with Salmon, at least in terms of the legal argument he put forward about his role in the final destiny of the Cove Point LNG export facility.

“Even if he wanted to, he does not have the power to determine whether or not the facility will be built,” she said. “It doesn’t mean there won’t be a ripple effect.”

So, what gives? Is the decision a game-changer or something less? Dominion certainly thinks the latter, based on a review of its quarter two earnings call transcript.

Dominion Expects Federal Permit in “next few weeks”

During his company’s quarter two earnings call held prior to Salmon handing down the Calvert County ruling, Dominion CEO Thomas Farrell II told those listening that he expects to receive a final LNG export license from the U.S. Federal Energy Regulatory Commission (FERC) in the “next few weeks.”

“We expect to receive FERC order approving the project in the next few weeks and begin construction shortly thereafter,” Farrell said on the call. “The Cove Point Liquefaction is expected to begin operations during the fourth quarter of 2017.”

Canavan believes Farrell’s rosy prospectus appears unlikely, however.

“We obviously disagree with that, partly because if it wouldn’t delay the project to have to go through these processes, there wouldn’t have been any need to pass the ordinance in the first place,” she said.

Calvert County Board, Dominion React

In the aftermath of the ruling, Dominion made a statement, appearing to stand by its quarter two investor call. “We are reviewing the decision in detail and do not see any schedule impact,” said the company in a press release.

Meanwhile, the County Board stood by its original decision to offer Dominion a zoning exemption, saying Salmon’s ruling would be discussed at its then-upcoming August 19 meeting.

“[T]he premise behind the zoning exemption remains legitimate,” said the Board in a collective statement offered to the press. “It recognizes that review and inspection of these types of highly technical, stringently regulated projects should be conducted by experienced federal and state regulators due to the rigorous standards they must meet.”

A DeSmogBlog review of meeting minutes for that date and for the upcoming August 26 meeting shows the topic was never put on the agenda, though.

Which leaves us where we started: what’s the future of the prospective Cove Point LNG terminal? Your guess is as good as ours.

Documents: MD County Housing First East Coast LNG Export Facility Signs Non-Disclosure Deal

1:48 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

Co-authored by Steve Horn and Caroline Selle

DeSmogBlog has obtained documents revealing that the government of Calvert County, MD, signed a non-disclosure agreement on August 21, 2012, with Dominion Resources — the company proposing the Cove Point Liquefied Natural Gas (LNG) export terminal in Lusby, MD. The documents have raised concerns about transparency between the local government and its citizens.

The proposal would send gas obtained via hydraulic fracturing (“fracking”) from the Marcellus Shale basin to the global market. The export terminal is opposed by the Chesapeake Climate Action Network, Maryland Sierra Club and a number of other local environment and community groups.

The Accokeek Mattawoman Piscataway Creeks Council (AMP Council), an environmental group based in Accokeek, MD, obtained the documents under Maryland’s Public Information Act and provided them to DeSmogBlog.

Cornell University’s Law School explains a non-disclosure agreement is a “legally binding contract in which a person or business promises to treat specific information as a trade secret and not disclose it to others without proper authorization.”

Upon learning about the agreement, Fred Tutman, CEO of Patuxent Riverkeeper — a group opposed to the LNG project — told DeSmogBlog he believes Calvert County officials are working “in partnership with Dominion to the detriment of citizen transparency.”

“We’re unhappy that it does seem to protect Dominion’s interest rather than the public interest,” Tutman said. “The secrecy surrounding this deal has made it virtually impossible for anyone exterior to those deals, like citizens, to evaluate whether these are good transactions or bad transactions on their behalf.”

Details of the Non-Disclosure Agreement

The six-page non-disclosure agreement explains Calvert County “desires to participate in discussions regarding Calvert County property tax credits. During these discussions, [Dominion] may share certain proprietary information with the [county].”

What’s confidential? According to the non-disclosure agreement,

… any data or information…not generally known to the public, whether in tangible or intangible form, and meeting the requirements for mandatory denial of inspections pursuant to the Maryland Public Information Act…whenever and however disclosed, including, but not limited to: (i) marketing strategies, plans, financial information, or projections, operations, sales estimates, business plans and performance results relating to the past, present or future business activities of such party, its affiliates, subsidiaries and affiliated companies; (ii) plans for products or services, and customer supplier lists; (iii) any scientific or technical information, invention, design, process, procedure, formula, improvement, technology or method; (iv) any concepts, reports, data, know-how, works-in-progress, designs, development tools, specifications, computer software, source code, object code, flow charts, databases, inventions, information and trade secrets; and (v) any other information that should reasonably be recognized as confidential information of [DCP].

In a statement provided to DeSmogBlog, Calvert County Commissioner Evan K. Slaughenhoupt, Jr. said it would be the “height of naiveté” to think a government would not sign a non-disclosure agreement in this type of situation, given the stakes involved.

“When businesses have contractual concerns, and meet with elected officials in a lawful duly authorized executive session to discuss expansion of a business, I honor my responsibility to not convey what was discussed in such a session,” he said. “Citizens expect no less of that from us.”

Non-Disclosure Agreements “Normal Part of Negotiations”

The use of non-disclosure agreements by local governments is not unprecedented. Some cases in point:

Queried about Dominion’s non-disclosure agreement with Calvert County, Dominion spokesman Jim Norvelle told DeSmogBlog such agreements are “a routine, normal part of negotiations involving multi-billion dollar economic development projects.”

“Companies and counties often use non-disclosure agreements because they each need to share business-sensitive, confidential information that cannot be shared with other businesses or counties for competitive reasons,” Norvelle said. “The result this time around is certainty for both Dominion and the county.”

U.S. Congressmembers Decline Comment

Asked for comment on the agreement on multiple occasions by DeSmogBlog, Maryland’s U.S. Senators Ben Cardin (D) and Barbara Mikulski (D) declined to comment, as did U.S. Rep. and Democratic Party Whip Steny Hoyer.

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