NAM Study Slams LNG, Coal Export Permitting Delays
Federal, state and local permitting reviews of new facilities needed to increase exports of liquid natural gas and coal may run afoul of U.S. obligations under international trade agreements, a new study finds.
Both LNG and coal are now in abundant supply in the U.S., and demand in China and other countries for these resources is growing. Coal provides 70% of the energy consumed in China, the study notes, and more than 395 gigawatts of new coal-fired power generation is planned worldwide by 2016. U.S. natural gas prices are less than half those of Europe, the study points out, and as little as a quarter of prices in Asia.
Global demand is prompting a variety of efforts in the United States to export more coal and natural gas, but NAM officials warn a “persistent pattern” of regulatory delay for energy-related projects such as the Keystone XL pipeline is hampering the U.S. economic rebound and competitiveness.
“We have a unique opportunity to impact global trade and create jobs in the energy space,” said Aric Newhouse, NAM senior vice president of policy and government relations, in a conference call with reporters. He said every delay of months or years in permitting energy infrastructure projects “threatens our ability to grow jobs in this country and threatens our ability to grow the economy.”
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Former WTO Chairman: LNG, Coal Export Permitting Delays May Run Afoul of U.S. Treaty Obligations
NEW REPORT SAYS TABLES MAY BE TURNED ON UNITED STATES IN WTO
Unnecessary delays in the liquefied natural gas (LNG) and coal export permitting process may run afoul of U.S. international treaty obligations under World Trade Organization (WTO) agreements, according to a report by former WTO Appellate Body Chairman James Bacchus.
The report, which the National Association of Manufacturers (NAM) commissioned, examines two central questions:
Do unreasonable delays by the Department of Energy to issue licenses to export LNG to foreign countries constitute, in and of itself, a violation of our international obligations under the WTO?
Do efforts by state and local authorities in the Pacific Northwest to broaden unduly the scope of the environmental review process for planned coal export terminals beyond the federal scope, and the resulting delay, constitute a violation of our international obligations under the WTO?
As a member of the WTO, the United States is bound to comply with trade rules contained in WTO agreements. A key provision, the General Agreement on Tariffs and Trade 1994 (GATT 1994), forbids export restrictions, including those made effective through licenses or other measures. Bacchus concludes that the implementation of U.S. rules in ways that unnecessarily impede exports of LNG and coal likely violate WTO trade rules.
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Opinion: Critics of coal shipments are misinformed
B.C. can’t afford to lose 26,000 jobs supported by the coal industry
The study, by experts such as Dr. Leonard Ritter, Professor Emeritus of Toxicology at the University of Guelph’s School of Environmental Sciences, shows that many complaints by environmental groups and others are misinformed or exaggerated.
The Environmental Impact Assessment states: “The project is not likely to cause significant adverse environmental, socio-economic, or health effects, taking into account the implementation of the main risk mitigation measures described above, in addition to mitigation measures, construction and operation management plans, best management and standard practices.”
These conclusions match our experience in safely transporting coal for over 40 years.
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Vancouver Barge Company Signs On To Coal Project
While Ambre Energy awaits state and federal permits to build a controversial coal export terminal at the Port of Morrow, the company signed a letter of intent with Tidewater Barge Lines for transportation service along the Columbia River.
Tidewater, based in Vancouver, Wash., will operate tugboats and barges needed to move the coal 218 miles down river — if the project receives permits from the U.S. Army Corps of Engineers, Oregon Department of State Lands and Department of Environmental Quality.
The Morrow Pacific project would ship 8.8 million tons of coal per year on covered barges from Boardman to Port Westward, an industrial park located between St. Helens and Astoria. From there, it would load onto ocean-going vessels for export to Asian markets including Japan, South Korea and Taiwan.
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Hear voices of Crow Nation in coal debate
When it comes to developing our energy resources, Montanans have grown accustomed to the federal government getting in the way. But as coal development projects in the state move forward, the latest roadblock is coming from right here in Montana. On a recent visit to the Crow Indian Nation, we learned how local opposition to coal exports is affecting one of the poorest communities in the state.
Some cities along rail routes in Montana are trying to limit coal train traffic, citing concerns about quality of life, traffic congestion and coal dust. At issue are two proposed coal export terminals in Washington that, if approved, would ramp up coal rail shipments from southeastern Montana to the West Coast for export to Asian markets.
Recently, the Missoula City Council passed a resolution asking the U.S. Army Corps of Engineers to expand the scope of its environmental review of the Millennium Bulk Terminal in Longview, Wash., more than 500 miles away. The city council wants the agency to consider the impacts of increased coal rail traffic moving through Missoula. City officials in Helena have also expressed similar concerns over the proposed export terminal.
If successful, the economic consequences of Missoula’s resolution – which ultimately aims to prevent Montana coal from ever reaching a western port – are obvious enough. But as we witnessed on our recent trip with several state representatives to the Crow Nation, such restrictions would be a crushing blow to the impoverished tribe.
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