Frozen gas plan heads into hot water

Electricity generators considering importing large shipments of frozen gas to bolster dwindling energy supplies could face public opposition to storing it in New Plymouth.

State-owned Genesis and listed company Contact Energy confirmed last night they were only a month or so away from choosing between port sites at New Plymouth and Marsden Pt for a potential $600 million liquefied natural gas (LNG) processing plant.

Although they emphasised they were still several years away from deciding whether to build a joint-venture plant, and would prefer not to have to do so, they said they needed to start preparing soon for the long process of seeking resource consents.

Contact Energy spokesman Patrick Smellie said New Plymouth and Marsden Pt were well-established petro-chemical ports which had been short-listed over less populous localities, such as next to the mothballed Motunui synthetic petrol plant north of Waitara.

Former New Plymouth chief fire officer Allen Pidwell earlier yesterday warned of the likelihood of public opposition if LNG ended up being stored and processed on the waterfront, near homes.

Mr Pidwell said that although his research on the fuel before he retired two years ago left him satisfied it was transported very safely in special tanker ships, there had been occasional handling problems at land-based storage facilities around the world.

LNG is shipped at an ultra-low temperature of -162C, at which it is condensed at 6000 times less than the volume of gas at a stove-tip burner, and it must be reconstituted before being fed into established pipelines.

The energy industry says an LNG conflagration which razed a 1.5sq km block of Cleveland, Ohio, in 1944, killing 128 people, was at an early stage of technological development and that the fuel is safer now than other petro-chemical products.

Although a fire at a liquefaction plant in Algeria in 2004 killed 27 workers, Mr Smellie said LNG did not explode like other petro-chemicals, and he was confident a high standard of engineering would prevent such a tragedy in this country.

But he said a local LNG facility would be visually intrusive, and it had been decided not to continue investigating more pristine sites.

"You would be creating a very large structure which would have impacts on the local environment," he said.

Port Taranaki is understood to have prepared an ambitious expansion plan costing up to $100 million to cater for an LNG terminal, which would require a considerable extension to its existing breakwater for tankers carrying up to 145,000cu m of the fuel.

Mr Pidwell is also secretary of the New Plymouth Surf Riders Club, which has had concerns about the impact of a longer breakwater on waves, but he said yesterday that the organisation had reached an "amicable" understanding with the port company.

He said the company had undertaken to provide certain mitigation measures.

Mr Pidwell said he was not at liberty to disclose those while commercial negotiations continued with the electricity generators.

LNG developments have proved controversial in the United States.

An Energy Department report late in 2004 considered the potential impact of a terrorist attack on tanker ships carrying the fuel.

It concluded that in a worst-case scenario of holes being blasted in them, fires would ignite buildings up to 800m away and burn people inside them.

Genesis spokesman Richard Gordon said that was about as unlikely to happen in New Zealand as "an asteroid dropping on Auckland".

There had been no accidental releases of LNG in 40,000 shipments over more than 40 years, he said, despite eight tanker groundings.