02-14913. Federal Energy Regulatory Commission Southern LNG, Inc.; Notice of Application

June 7, 2002.

Take notice that on May 31, 2002, Southern LNG, Inc. (Southern LNG), P. O. Box 2563, Birmingham, Alabama 35202-2563, filed an application in the above-referenced docket numbers pursuant to Sections 3(a) and 7(c) of the Natural Gas Act (NGA) and Parts 153 and 157 of the Commission's Rules and Regulations, for a certificate of public convenience and necessity authorizing the construction, operation and maintenance of additional facilities at its liquefied natural gas (LNG) import terminal on Elba Island located in Chatham County, Georgia (Elba Island Terminal). The application is on file with the Commission and open to public inspection. This filing may be viewed on the web at http://www.ferc.gov using the “RIMS” link, select “Docket#” and follow the instructions (please call [phone] for assistance).

The expansion includes new process facilities and moving moored LNG ships to a new marine slip, cut in Elba Island and away from the Savannah River's main channel. Southern LNG proposes (1) to expand the storage capacity of Elba Island Terminal by constructing and operating a fourth cryogenic storage tank with a working capacity of approximately 3.3 billion cubic feet of natural gas equivalent (Bcfe); (2) to increase its average design sendout rate from 446 million cubic feet (MMcf) per day to 806 MMcf per day, and its maximum sendout rate from 675 MMcf per day to 1,215 MMcf per day, by constructing and operating additional LNG pumps and LNG vaporizers; (3) to construct and operate two unloading berths cut into a marine slip on Elba Island; and (4) appurtenant supporting facilities.

Southern LNG conducted an open season for the expansion capacity from September 10, 2001 to December 14, 2001. As a consequence, Southern LNG entered into a precedent agreement on December 24, 2001 with Shell NA LNG, Inc. (Shell). The precedent agreement obligates Southern LNG and Shell to enter into a contract for firm service for all the expansion capacity under Southern LNG's tariff on file with the Commission. The contract will have a primary term of thirty years.

The proposed construction will take place almost entirely on Elba Island, which Southern LNG already owns and has dedicated to its terminal. To establish the new marine slip, Southern LNG will perform some construction in the Savannah River, adjacent to Elba Island. Southern LNG has already applied for permits necessary for this construction from both the U.S. Army Corps of Engineers and the State of Georgia.

Southern LNG estimates that the total capital cost of constructing its proposed expansion will be approximately $148 million. Because the revenues from the expansion service will exceed the expenses each year, the existing service will not subsidize the expansion cost of service. Southern LNG proposes to operate the existing and expansion facilities as an integrated whole, which provides better outage protection and more flexibility. Rolling in the expansion facilities will thus provide both financial and operational benefits to both expansion and existing customers. Southern LNG requests that it may roll in the expansion with the existing rates in a Section 4 proceeding following the in-service date.

Any questions regarding the application be directed to Patrick B. Pope, Vice President and General Counsel, Southern LNG, Inc., P. O. Box 2563, Birmingham, Alabama 35202-2563 at [phone].

There are two ways to become involved in the Commission's review of this project. First, any person wishing to obtain legal status by becoming a party to the proceedings for this project should, on or before June 28, 2002, file with the Federal Energy Regulatory Commission, 888 First Street, NE, Washington, DC 20426, a motion to intervene in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations under the NGA (18 CFR 157.10). A person obtaining party status will be placed on the service list maintained by the Secretary of the Commission and will receive copies of all documents filed by the applicant and by all other parties. A party must submit 14 copies of filings made with the Commission and must mail a copy to the applicant and to every other party in the proceeding. Only parties to the proceeding can ask for court review of Commission orders in the proceeding.

However, a person does not have to intervene in order to have comments considered. The second way to participate is by filing with the Secretary of the Commission, as soon as possible, an original and two copies of comments in support of or in opposition to this project. The Commission will consider these comments in determining the appropriate action to be taken, but the filing of a comment alone will not serve to make the filer a party to the proceeding. The Commission's rules require that persons filing comments in opposition to the project provide copies of their protests only to the party or parties directly involved in the protest.

Persons who wish to comment only on the environmental review of this project should submit an original and two copies of their comments to the Secretary of the Commission. Environmental commenters will be placed on the Commission's environmental mailing list, will receive copies of the environmental documents, and will be notified of meetings associated with the Commission's environmental review process. Environmental commenters will not be required to serve copies of filed documents on all other parties. However, the non-party commenters will not receive copies of all documents filed by other parties or issued by the Commission (except for the mailing of environmental documents issued by the Commission) and will not have the right to seek court review of the Commission's final order.

The Commission may issue a preliminary determination on non-environmental issues prior to the completion of its review of the environmental aspects of the project. This preliminary determination typically considers such issues as the need for the project and its economic effect on existing customers of the applicant, on other pipelines in the area, and on landowners and communities. For example, the Commission considers the extent to which the applicant may need to exercise eminent domain to obtain rights-of-way for the proposed project and balances that against the non-environmental benefits to be provided by the project. Therefore, if a person has comments on community and landowner impacts from this proposal, it is important either to file comments or to intervene as early in the process as possible.

Comments, protests, and interventions may be filed electronically via the internet in lieu of paper. See, 18 CFR 385.2001(a)(1)(iii) and the instructions on the Commission's web site under the “e-Filing” link.

If the Commission decides to set the application for a formal hearing before an Administrative Law Judge, the Commission will issue another notice describing that process. At the end of the Commission's review process, a final Commission order approving or denying a certificate will be issued.

Linwood A. Watson, Jr.,

Deputy Secretary.