1. FERC Office of Energy Projects 1 Global LNG Outlook 2004 Regulatory Status & Challenges in the U.S. Richard R. Hoffmann, Director Division of Gas – Environment and Engineering OEP, FERC

2. FERC Office of Energy Projects 2 46 Existing Terminals with Approved Expansions A. Everett, MA : 1.035 Bcfd (Tractebel – DOMAC) B. Cove Point, MD : 1.0 Bcfd (Dominion – Cove Point LNG) C. Elba Island, GA : 1.2 Bcfd (El Paso – Southern LNG) D. Lake Charles, LA : 1.2 Bcfd (Southern Union – Trunkline LNG) Approved Terminals 1. Hackberry, LA : 1.5 Bcfd, (Sempra Energy) 2. Port Pelican: 1.6 Bcfd, (Chevron Texaco) 3. Bahamas : 0.84 Bcfd, (AES Ocean Express)* 4. Gulf of Mexico: 0.5 Bcfd, (El Paso Energy Bridge GOM, LLC) 5. Bahamas : 0.83 Bcfd, (Calypso Tractebel)* 6. Freeport, TX : 1.5 Bcfd, (Cheniere/Freeport LNG Dev.) 7. Lake Charles, LA: 0.6 Bcfd (Southern Union – Trunkline LNG) Proposed Terminals and Expansions – FERC 8. Fall River, MA : 0.8 Bcfd, (Weaver's Cove Energy/Hess LNG) 9. Long Beach, CA : 0.7 Bcfd, (Mitsubishi/ConocoPhillips – Sound Energy Solutions) 10. Corpus Christi, TX : 2.6 Bcfd, (Cheniere LNG Partners) 11. Sabine, LA : 2.6 Bcfd (Cheniere LNG) 12. Corpus Christi, TX : 1.0 Bcfd (Vista Del Sol - ExxonMobil) 13. Sabine, TX : 1.0 Bcfd (Golden Pass - ExxonMobil) 14. Logan Township, NJ : 1.2 Bcfd (Crown Landing LNG – BP) 15. Bahamas : 0.5 Bcfd, (Seafarer - El Paso/FPL ) 16. Corpus Christi, TX: 1.0 Bcfd (Occidental Energy Ventures) 17. Providence, RI : 0.5 Bcfd (Keyspan & BG LNG) 18. Port Arthur, TX: 1.5 Bcfd (Sempra) 19. Cove Point, MD : 0.8 Bcfd (Dominion) Proposed Terminals – Coast Guard 20. California Offshore: 1.5 Bcfd (Cabrillo Port – BHP Billiton) 21. Louisiana Offshore : 1.0 Bcfd (Gulf Landing – Shell) 22. So. California Offshore : 0.5 Bcfd, (Crystal Energy) 23. Louisiana Offshore : 1.0 Bcfd (Main Pass McMoRan Exp.) 24. Gulf of Mexico: n/a (Compass Port - ConocoPhillips) 25. Gulf of Mexico : 2.8 Bcfd (Pearl Crossing - ExxonMobil) Planned Terminals and Expansions 26. Brownsville, TX : n/a, (Cheniere LNG Partners) 27. Coos Bay, OR: 0.13 Bcfd, (Energy Projects Development) 28. Somerset, MA : 0.65 Bcfd (Somerset LNG) 29. Belmar, NJ Offshore : n/a (El Paso Global) 30. Altamira, Tamulipas : 1.12 Bcfd, (Shell) 31. Baja California, MX : 1.0 Bcfd, (Sempra & Shell) 32. Baja California - Offshore : 1.4 Bcfd, (Chevron Texaco) 33. California - Offshore : 0.75 Bcfd, (Chevron Texaco) 34. St. John, NB : 1.0 Bcfd, (Canaport – Irving Oil) 35. Point Tupper, NS 1.0 Bcf/d (Bear Head LNG - Access Northeast Energy) 36. Pleasant Point, ME : 0.5 Bcf/d (Quoddy Bay, LLC) 37. Quebec City, QC : 0.5 Bcfd (Project Rabaska - Enbridge/Gaz Met/Gaz de France) 38. Lázaro Cárdenas, MX : 0.5 Bcfd (Tractebel/Repsol) 39. Rivière-du- Loup, QC: 0.5 Bcfd (Cacouna Energy – TransCanada/PetroCanada) 40. St. Helens, OR: 0.7 Bcfd (Port Westward LNG LLC) 41. Puerto Libertad, MX: 1.3 Bcfd (Sonora Pacific LNG) 42. Offshore Boston, MA: 0.8 Bcfd (Northeast Gateway – Excelerate Energy) 43. Kitimat, BC: 0.34 Bcfd (Galveston LNG) 44. Prince Rupert, BC: 0.30 Bcfd (WestPac Terminals) 45. Goldboro, NS 1.0 Bcfd (Keltic Petrochemicals) 46. Galveston, TX: 1.2 Bcfd (Pelican Island – BP) Existing and Proposed North American LNG Terminals October 2004 FERC Office of Energy Projects A C 1 3 5 2 4 34 8 29 15 6 26 30 10 20 9 28 23 22 35 37 36 38 21 31 32 12 25 11 13 17 14 B 33 27 7 40 19 16 39 24 18 D 41 US Jurisdiction FERC US Coast Guard 42 44 43 *US pipeline approved; LNG terminal pending in Bahamas 45

