Jordan Cove at Coos Bay

A view of Coos Bay from a spot where Jordan Cove LNG terminal ship will be excavated, if approved by regulators.

Federal regulators on Thursday denied requests from the state of Oregon, affected landowners, tribal, environmental and fisheries groups to reconsider its March approval of the proposed Jordan Cove liquefied natural gas export terminal in Coos Bay and its 230-mile feeder pipeline.

The state had objected to the Federal Energy Regulatory Commission’s original decision to conditionally approve the project before it received required state permits. Those include its water quality certification, dredging permit and a determination that the project is in line with state land use laws — none of which appear to be forthcoming.

After the March decision, Gov. Kate Brown issued her first challenge to the project in her five years in office. She said she was stunned that the commission was issuing a decision during the ongoing COVID-19 crisis, and she was ready to challenge it legally.

“I want to reiterate that I will not stand for any attempt to ignore Oregon’s authority to protect public safety, health, and the environment’” she said at the time. “I have asked the state’s lawyers to consider all appropriate legal action to assure that Oregon permitting processes will be followed.”

She also said that until the project received every required permit from state and local agencies, she would prevent the company from taking early action on condemning private property or clearing land.

In a news conference after FERC’s meeting Thursday, Chair Neil Chatterjee reiterated a statement he made after the March approval.

“I want to be clear that a project cannot begin construction until all required permits have been received,” he said. “I’ll say that again, the project cannot begin construction until all required permits have been received.”

Chatterjee also said the project’s backer, Pembina Pipeline Corp., had eminent domain authority today to condemn private property for its pipeline, called the Pacific Connector. But he said no construction on the pipeline or LNG facility, including land clearing, can take place until the company has received all necessary permits.

That leaves Pembina in a standoff with Oregon, but with a longshot strategy to end-run state regulators.

Oregon’s Department of Environmental Quality has already denied the project’s water quality certification. The Department of Land Conservation and Development, meanwhile, has decided the project would have significant adverse impacts on the state’s scenic and aesthetic resources, endangered species, critical habitat, fisheries and commercial shipping. It ruled in February that the project wasn’t consistent with the state’s coastal zone land use laws.

Meanwhile Pembina withdrew its application for a dredging permit when the Department of State Lands indicated that it was about to reject that application, too. Pembina also needs the department to grant easements to use state land and waterways to build the gas liquefaction terminal, shipping berth and pipeline. Those are unlikely to be granted given the agency’s stance on the dredging permit. And Pembina can’t use the eminent domain authority that comes with its FERC approval against the state, only private property owners.

Debate over the controversial project has been intense in Oregon since it was first proposed as a gas import facility in 2005. Boosters tout the $10 billion project’s potential employment and property tax impacts in an area of the state that has lagged economically since the early 1980s. Opponents call it a potential environmental, public safety and property rights disaster.

Pembina hasn’t packed up its tent altogether. But it did recently close its office in Coos Bay, and for the time being, is pursuing a strategy that seems sure to prompt a legal response from Oregon. It has asked the U.S. Department of Commerce to overrule Oregon’s decision that the project isn’t consistent with state land use laws. And it has asked FERC to waive a requirement under the Natural Gas Act that it obtain a water quality certification from the state, arguing that the state failed to make a timely decision on that permit.

The company did not return a call for comment Thursday.

FERC’s decision denying a rehearing wasn’t unanimous. Commissioner Richard Glick, the sole Democrat on the ostensibly nonpartisan commission, raised climate and private property concerns, and questioned whether the project would ever be built.

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