Calpine Pulls Out

3/17/04 Calpine Pulls Out
by Leann Whitten
The Eureka Reporter
Calpine Corp. — a San Jose-based independent power producer — withdrew its request for an exclusive right to negotiate agreement for the Samoa LNG project on Wednesday. The adjourned City Council meeting scheduled for Thursday night has been canceled.

In a letter to the Eureka City Council, Calpine representative Ken Abreu said Calpine “is ceasing all development activities on the project as of (Wednesday).”

The company was considering proposing a facility that would receive exports — via tanker at a Samoa Peninsula location — of liquefied natural gas, heat it back to its gaseous state and distribute it via pipeline to the Central Valley. Energy from the plant would have also powered a power plant that Calpine would have built for the area.

“It is the policy of Calpine not to build projects in areas where there is insufficient community support. Based on feedback received from the local community and public officials we feel this decision is best for all parties,” he wrote.

Abreu said Calpine was appreciative of the City Council’s consideration and the city staff’s “fair and diligent” efforts in working with us to present the project.

“We wish the residents of Humboldt County well in their efforts to find a productive and compatible use for their port facilities,” Abreu concluded.

“I think the city council is disappointed that we weren’t able to get this project into some type of process,” City Manager David Tyson said. “The council had been working very hard with other elected officials in the region to try to find a way that was acceptable to move this project forward (that would meet the needs of residents and Calpine).”

Tyson said as Calpine is a corporation, the ERTN agreement was needed to meet its needs.
Tim McKay, executive director of the Northcoast Environmental Center, said he believes without the ERTN Calpine couldn’t secure investors and the corporation doesn’t have the money to fund the $1 billion project itself.

“Thousands of thank yous to all who helped make this ground swell of public opinion penetrate to Calpine's front office,” McKay wrote Wednesday afternoon in a bulk e-mail.

“I think there are other opportunities for the port. … Growing our sustainable fishing industry is the most-important thing to do right now,” McKay said. “I think Humboldt County has a brighter future without an LNG facility than with one.”

Abreu said in an interview with The Eureka Reporter last week, that if the community didn’t want LNG here, then Calpine would not push it.

“If we wanted to (do it without community consent), we wouldn’t have proposed the independent study process.”

“Some people have visions of natural lands used for recreation. Some people feel like a deep-water port should be utilized,” Abreu said. “The people of this county need to make up their minds on which of the two visions makes sense.”