Leucadia's Oregon LNG Proposal Withdrawn


By MarEx 2016-04-18 20:47:33

On Monday, Leucadia National Corporation formally withdrew its Oregon LNG proposal in Astoria, Oregon. It did not explain the reasons behind its decision, but the announcement coincided with strong local opposition and a deteriorating global business environment for LNG producers.

"The Oregon LNG Project today announced it is ceasing operations immediately," the venture said in a press release. "Leucadia . . . has made the decision to cease funding the project." 

The firm thanked its supporters, and said that it would have no further comment. 

Oregon LNG, like other planned LNG projects along the coast, has been a source of intense controversy in Oregon, pitting investors, job-seekers and economic development interests against environmental activists and local residents. The project had been attempting to make its way through the phases of planning and regulatory approval over the past decade, but it hit a final roadblock in March when a city hearings officer chose to deny it permission to build. With today's announcement, the firm has decided not to appeal the city’s decision. 

Environmental groups like Columbia Riverkeeper hailed it as another victory in ongoing local attempts to stop fossil fuel exports. “This is yet another huge victory for clean water and our climate,” said Brett VandenHeuvel, the group's executive director. Working with other organizations, Columbia Riverkeeper also contributed to the effort to halt the Bradwood LNG project near Astoria in 2010.

Down the coast, the similarly controversial Jordan Cove LNG project recently lost its bid for federal permission to use eminent domain to build a supply pipeline and a liquefaction facility. The Federal Energy Regulatory Commission (FERC) cited an absence of documented market demand for Jordan Cove’s product in its decision. Jordan Cove LNG and its affiliated pipeline infrastructure partner have since acquired expressions of interest from potential customers, and on April 11, it filed a new request for a rehearing with FERC. 

With Oregon LNG's announcement Monday, Jordan Cove LNG has become the only active proposal for an LNG export terminal on the West Coast – compared with roughly 20 plants proposed or under construction on the U.S. Gulf Coast and East Coast.