Calais LNG Update: Goldman Sachs Bows Out of Project

Becky Lipson

Last Wednesday, Calais LNG delivered its second major surprise in just two weeks.  After stunning all parties by asking the Board of Environmental Protection for a last minute hearing postponement, Calais LNG announced on July 21 that its financial backer, GS Power Holdings LLC, a subsidiary of Goldman Sachs, was in the process of “selling its ownership interests.”  Huh, go figure.  From our perspective, this just confirms that the smart folks at Goldman Sachs finally sat down after spending more than $24 million to take a hard look at the project and reached the same conclusion that we did long ago: the New England market is already saturated with natural gas and there is no need for a new industrial LNG terminal that will have significant adverse impacts on the environment and existing uses of Passamaquoddy Bay.

Calais LNG has promised to withdraw all of its applications for environmental approval if the company can’t find someone else willing to pay for the small army of lawyers and consultants by August 11, 2010.  Were the Calais LNG project to fade away, it would be the third LNG project in five years to withdraw its applications, joining Quoddy LNG and Downeast LNG.  And while there appears to be an obvious trend, namely failed projects and wasted time and money, Downeast LNG is still considering refiling with the BEP this summer.  If that is the case, we can only hope that the Board and State will have learned from past mistakes and not allow themselves to be bullied into unrealistically aggressive schedules for these complicated projects that will change the face and uses of Passamaquoddy Bay for generations to come.

Want to know more? Read this article in the Quoddy Tides.

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