New Fortress LNG Project Recommended by DRBC Hearing Officer

Jim Willis
Editor & Publisher, Marcellus Drilling News (MDN)


There may be no crying in baseball but there certainly is in game played by the Delaware PovertyKeeper with the New Fortress LNG project, which has failed.

In May the Delaware River Basin Commission (DRBC) held a virtual public hearing on the issue of the DRBC’s prior decision to approve construction of a dock in the Delaware River that will allow New Fortress Energy to load LNG tanker ships with LNG transported to the dock from a new liquefaction plant being built in northeastern Pennsylvania . Both New Fortress and the radicals at THE Delaware Riverkeeper were given time to make their case for and against. The hearing officer (i.e. judge) recently announced his decision.

The hearing officer announced he thinks the dock should get built. His report (below) will go to the full DRBC for consideration. Both sides have 20 days to provide further comment. The full DRBC can accept the hearing officer’s recommendation, reject it, and/or do just about anything it wants to do.

Even though the DRBC commissioners are under the bullying thumb of THE Delaware Riverkeeper, the smart money says the commission will uphold and reaffirm their earlier decision to approve this project. Which is why (in our opinion) Riverkeeper recently changed strategies and is now trying to lure local towns located along the transportation route into the illegal action of banning trucks and trains carrying LNG. Here’s the news from Kallanish Energy:

An adjudicatory hearing officer has recommended that Delaware River dock to serve a liquefied natural gas export terminal in New Jersey should remain as approved, Kallanish Energy reports.

The report was filed last week by hearing officer John D. Kelly on the project by developer Delaware River Partners, a subsidiary of New Fortress Energy LLC.

The parties involved have 20 days to object to Kelly’s findings, before the report and any objections go to the Delaware River Basin Commission, which can accept or reject Kelly’s findings.

There is no schedule for the commission to act on his recommendation, said the government regulatory agency that oversees the Delaware River.

Critics had argued that the commission in June 2019 did not allow enough time for public comment in approving the project that would allow two tankers to dock at Gibbstown on the Delaware River in New Jersey’s Gloucester County and the project should be reconsidered.

Kelly said the Delaware Riverkeeper Network made its arguments against the approval, but “the effort and evidence were insufficient to carry the burden.”

The evidence “has not demonstrated any substantial impairment or conflict with the plan for Dock 2 Project,” he said in the conclusion of his 102-page report.

“Accordingly, it is recommended that the Dock 2 Docket should remain as previously approved by the commission,” Kelly said.

Kelly had directed a seven-day hearing on the matter last May.

The LNG that would be loaded onto the tankers would come from the Marcellus Shale in northeast Pennsylvania under the New Fortress plan

It would be moved by truck and rail about 200 miles to the New Jersey site.

The company has gotten a special federal rail permit to be allowed to move LNG by rail in specially designed rail cars.

Construction started last fall at a New Fortress liquefaction plant in Wyalusing, Pennsylvania. It is expected to be operational in late 2020 or early 2021.

New Fortress has said it has signed a 15-year contract with unnamed producers to acquire all the needed feed gas in Bradford County.

The company has plans for a second facility in Pennsylvania. It would be operational in first quarter 2021.

Each plant would produce 3.6 million gallons of LNG per day or 2.15 million tons of LNG per year.

A copy of the hearing officer’s report may be found here.

Editor’s Note: Some of the discussion in the hearing examiner’s report on the New Fortress LNG project by Delaware River Partners (DRP) is quite interesting:

Given the fact that the Commission is required to approve a project unless it impairs or conflicts with the Plan, an entity asking the Commission to alter a Docket approval may prevail if, and only if, it proves that a substantial impairment or conflict with the Plan is in fact presented by the project

DRBC Staff posits that to substantially conflict with or impair the Plan, a project in the Estuary would need to imperil or reverse the trend of improvement that the Basin has seen in its water quality since the birth of the Commission. Neither party presents any compelling reason to find fault with the Staff’s proposed working definition.

