Gas developer hits brakes on hotly contested LNG terminal

For the past year, residents in Port St. Joe, Florida have been fighting to stop a liquefied natural gas terminal from being built on the town’s Gulf Coast shore. Now, community members say they’re breathing a sigh of relief.

Nopetro Energy, the Miami-based company that had proposed constructing the LNG terminal, said it was no longer moving forward with the $100-million-plus project.

According to the company, Nopetro ​“conducted due diligence” last year on the potential LNG site — a 60-acre waterfront lot that for many decades hosted the town’s paper mill. The land is just a mile away from the historically Black neighborhood in the northern part of Port St. Joe, where residents are still grappling with the toxic legacy left behind by the St. Joe Paper Company.

Nopetro, whose stated mission is to ​“end petroleum dependency,” had proposed building a ​“small-scale” terminal to compress and chill fossil gas, then load it onto cargo ships bound for countries in the Caribbean and Central and South America. The project would have initially exported about 3.86 billion cubic feet of LNG per year, with the potential to expand.

After completing its review, the company ​“decided to no longer pursue the opportunity, purely due to market conditions,” Ed Hart, Nopetro’s senior vice president of supply, said in a statement provided to Canary Media this week.

The decision comes as the United States is exporting record-breaking amounts of LNG, a trend that threatens not only the country’s own goals for cutting planet-warming emissions but international climate targets as well. Nearly all of that LNG moves through large-scale export terminals in the U.S. Gulf Coast, though in recent years developers have pushed to build more smaller-scale facilities that serve specific markets.

Hart said that Nopetro made up its mind ​“many months ago” to halt plans for an LNG facility in Port St. Joe. The project’s opponents say they only learned of Nopetro’s decision earlier this week after local outlets like the Port St. Joe Star newspaper reported the development. Still, some observers had anticipated the move. In May, the St. Joe Company, which owns the former paper mill site, said in a shareholder meeting that Nopetro hadn’t signed a lease agreement for the LNG facility.

Community activists counted Nopetro’s about-face as a victory. 

“We were successful,” Dannie Bolden, a community leader in Port St. Joe, said by phone.

Bolden has helped to organize a broad group of local residents from across town and within Gulf County, who now meet under the umbrella of the Gulf County Citizens Coalition for a Healthy Future. Residents have been gathering regularly on Zoom calls and in church halls to discuss the LNG plant and voice their concerns about the environmental harm and climate impacts that might come from handling gas near a marginalized community and a delicate ecosystem.

Bolden said he wasn’t ready to let his guard down, at least when it comes to redeveloping the much-contested waterfront lot.

“We’re still going to keep our eyes and ears open to make sure that, hopefully, there are no other industries out there like Nopetro that are trying to come to the site and build a facility that would be a health and safety hazard to the community,” he said.

A lawsuit sparked by Nopetro’s initial proposal will also continue, even if Nopetro says it’s no longer pursuing the LNG project.

The legal challenge stems from a March 2022 decision by the U.S. Federal Energy Regulatory Commission, which issues permits for large energy projects. The agency determined that Nopetro’s proposed facility in Port St. Joe did not fall under the agency’s jurisdiction. As a result, that project likely wouldn’t need to undergo FERC’s comprehensive, yearslong process of environmental review and public participation. Instead, other federal agencies and state and local authorities would individually assess different aspects of the project.

Public Citizen, a consumer advocacy group, has argued that without FERC’s regulatory oversight, fossil fuel companies will have an easier time building small-scale LNG facilities across the country — a development that would potentially boost the nation’s greenhouse gas emissions and put more communities in difficult situations. Last year, the group filed suit asking a federal court to reverse FERC’s decision.

Tyson Slocum, director of Public Citizen’s Energy Program, said he expects the court to hear oral arguments this fall, with a final decision coming in the first quarter of 2024.

“We’re going to keep putting the pedal to the metal,” he said. ​“Our lawsuit is intended not just to protect the good people of Port St. Joe but everybody, to ensure that any LNG export terminal is subject to effective FERC regulatory oversight.”