3. FERC Office of Energy Projects 3 Applications Approved: Status of Construction Sempra, Cameron LNG (CP02-374) #1 Underway, Pending Amendment AES, Ocean Express Pipeline (CP02-90) #3 Pending Amendment Tractebel, Calypso Pipeline (CP01-409) #5 Pending Freeport LNG (CP03-75) #6 Pending Trunkline, Lake Charles Expansion (CP02-60) #7 Underway, Service 4 th Q ‘05 LNG Project Status - Approved Projects

4. FERC Office of Energy Projects 4 Onshore LNG Project Status Pre-Filing: Occidental, Ingleside (PF04-09) #16 Sempra, Port Arthur (PF04-11) #18 Dominion, Cove Point (PF04-15) #19

5. FERC Office of Energy Projects 5 Applications Filed: Working on DEIS –Sound Energy Solutions, Long Beach (PF03-6, CP04-58) #9 –Cheniere, Corpus Christi (CP04-37) #10 –Exxon Mobil, Vista del Sol (PF04-3, CP04-409) #12 –Exxon Mobil, Golden Pass (PF04-1, CP04-386) #13 –BP, Crown Landing (PF04-2, CP04-411) #14 –Keyspan, Providence (CP04-223) #17 Onshore LNG Project Status

6. FERC Office of Energy Projects 6 Applications Filed: Working on FEIS –Weaver’s Cove (PF03-4, CP04-36) #8 –Cheniere, Sabine Pass (CP04-47) #11 Onshore LNG Project Status

7. FERC Office of Energy Projects 7 Pre-Filing: El Paso, Seafarer (PF04-08) #15 Applications Filed: Working on DEIS with USCG –Freeport-McMoran, Main Pass (CP04-68) #23 –Conoco Phillips, Compass Pass (CP04-114) #24 –Exxon Mobil, Pearl Crossing (CP04-374) #25 LNG Project Status - Associated Pipelines

8. Office of Energy Projects 8 Pleasant Point, ME (36) Everett, MA (A) Providence, RI (17) Offshore Boston, MA (42) Fall River, MA (8) Somerset, MA (28) Legend: Existing Terminal Approved Terminal Proposed Terminal: Pre-Filing Proposed Terminal: Filed Working on DEIS Working on FEIS Planned Terminal North East LNG Terminals October 2004

9. Office of Energy Projects 9 Mid-Atlantic LNG Terminals Cove Point, MD (B/19) Logan Township, NJ (14) Belmar Offshore, NJ (29) Legend: Existing Terminal Approved Terminal Proposed Terminal: Pre-Filing Proposed Terminal: Filed Working on DEIS Working on FEIS Planned Terminal October 2004

10. Office of Energy Projects 10 South East LNG Terminals Elba Island, GA (C) Bahamas (3/5/15) Legend: Existing Terminal Approved Terminal Proposed Terminal: Pre-Filing Proposed Terminal: Filed Working on DEIS Working on FEIS Planned Terminal October 2004 Pipeline only