Before applying this definition to the evidence in this case, it is essential to note that, as to whether DRN has borne its burden of proving a substantial impairment or conflict, DRN’s own Brief effectively admits failure, stating, “[t]here is simply insufficient data on key impacts to make a determination as to whether the Dock 2 Project will substantially impair or conflict with the Comprehensive Plan.” DRN goes on to fault the Commission for having approved the Project without sufficient data, and thereby argues that the Docket should be “overturned” because it was “contrary to law and an abuse of discretion.”

DRN makes an impassioned argument that the language of the Compact implicitly allows for a second basis to determine that a Project should not be approved, which basis is an insufficiency of information in a Docket application. DRN argues that the Commission’s consideration of a Docket application should be more nuanced than a formulaic approach in which a collection of State and Federal agency approvals will equal success. DRN argues that “context matters” in terms of such factors as “where the project is located” and “existing River conditions.” It further argues that “data … matters” and that “assumptions are not evidence of lack of harm ….”

While DRN’s assertion is well-argued, it is fatally flawed in light of the fact, which DRN expressly acknowledged in filing its Request for Hearing, that this proceeding takes place exclusively under Section 3.8, the language of which provides one and only one basis for reversal of a Docket decision – a preponderance of evidence that a previously approved Docket will, in fact, substantially impair or conflict with the Plan. DRN simply cannot create from whole cloth a new regulatory basis for Docket disapproval. As DRP argues, to allow DRN to do so would effectively allow it to usurp the role of the Commission…

DRN has presented a great deal of testimony and expert speculation as to what might happen to water quality if DRP proceeds with the project. However, given the use of the word “would” in Section 3.8 instead of “might,” it was DRN’s burden to prove probabilities or expectations of substantial impairment or conflict. Accordingly, for purposes of the instant Report of Findings and Recommendations, it was DRN’s burden to prove reasonable probabilities or expectations that the Dock 2 Project may reasonably be expected to substantially impair or conflict with the Plan if permitted to proceed

What DRN argues is that it has adduced proof that the Dock 2 Project may impair the Plan, not that it would. Under the language of Section 3.8, DRN’s arguments for more information do not prove that the Dock 2 Project would impair the Plan. While the information that DRN demands might certainly provide further enlightenment to the Commission about potential environmental concerns arising from the work, the lack of such information is not proof sufficient to allow the reversal of the Dock 2 approval…

As with many of its other arguments, DRN’s concerns about what “could-be” do not reflect the language of the Compact or satisfy the “would-be” standard by which a project may be denied approval. As to the argument that DRBC made unsupported “assumptions” about the Project’s compliance with water quality standards, the quoted term is used an unfair and pejorative manner. The “assumption” that DRBC made was not about water quality data, but about the reasonably expectable exercise by NJDEP and other agencies of their duties to protect environmental conditions charged to their care. DRBC appears to have reasonably assumed that if some part of the Project failed to meet some requirement or regulation enforced by a federal or state environmental agency, such agency would not approve the applicable permit. DRBC’s disinclination to duplicate the work of other agencies or to doubt their integrity was a reasonable exercise of its discretion under Section 3.8.

What this discussion reveals is that speculation of the sort the Delaware PovertyKeeper a/k/a Riverkeeper Network (DRN) and the Commission itself is applying in the case of the proposed DRBC fracking ban simply doesn’t cut it. Facts and proof are the standard. And, the DRBC’s arguments about deferring to state agencies are equally ironic in light of that proposed ban.

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1 thought on “New Fortress LNG Project Recommended by DRBC Hearing Officer

  1. It is very gratifying to see the “truth” take lead in this case. The insufficient materials on impacts is the basis of this case / also the basis of Norse Energy vs. Town of Dryden and every other township that placed a ban. Could the insufficient data be the basis for NYS opening to Fracking? Lets hope so.

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