Palomar natural gas pipeline shelved

A proposed 217-mile natural gas pipeline project in Oregon was shelved Thursday after demand for it waned.

Developers of the proposed Palomar Pipeline, a joint venture between Portland-based Northwest Natural Gas Co. and TransCanada Corp. of Calgary, Alta., withdrew their permit applications Wednesday with the Federal Energy Regulatory Commission.

Despite declarations of victory from the project’s opponents, a spokesman for Palomar said the pipeline project is far from dead.

David Dodson, a TransCanada employee serving as spokesman for the Palomar project, said the applications were withdrawn after potential customers said the economic recession has sapped demand for natural gas, downgrading what was an immediate need for a new pipeline.

“These projects are so expensive and take so long that you’re really got to have your commercial support before you get started,” Dodson said.

But once commercial demand returns, Dodson said TransCanda and NW Natural plan to refile their permit application, albeit for a shorter project.

Palomar started out as a 217-mile, 36-inch diameter pipeline stretching from TransCanada’s Gas Transmission Northwest Pipeline in central Oregon to a point on the Columbia River near Astoria, where it was to connect a proposed liquefied natural gas terminal called Bradwood Landing.

In May, Bradwood’s developer, Houston-based NorthernStar Natural Gas, filed for Chapter 7 bankruptcy protection, putting a permanent halt to the project.

NW Natural officials at the time said that if no LNG terminal were developed, they would press on with the roughly 120-mile eastern portion of Palomar, from Madras to Molalla, where it would connect to TransCanada’s pipeline.

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@ErikSiemers | esiemers@bizjournals.com | 503-219-3418

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