Friday, July 11, 2014

Longview Export Terminal Negotiations Falter

By Mark Edward Nero

Port of Longview CEO Geir-Eilif Kalhagen said this week that negotiations with a Texas company that wants to build a propane and butane export terminal at the port have not progressed well up to this point.

During the July 8 Port of Longview Commission meeting, Kalhagen told the three-member panel that he was disappointed with the talks so far with Haven Energy, a subsidiary of Houston-based natural gas-related infrastructure company Sage Midstream.

Haven is proposing an export facility to move propane and butane currently being flared in the Midwest to energy markets around the Pacific Rim. The company says it’s looking at building a unit train accessible rail unloading facility, storage tanks and ship loading area at the port with the capability to load marine vessels with up to an about capacity of 550,000 barrels.

The company’s proposal calls for the cargo to be railed to the port from the North Dakota and South Dakota, then refrigerated and stored on site at Longview before being loaded to vessels for export to Hawaii, Mexico and Asia.

In April, the company entered into a one-year option agreement with the port to evaluate the project, but according to Kalhagen, lease negotiations haven’t gone particularly well.

“We’re probably farther apart now than we’ve ever been in the process,” he said.

“I think there’s a lack of understanding of the environmental concerns the State of Washington and the Port of Longview have, as far as looking at these kinds of projects,” Kalhagen told the harbor board. “There’s also the realization that this is not Texas,” Kalhagen said. “The pricing structure available in Texas is not available in the state of Washington.”

Negotiations, however, are expected to continue throughout the one-year option window.