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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.

Big Rail Cites Bin Laden, Al Qaeda to Fight Oil-by-Rail Route Transparency

8:21 am in Uncategorized by Steve Horn

oil train

Big Rail done little to halt the very terrorism threats it claims a desire to stop

While many states around the U.S. have released information to the public about the frequency and routes of trains carrying oil obtained from hydraulic fracturing (“fracking”) in North Dakota’s Bakken Shale basin, holdouts still remain.

Why the delay? Homeland security concerns, claim some companies.

In an ongoing Maryland court case over the issue of transparency for in-state oil-by-rail routes, a July 23 affidavit from Carl E. Carbaugh — director of infrastructure security for Norfolk Southern — goes into extensive detail about the supposed risk presented by terrorism attacks on “Bomb Trains.”

In so doing, Carbaugh mentions Al-Qaeda.

“The most recent edition of Inspire magazine, March 2014, the online, English-language propaganda publication of [Al-Qaeda in the Arabian Peninsula], presents a full-page collage depicting varied images…in order to construct an explosive device,” reads Carbaugh’s affidavit.

“Among these images are a derailed passenger train and a partly covered note paper listing cities in the [U.S.] as well as the terms ‘Dakota’ and ‘Train crude oil.’”

Carbaugh also cited Osama bin Laden, the late Al-Qaeda international ring-leader, in his affidavit.

“Among the materials seized in the May 1, 2011, raid on Osama bin Laden’s compound in Abbottabad, Pakistan, were notes indicating interest in ‘tipping’ or ‘toppling’ trains — that is causing their derailment,” Carbaugh wrote.

Jay Apperson, director of communications for the Maryland Department of the Environment (MDE), told DeSmogBlog that no hearing date has been set yet for Norfolk Southern’s legal complaint nor the companion complaint filed by CSXCorporation.

In its lawsuit filed against the Maryland environment department, CSX deployed similar arguments.

Apperson says both lawsuits were redundant because “we reiterated [to both companies] that we would not release the documents under state open records law until the court challenge is resolved.”

MDE filed a response arguing such in July 25 legal motions issued to CSX and Norfolk Southern.

CSX, according to its website, does not even have any oil-by-rail lines running through Maryland.

Like Old Dominion, Like Garden State

Big Rail has used a similar approach in New Jersey, another state that has not yet publicly-disclosed oil-by-rail route information.

Lee Moore, a New Jersey Department of Law and Public Safety spokesman, explained why to The Record.

“Releasing all of the records, which include the rail lines on which Bakken crude oil is being transported, would pose a homeland security risk,” said Moore.

“Clocks and Windows”

William Larkin Jr., a Republican member of the New York Senate, believes the argument put forward in both Maryland and New Jersey is flawed on its face.

“I feel that both the U.S. Department of Transportation and a number of critics seemed to have missed the point, at least the larger point,” Larkin Jr. told the Poughkeepsie Journal on July 20. “[People] already know which rail lines oil companies are utilizing. Clocks and windows provide this information.”

As reported on DeSmogBlog, Big Rail has historically shored up exemptions from “right to know” laws and they have pushed hard to keep it that way.

Security Concerns: Holes in the Story

If the rail companies have serious concerns about terrorism threats to Bakken oil trains, their recent actions call such concerns into question.

Prior to the release of the new proposed oil-by-rail regulations, Big Rail lobbied against any regulations requiring the trains to be attended at all times. And they were successful, as this is not included in the proposed regulations.

Further, Burlington Northern Santa Fe (BNSF) — owned by Warren Buffet, a major campaign contributor to President Barack Obama — is currently in the midst of a stand-off against organized labor. The battle centers around BNSF’s push for single person train operation, trains driven by a one-man ‘crew’ rather than the traditional two member crews.

Other ways experts have suggested to reduce risks of oil trains include lowering speed limits and stripping volatility of the oil prior to shipping via a process called stabilization.

However, prior to the release of the new proposed DOT regulations, the American Association of Railroads and the American Petroleum Institute both said two things should be off the table: train speeds and mandatory stabilization.

“Citizens for Rail Security”

Despite holes in its narrative about national security risks associated with disclosure of oil-by-rail routes, one measure some companies have taken is to create citizen volunteer security groups.

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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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Obama DOE Issues 1st Marcellus Shale Fracked Gas Export Permit

3:59 pm in Uncategorized by Steve Horn

Cross-Posted from DeSmogBlog

LNG carrier ship

Fracking gas from Marcellus Shale may soon be headed overseas.

The U.S. Department of Energy (DOE) has granted the first ever LNG export permit license to Dominion Resources, Inc. to export gas obtained from the controversial hydraulic fracturing (“fracking”) process in the Marcellus Shale basin.

It’s the fourth ever export terminal approved by the DOE, with the three others along the Gulf Coast: Cheniere’s Sabine Pass LNG, Freeport LNG (50-percent owned by ConocoPhillips) and Lake Charles Exports, LLC.

Located in Lusby, Maryland, the Dominion Cove Point LNG terminal will be a key regional hub to take gas fracked from one of the most prolific shale basins in the world — the Marcellus — and ship it to global markets, with shale gas exports a key geopolitical bargaining chip with Russia, the biggest producer of conventional gas in the world.

Dominion owns not only Cove Point, but also the pipeline infrastructure set to feed the terminal.

“Dominion … owns both the existing Cove Point LNG Terminal and the 88-mile Cove Point pipeline,” explained industry publication LNG Global. “Dominion Cove Point … stated in their application that natural gas will be delivered to the Cove Point Pipeline from the interstate pipeline grid, thereby allowing gas to be sourced broadly.”

DOE handed Dominion a permit lasting a generation.

“Subject to environmental review and final regulatory approval, the facility is conditionally authorized to export at a rate of up to 0.77 billion cubic feet of natural gas a day (Bcf/d) for a period of 20 years,” LNG Global further explained.

It’s a decision that is set to affect the course of U.S. energy markets, the global climate system and sensitive ecosystems for decades to come.

With the DOE authorizing Dominion to export gas from Cove Point, Maryland, “it is deeply disappointing to see that Secretary [Ernest] Moniz persists in leading the nation and the world into a dirty energy future. It’s a bad deal all around: for public health, the environment, and America’s working people,” the Sierra Club said in a statement.

“Exporting LNG to foreign buyers will lock us into decades-long contracts, which in turn will lead to more drilling — and that means more fracking, more air and water pollution, and more climate-fueled weather disasters like record fires, droughts, and superstorms like last year’s Sandy…As we have shown, once environmental impacts are evaluated, it becomes clear that the additional fracking and gas production exports would induce is unacceptable.”

“Dominion” means “the act or fact of ruling” and today in the Marcellus it equates to the “golden rule”: he who has the gold makes the rules, in which Marcellus fracked gas will soon flow to the highest bidder on the global market.

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