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Posted on Thu, Oct. 20, 2005

PGW's LNG deal is dead

Developer of waterfront storage site has pulled out


City Councilman Frank DiCicco has raised major doubts about the future of a plan to ship hazardous liquefied natural gas through Philadelphia, telling residents flatly that the most likely developer has pulled out of a deal.

"There is no deal," DiCicco told a forum last night in South Philadelphia about PGW's plan to bring tankers filled with LNG up the Delaware River to Port Richmond.

It's been common knowledge that PGW has fallen months behind in its schedule for reaching agreement with an energy company to develop and run the LNG terminal.

But DiCicco said Hess LNG - the company believed to be negotiating with PGW - had found the project to be "a tough sell" in Philadelphia. He said he and Councilman Jim Kenney offered little encouragement to Hess officials at a recent meeting, given the growing opposition along the Philly waterfront.

After that meeting, said DiCicco, "Hess pulled out of the deal. So in reality, there is no LNG tanker that will come up our river, presently."

A PGW spokesman said afterward, however, that he understood the gas company was still negotiating with the same company it had been working with on the project. PGW has never publicly confirmed that company is Hess.

"At this point, as far as I know, negotiations are ongoing," said PGW spokesman Doug Oliver.

Mayor Street and PGW are touting LNG imports as a way to help hold down soaring gas bills in the city.

Technically speaking, there never has been a deal. And PGW has filed no plans with the Federal Energy Regulatory Commission or the Coast Guard for its plan to import 37-million-gallon shipments of LNG in massive tankers three or four times a month.

The federal agencies say LNG shipments generally face the "credible" though unlikely possibililty of a terrorist attack. An attack on an LNG ship, experts say, might unleash a pool of fire on the water with heat intense enough to blister the skin of people caught outdoors a mile away.

In Philadelphia, PGW's negotiations with the company that PGW has refused to identify have fallen so far behind schedule that city Gas Commission officials have been demanding to know when the project will get off the dime.

Last night DiCicco told 50 people attending a forum sponsored by the Bella Vista United civic association that he understood legal complications were discouraging Hess from going ahead in Philadelphia, "in addition to the public outcry."

Those complications are believed to involve an LNG terminal in Fall River, Mass.

DiCicco, who represents the city's river wards from Bridesburg to South Philadelphia, maintained that with Hess allegedly backing off, "there is no supplier that would be interested." He acknowledged the picture could change and said he would schedule public meetings if a plan moves forward.

City police and fire officials made reference to the unsettled status of the PGW project in discussing their intention to look at the risks and the tactics that would be needed to deal with them.

First Deputy Police Commissioner Patricia Giorgio-Fox said it would be "premature" to come up with specific plans "when we're pretty much under the impression that currently we don't need to do that."

And Deputy Fire Commissioner Ernest Hargett said fire officials have started looking at the risks and concerns "even though it looks like the PGW proposal may not be going anywhere."

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Last modified: 22 October 2005

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