LNG developer pulls the plug on Bradwood Landing project

Bradwood Landing was an industrial site from 1856 until 1965. It housed a lumber mill, company town and deep water port.Ending a six-year effort that consumed as much as $100 million, countless hours of regulatory work, and engendered a firestorm of public opposition, NorthernStar Natural Gas said this afternoon that it was suspending efforts to develop a liquefied natural gas import terminal at Bradwood Landing on the Columbia River, 25 miles east of Astoria.

The Houston based energy development company sent out a one-page news release this afternoon quoting NorthernStar president Paul Soanes saying "the extended delays in the processing of state and federal permits for Bradwood Landing and the difficult investment environment have forced us to suspend development." 

The company characterized its move as a “suspension” of the project, not a termination.

Mike Carrier, Gov. Ted Kulongoski’s natural resources policy director, said the company told him today that another developer could conceivably resurrect the effort. But Carrier said that NorthernStar told him that its investment backer, a private equity fund that has put $100 million into the company’s LNG development efforts in Oregon and California, is pulling the plug.

Project opponents celebrated Bradwood’s announcement.

“It’s a huge victory for Oregonians, for familty farms, for clean water, for salmon habitat, for fisherman,” said Brett Vandenheuvel, executive director of the conservation group Columbia Riverkeeper. “LNG has no placer in Oregon, not only Bradwood Landing but the other two LNG terminals are not viable projects in Oregon either. 

Two other companies are in federal and state permitting processes for LNG terminals in Oregon. One just west of Astoria on the Columbia River and the other in Coos Bay. Those projects are also competing with a new pipeline that would import more gas from Wyoming to Oregon and California.

NorthernStar began development work nearly six years ago on the project, at a time when gas prices were high and the importation of natural gas to the United States from abroad seemed like a lucrative opportunity.

In addition to regulatory delays, NorthernStar’s investors were doubtless focusing on the fact that domestic reserves of natural gas have soared with the use of new drilling techniques to access unconventional shale reserves, and the price of gas has plummeted with the recession

Bradwood suspension also has implications for a controversial 200-mile pipeline that NorthWest Natural Gas Co. and TransCanada were planning to build to connect the LNG terminal with an interstate pipeline in Central Oregon, near Madras.

Neither company returned calls this afternoon.