The Jordan Cove LNG project has finally been scrapped, as the project’s developers – Pembina Pipeline Co – announced to FERC that it had canceled its plans for both the terminal as well as a connecting pipeline called the Pacific Connector.
The LNG project was first announced in 2007, and initial expectations were that the terminal could be the first LNG facility on the West Coast. Its geographic proximity to Asia would give it an advantage over terminals in the Gulf Coast in supplying demand zones in Japan and Korea.
Ships from Gulf facilities usually are forced to make days-long journeys through the Panama Canal, the Suez Canal, or around the Cape of Good Hope in order to access these foreign markets.
A West Coast terminal had the potential to decrease the travel time of ships to Asia, potentially saving hundreds of thousands of dollars in shipping costs (as a reference, charter rates are currently ~$260,000/day).
Eventually though, after years of battle with environmental groups and landowners, the terminal acknowledged defeat to its opponents. Given that this terminal has been in the works for nearly 13 years, hope for the completion of the project was lost years ago – this announcement was expected to arrive for quite some time in fact.
The cancellation of this project further reaffirms the fact that though superior, economically advantaged paths exist for easier, faster transfer of LNG to abroad markets, the Gulf Coast remains the only location in the U.S. where projects can be built without significant opposition.
There will be few efforts in the future to build another terminal on the West Coast given the long-drawn-out demise of Jordan Cove.
Source: Gelber and Associates