EPA issues favorable ruling for Puerto Rico LNG project

Aguirre Offshore GasPort LLC had a good piece of news to pass along on May 14 to the Federal Energy Regulatory Commission, saying that the U.S. Environmental Protection has given its liquefied natural gas import project, combined with a power plant fuel change, a qualified bye when it comes to air permitting.

Aguirre in recent months has been seeking FERC approval for an LNG import project in coastal Puerto Rico, just offshore of the oil-fired Aguirre power plant of the Puerto Rico Electric Power Authority (PREPA). The authority wants to add natural gas capability at the power plant to reduce its dependence on costly imported oil and reduce the power plant’s air emissions.

In September 2013, PREPA submitted to EPA a Prevention of Significant Deterioration non-applicability analysis for project. EPA on May 6 sent back a letter to PREPA and Aguirre Offshore noting that PREPA is proposing to convert its existing boilers and combined-cycle turbines at its Aguirre Power Complex from exclusively burning No. 6 and No.2 fuel oil, respectively, to burning natural gas and fuel oil as backup. In order to supply the natural gas to the Aguirre Power Complex, Aguirre Offshore parent Excelerate Energy LP is proposing to develop, construct, and operate the Aguirre Offshore GasPort which will be constructed approximately 6 kilometers offshore.

Excelerate will own and operate the Floating Storage and Regasification Unit (FSRU) that will be moored permanently at the GasPort (except during maintenance or an approaching hurricane) and provide the gasification services to PREPA.

“Based on the information provided, it appears that the proposed modifications at the PREPA Aguirre Complex together with the construction and operation of the Aguirre Offshore GasPort and its FSRU will not be subject to PSD provided that, at the minimum, the attached permit conditions are included in the Puerto Rico Environmental Quality Board (PREQB) construction permits for both the Aguirre Power Complex and the GasPort,” said the EPA letter. “If, however, these conditions are not included or are included in modified form, EPA may be required to re-evaluate the applicability of the PSD regulations to the project relative to the new circumstances. Please also note that this assessment does not constitute a final agency action.”

Also, in determining the C02e emissions of this proposed project, the September 2013 PREPA submittal relies on global warming potentials (GWPs) that have been superseded as of Jan. 1, EPA added. “Therefore, the CO2e emissions from this proposed project must be recalculated using the revised GWPs and the revised CO2e emissions must be sent to PREQB with a copy to EPA. EPA, however, does not expect a change in the PSD non-applicability conclusions as a result of this update.”

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.