creating a new energy gateway for the Northeastern United States

ExxonMobil’s BlueOcean Energy terminal could be another vital link in the company’s expanding network of LNG production, transport and delivery that includes operating and planned liquefaction facilities in nine countries.

This article originally appeared in the Lamp, 2008 — Number 1

As part of ExxonMobil’s continuing effort to bring much-needed energy supplies to the United States to meet the country’s growing demand, the company has announced plans to seek regulatory approval for a floating liquefied natural gas (LNG) receiving terminal to be built about 20 miles off the New Jersey coast.

The project, called BlueOcean Energy, will have planned capacity to deliver about 1.2 billion cubic feet a day of clean-burning natural gas — enough to meet the daily needs of 5 million residential customers. The terminal will be anchored to the seabed in 150 feet of water away from shipping lanes, ports and recreational areas. Startup is anticipated by the middle of the next decade.

Bill Davis, project executive for ExxonMobil’s Gas & Power Marketing Company, describes the primary aspects of the terminal and how they will work:

“The floating ocean terminal will be about the size of four football fields, but since it’s so far offshore, it will not be visible from the shoreline. About twice a week, an LNG ship will dock at the terminal and unload its liquid cargo. The double-hulled terminal features five LNG cryogenic storage tanks onboard and regasification equipment to warm the LNG into a gaseous state for transport to shore by a new undersea pipeline. The gas will then be transported by a new or existing onshore pipeline for sale to wholesalers, utilities and other industrial buyers who, in turn, will supply the fuel to homes, businesses, public buildings and power stations.”

Davis says this market is attractive for LNG imports, and getting the terminal effort started now is key to making the energy available when it’s needed. “We saw a need to supply more clean-burning energy to the New Jersey and New York region, and we’re bringing ExxonMobil’s proven technical prowess, commercial expertise, exemplary safety record and financial resources to bear to address that need.”

Ron Billings, vice president for ExxonMobil’s Gas & Power Marketing Company, agrees. “The Northeast is a growing gas market, and LNG imports are needed to supplement traditional domestic supply. This new source of clean-burning natural gas is a good project for the region that will help New Jersey and New York grow and prosper.”

According to a study conducted by the Rutgers University Bloustein School of Planning and Public Policy, BlueOcean Energy will bring sizable direct and indirect economic benefits to New Jersey and to the region through project spending, the creation of new jobs, taxes, other revenues and the additional supply of natural gas.

Matt Greer, who is heading up an ExxonMobil Development Company team providing marine, pipeline, regulatory and technical expertise for the project, says, “We are at the beginning of an extensive permitting process that involves conducting detailed safety and environmental assessments, and obtaining regulatory approvals from multiple federal and state agencies, including the Coast Guard, U.S. Maritime Administration and Federal Energy Regulatory Commission.” Greer says the company will work closely with the State of New Jersey and conduct ongoing discussions with communities and other stakeholders during the preparation of the Deepwater Port license application and U.S. Coast Guard analysis of the project.

He also points to the integration and cooperative efforts within ExxonMobil to effectively pursue this opportunity. “We’re drawing from the strengths of ExxonMobil’s organizations, involving early technology development from our Upstream Research Company, the Development Company’s work to make the technology ‘project ready,’ the Downstream marine organizations’ shipping and operations know-how as well as the sales and marketing expertise of the Gas and Power Marketing Company.”

ExxonMobil and its co-venturers are currently building three other LNG terminals in Texas, offshore Italy and in South Wales in the United Kingdom. Two of these terminals (UK and Italy) are expected to become operational later this year. The company is advancing government approvals for a fourth terminal in Hong Kong.

Along with its venture interests in the world’s largest LNG production trains in Qatar and a fleet of new-generation LNG carriers that can carry 80 percent more cargo than conventional LNG vessels, ExxonMobil is evaluating the development of LNG supplies in Western Australia, Papua New Guinea and Nigeria.