The companies involved with an effort to make Elba Island a natural gas export facility explained their plans Tuesday night at Savannah Tech.
Poster boards set up around Eckburg Auditorium showed how the current ability to import about 40-50 ship tankers full of LNG a year will be turned around to allow Elba to export about the same amount of gas. Instead of vaporized natural gas flowing inland through pipelines, it will flow to the coast through those same pipelines and be liquefied at the Savannah River facility before being loaded onto tanker ships for export.
Liquefied natural gas, or LNG, is methane that's supercooled, a process that shrinks its volume by a factor of 600, making it practical to ship. Plans call for six to 10 modular liquefaction systems developed by Shell to be built at Elba with LNG being produced there by 2016 at the earliest. Each of the small scale liquefaction plants measures about 35 by 75 meters. The project cost is estimated at $1 billion to $1.5 billion.
Southern LNG operates Elba. Its parent company is Kinder Morgan, which through another of its companies -- Southern Liquefaction Company -- has formed a joint venture with Shell to develop the gas liquefaction plant.
Halfway through the three-hour open house Tuesday about 25 people had visited.
Chatham County Commissioner Tony Center was one of them. He was just gathering information, he said, as he chatted with company representatives. So was Anson Calmes, an emergency management specialist with Chatham Emergency Management Agency, who was assured that reversing the process and adding liquefaction at Elba didn't increase the safety or security risks there.
The congenial tone in the room was in contrast to a previous series of public meetings about plans to truck LNG out of Elba and across DeRenne Avenue for distribution as a vehicle fuel throughout the Southeast. Those contentious plans, drawn up by previous owner El Paso, were withdrawn in late March 2012. And they're not coming back with this new plan, said Richard Wheatley, director of corporate communications/public affairs for Kinder Morgan.
"Trucking is not associated with this project," Wheatley said. "We're going to disassemble the truck-loading scales. (The liquefaction equipment) will be part of that area."
Wheatley couldn't rule out a trucking option re-emerging at some point in the future, but it would require a new application to federal regulators.
"If a customer comes to us in the future and says, 'We really want to do this,' we'd have to go through the FERC process again," he said.
Savannah City Council had objected to trucking LNG. Now the city is content to monitor the new plans, said spokesman Bret Bell.
"We've got nothing against LNG," Bell said. "We just have a problem with LNG on 18 wheels running through Savannah."
Kent Harrington, a downtown resident who co-founded a group opposed to trucking LNG through Savannah also attended the open house. He's not opposed to liquefaction and export from Elba per se, though he'd like to see the U.S. develop a balanced LNG export policy. Closer to home, he's urged Mayor Edna Jackson in a December email to develop a hazardous materials trucking policy before the issue becomes urgent again. She did not reply to his email, he said.
And though he sees nothing uniquely risky in what's proposed now, it is a major investment.
"The city and county need to get ahead of this and work in cooperation with Southern LNG and Kinder Morgan to make sure they're prepared," he said. "A major new investment will bring new needs for emergency services to deal with risk associated with any emergency."
In Elba's 35-year history the U.S. has been a net importer of LNG. But the prospect of pulling from huge domestic shale gas reserves is changing that picture. Despite the environmental concerns posed by hydraulic fracturing -- or fracking -- and the worries that excessive export of LNG could raise prices at home, companies are rushing to get a piece of the export market.
In August, Southern LNG, a subsidiary of Kinder Morgan, joined the queue of what are now 16 facilities requesting permission from the U.S. Department of Energy to export to Non-Free Trade Agreement countries. Elba is 12th in line, and its application is pending. Southern LNG's request followed a similar one granted in June to export to free trade countries.
Tuesday's open house was held as part of a "pre-filing" process with federal regulators. Kinder Morgan and Shell expect to file their application for the liquefaction facility with federal regulators in December. If approved, they could begin construction as early as November 2014.
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