Refiners in the U.S. are enjoying a feedstock price advantage relative to most of the world. However, with this opportunity comes challenges and some confusion with preparing for the crude quality shifts resulting in the “dumb-belling” of U.S. crude supplies, such that the lights get lighter and the heavies get heavier—ultimately resulting in declining middle-distillate yields.

By fourth-quarter 2013, Michael Frederick, vice president for LNG at Dominion Resources Inc., had heard the refrain, “If we can stop Cove Point, we can stop fracking” so many times that he had determined it was time to put that “ridiculous statement” to rest.

“The opposition was well-funded, and they had the playing field to themselves,” he told an audience at Hart Energy’s North American LNG Exports Conference. “If you wanted to critique us on what we could’ve done to get the project approved quicker, it might be that we had gone through all the steps to get things approved at the local and federal permitting [levels], but we hadn’t done a tremendous amount of outreach late in 2013.”

Meanwhile, opponents such as the national Sierra Club were “spreading misinformation” and using scare tactics on the locals, Frederick claimed.

“We actually had some people who were longtime friends and supporters starting to get concerned,” he said.

The Cove Point LNG facility sits on 1,017 acres in Calvert County, Md., a rural, largely Republican region in a decidedly Democratic state. In fact, roughly 800 acres of the site are part of a conservation easement protected by the Maryland Environmental Trust.

“What developed around that time period was almost a perfect storm. Let me be clear, the opposition to our project is clearly national environmental groups opposed to fracking,” Frederick said.

The Cove Point facility itself is an offshore LNG terminal, a mile from the mainland on the Chesapeake Bay. Critics have linked it to hydraulic fracturing, saying its existence could increase natural gas production to satisfy overseas markets.

Dominion executives decided it was time to reach out to the locals and tell their side of the story.

The company laid out the facts in a booklet mailed to more than 25,000 homes and made calls to explain the project. Frederick led several public information sessions and open houses, and for the first time the company started to talk about the millions of dollars in philanthropic efforts it had made in the community.

By the end of the year, the tide started to turn. Although about 30 locals still passionately oppose the project, Dominion enjoys widespread support, Frederick said. The company earned approval to move forward in Maryland.

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