Governor Blanco calls on industry to produce environmentally sound LNG strategy

Release Date: 05/09/2006

BATON ROUGE, LA--Today, Governor Kathleen Babineaux Blanco announced her decision to deny the Freeport McMoran application for new liquefied natural gas facilities off the coast of Louisiana. As she has consistently stated over the past two years, Louisiana stands ready to encourage the development of this growing industry. However, we must have sound scientific evidence to show that these emerging technologies will not seriously harm our already fragile Gulf ecosystem or the fisheries that are so crucial to our fishing industry.

"After considerable consultation with biologists, conservationists, business developers, and Governor Bob Riley of Alabama and Governor Haley Barbour of Mississippi, I have come to the conclusion that insufficient evidence exists at this time to approve this application for an open rack vaporizer (ORV) system. The Freeport McMoran application is only one of many pending LNG projects. We must avoid the harm presented by the cumulative impact of multiple offshore LNG facilities," said Governor Blanco.

"I insist on two conditions that must be met in order to move forward with LNG expansion.

First, until reliable data on the ORV systems is produced, I will only support offshore LNG terminals using a closed loop system known to have negligible impacts to marine life. This was my longstanding and well-documented position to the industry.

Second, I will insist on Louisiana receiving a share of the revenues gained from LNG projects. This is only right. Louisiana has learned a tough lesson in not receiving a share of offshore revenues from the oil and gas industry. We cannot make the same mistake. I am asking the LNG industry to engage in revenue sharing with the coastal producing states from the outset.

I take my role as a steward of Louisiana's natural resources and public trust seriously. I also take seriously my efforts to expand industry investment in our state. We must maintain the delicate balance between protecting the environment and exploring economic opportunities. Today's decision did not come lightly but it did come with clarity. It was the right decision.

I look forward to working with the LNG business community as the technology evolves. I urge Freeport McMoran and others in the LNG industry to apply using the environmentally sound closed loop system. We see these closed loop systems throughout the coastal United States. What's good for the Atlantic is good for the Gulf. Let's go back to the drawing board and come up with a solution that is in the longterm interest of Louisiana."

For more information, contact Denise Bottcher or Roderick Hawkins at 225-342-9037.