Maryland court denies objection to Dominion LNG export proposal

Dominion will move forward with engineering, marketing and regulatory review processes, the company said on Monday, after a declaratory judgment confirmed its right to build liquefaction facilities at its Cove Point facility on the Chesapeake Bay in Lusby, Md.

Circuit Court Judge James P. Salmon of Maryland ruled Friday that Dominion Cove Point's agreement with environmental agencies allows it to build liquefaction facilities inside the plant's fenced area and export liquefied natural gas (LNG).

The environmental group Sierra Club had maintained Dominion needed its permission to build the facilities.

"Dominion has made considerable progress towards a project that will bring jobs and revenues to the national and local economies," said Thomas F. Farrell II, president, CEO and chairman of Dominion.

"We have received support from business, labor, government, community and environmental groups for a major construction project that would bring great benefits to many people. We look forward to working with the Sierra Club and other involved environmental groups to continue the outstanding record of environmental cooperation at Dominion Cove Point."

The liquefaction project is expected to cost between $2.5 billion and $3.5 billion.

Dominion has received permission from the Department of Energy (DOE) to act as an agent for liquefied natural gas exports to countries with free trade agreements and is waiting for DOE action on its application for countries without a free trade agreement.

Dominion has entered the Federal Energy Regulatory Commission's pre-filing process in anticipation of filing an application in 2013.

Engineering studies are continuing and are expected to be completed soon. Terminal services agreements are under negotiation with potential customers, including Sumitomo Corp., a major Japanese trading company.

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