11. Office of Energy Projects 11 Corpus Christi LNG, TX (10) Vista Del Sol (12) Ingleside LNG (16) Lake Charles, LA (D/7) Port Pelican (2) Pearl Crossing (25) Freeport, TX (6) Golden Pass, TX (13) Brownsville, TX (26) Port Arthur (18) Sabine Pass, LA (11) Energy Bridge (4) Gulf Coast LNG Terminals Main Pass (23) Cameron (1) Gulf Landing (21) October 2004 Compass Port (24) Legend: Existing Terminal Approved Terminal Proposed Terminal: Pre-Filing Proposed Terminal: Filed Working on DEIS Working on FEIS Planned Terminal Galveston, TX (46)

12. Office of Energy Projects 12 Long Beach, CA (9) California Offshore (20/22/33) Southwest LNG Terminals Chevron Texaco (33) BHP Billiton (20) Crystal Energy (22) Legend: Existing Terminal Approved Terminal Proposed Terminal: Pre-Filing Proposed Terminal: Filed Working on DEIS Working on FEIS Planned Terminal October 2004

13. Office of Energy Projects 13 North West LNG Terminals Coos Bay, OR (27) St. Helens, OR (40) Legend: Existing Terminal Approved Terminal Proposed Terminal: Pre-Filing Proposed Terminal: Filed Working on DEIS Working on FEIS Planned Terminal October 2004

14. FERC Office of Energy Projects 14 Outlook/Issues Associated with LNG Development States attempting to assert economic jurisdiction in the post-Hackberry environment Public safety information/Irrational Risk Standard Interchangeability Congressional Legislation

15. FERC Office of Energy Projects 15 Beware the IRS??? (Irrational Risk Standard) Education is the key to overcome the Irrational Risk Standard: –Educate the Public and Agencies –Education and preparation of “First Responders” National Association of State Fire Marshals DOT –Industry had a lead role/duty in this education.

16. FERC Office of Energy Projects 16 Legislation What Could It Do? Eliminate Jurisdictional Conflicts Create a Lead Agency for Review and Permitting Require One Consistent Federal Record Set a Deadline for Processing Require Consistent Judicial Appeal

18. FERC Office of Energy Projects 18 LNG Siting Issues Safety Takeaway Capacity Local acceptance Federal and State approvals

19. FERC Office of Energy Projects 19 FERC’s Recent Actions FERC’s Modeling Study Skikda Accident Follow-up Reorganization for Safety @ FERC Fire Marshal Interaction Three “Faces” of LNG Regional Planning

20. FERC Office of Energy Projects 20 A number of studies gave rise to controversy FERC contracted with ABSG to identify models Gives FERC the ability to do more site specific modeling and reviews in EISs Provides a solid theoretical foundation from which to build on as new information becomes available Assumptions in the study are conservative Recent Events The FERC Model

21. FERC Office of Energy Projects 21 Recent Events Skikda Accident Preliminary findings: –Initial explosion of high-pressure steam boiler caused by hydrocarbon leakage into combustion air fan –Larger secondary explosion of the hydrocarbon vapors in the immediate vicinity. –Consequences: Loss of life and plant property March 13 – 15, 2004 – FERC / DOE Team inspected accident site and interviewed Sonatrach. FERC / DOE Report addresses team review.

22. FERC Office of Energy Projects 22 New LNG Branch at FERC to focus on and enhance LNG review, inspection programs Provide for Seamless Review of LNG Facilities –Interagency Agreement on Safety and Security Application of FERC Model for LNG Tanker Release Consequences Contract awarded for review of the LNG Program Recent Events Reorganization for Safety

23. FERC Office of Energy Projects 23 National Association of State Fire Marshals (NASFM) –The Partnership for Excellence in Pipeline Safety is authorized under a Cooperative Agreement between the NASFM and the OPS –NASFM will mobilize America’s emergency responders and the communities they serve to help prevent, safely mitigate and investigate pipeline incidents LNG module being developed –www.safepipelines.org Recent Events Fire Marshal Interaction

24. FERC Office of Energy Projects 24 Recent Events Three “Faces” of LNG How you get your LNG news affects your perception –Popular Press (e.g., Newspapers) –Trade Press –FERC Filings and Issuances

25. FERC Office of Energy Projects 25 Recent Events Regional Planning FERC’s processing of LNG proposals eliminates the need for regional planning of LNG –Our review process addresses the public interest –We evaluate the proposals, giving regulatory certainty to all involved stakeholders. –Efficient and timely decisions, with proper consideration given to environmental concerns, including examinations of alternative sites, allows the market to pick the appropriate LNG facilities.