Broadwater Energy, a joint venture of Shell Oil and TransCanada Pipelines, proposes to moor a 1,200-foot-long floating liquefied natural gas terminal in the New York waters of Long Island Sound, nine miles off the coast of Wading River. The facility would take delivery of super-cooled liquefied natural gas from oceangoing tanker carriers, heat it to return it to a gaseous state, and supply it to the metropolitan New York market via a new 22-mile subsea pipeline that would connect to the existing cross-Sound Iroquois pipeline. The Broadwater terminal would be capable of supplying the New York region with about 1 billion cubic feet of natural gas daily, which will save L.I. consumers an average of about $300 per year on their utility costs, according to the developer.

Opponents have attacked Broadwater’s savings claim and argued that the terminal cannot be safely operated in the Sound, and that its operation would have significant adverse impacts on commercial and recreational fishing, boating and the environment.

FERC granted Broadwater a permit to construct and operate the terminal in January, subject to approvals by the New York state and environmental conservation departments, as well as a finding of suitability by the Coast Guard’s captain of the port. The DEC is still reviewing Broadwater’s air and water quality permits, but the state department ruled on April 10 that Broadwater is not consistent with the state’s coastal management policy. Broadwater has exercised its right to appeal that determination to the U.S. secretary of commerce, who can override the state agency’s finding.

Capt. Ronan issued his letter of recommendation Wednesday. In it, he notes that his recommendation will have no legal effect unless the commerce secretary overrides the N.Y. secretary of state.

“Safety and security are top priorities for the Broadwater project,” Broadwater senior vice president and regional project director John Hritcko said.

But the Coast Guard letter “reaffirms that the Coast Guard currently believes the water body is unsuitable without large scale, expensive mitigations,” said Citizens Campaign for the Environment executive director Adrienne Esposito, who has been a vocal opponent of the Broadwater proposal. Pointing to the 2006 Waterway Suitability Report’s list of actions that must be taken by the Coast Guard itself to make the Sound “suitable” for Broadwater and the marine traffic the project will generate, Ms. Esposito asked, “Who’s going to fund these big-ticket items they need? Now we have clarity from the Coast Guard on what the applicant needs to do, but the Coast Guard still has a tremendous financial hurdle to overcome. And that hurdle gets bigger every month,” she said. “With a national deficit of $8 trillion, I don’t think there’s money in the budget to assist Shell Oil.”