Controversial gas terminal in S. Jersey is shelved

TRENTON, N.J. - Energy giant BP has suspended plans to build a $700 million liquefied natural gas terminal along the Delaware River in southern New Jersey.

"We've been looking at the global market conditions surrounding LNG, and the timing for a terminal just isn't right, so we've put it on hold for at least two years," BP spokesman Tom Mueller said today.

Actually, BP's project was in doubt even before the upheaval in global markets. Last spring, the U.S. Supreme Court ruled against New Jersey, which had backed the BP project, in a jurisdictional issue with neighboring Delaware, which opposed the BP plan.

BP's plans for the plant, to be called Crown Landing, called for a 2,200-foot pier to be built off Logan Township, N.J. Delaware had rejected the request for safety reasons because unloading natural gas at the site would have violated a Delaware law that limits industrial activity along the coast.

"We will hold on to the property and look at conditions down the road," Mueller added, noting that the company "believes New Jersey will need LNG infrastructure in the future, and we will position ourselves to do that."

New Jersey had approved the project, with supporters saying it would create jobs and protect the region against rapid natural gas price increases.

The plant was designed to handle enough liquefied natural gas, or LNG, to serve 5 million homes and meet rising demand.

Delaware owns the river bottom most of the way across the waterway, including the portion of the riverbed on which the pier would be built, but New Jersey argued that each state controls piers on its side of the river.

The court ruled in March that Delaware has veto power over developments that extend into its borders on the river.

London-based BP has its U.S. headquarters in Houston and is the largest producer of oil and natural gas in the United States.