HARTFORD, Conn. (AP) – A giant liquefied natural gas terminal proposed for Long Island Sound between Connecticut and New York would have minimal effects on the environment, federal regulators said in a preliminary report Friday.

The draft report by the Federal Energy Regulatory Commission sparked immediate criticism from opponents of the project, including Connecticut Attorney General Richard Blumenthal, Connecticut Sen. Joe Lieberman and the Connecticut Fund for the Environment.

Opponents said they would submit written comments and appear at public meetings scheduled for January to challenge the report on Broadwater Energy’s proposal. Blumenthal said he was prepared to take the issue to court if necessary.

“The FERC report is a whitewash,” Blumenthal said. “Broadwater would be an unnecessary monstrosity permanently defacing and degrading Long Island Sound, another abhorrent step toward industrialization of this priceless natural resource and national treasure.”

FERC said the floating terminal, proposed for New York waters about 9 miles from Long Island and 11 miles from the Connecticut shore south of New Haven, would have only minor effects on the environment and public safety, under several conditions that would be attached to the project.

Federal regulators also said the project would be key to meeting the region’s natural gas needs.

A report issued by the U.S. Coast Guard in September said the natural gas terminal poses safety and security risks that would require more firefighters, escort boats and other measures to prevent accidents or terrorist attacks.

The Coast Guard did not take a position on the proposal, but concluded that additional measures would be needed to “responsibly manage risks to navigation safety and security risks” associated with the project.

If the project is approved, FERC said the Coast Guard would establish and enforce safety and security zones around the terminal. The company also has said it would provide staff and equipment to handle emergencies.

Officials from Broadwater Energy, a consortium of Shell Oil and TransCanada Corp., said they were pleased with the draft report, calling it a significant breakthrough for the project.

“It’s a key milestone,” said company senior vice president John Hritcko. “It confirms what we’ve been saying all along.”

The terminal would supply 1 billion cubic feet of natural gas a day, enough to heat 4 million homes a year. The terminal would be about 1,200 feet long and 200 feet wide, with an 82-foot-high upper deck. Plans call for the terminal to be completed by mid-2010.

Natural gas is cooled and condensed into a liquid to make transportation easier. Under the Broadwater proposal, the terminal would receive LNG shipments by boat, then pump the gas into the existing pipeline between Long Island and Connecticut.

Roger Reynolds, a lawyer for the Connecticut Fund for the Environment, said his organization has serious disagreements with FERC’s report.

“The enormous industrial facility proposed for the middle of Long Island Sound is a bad idea,” Reynolds said. “It would industrialize and privatize Long Island Sound, making a large area off limits to the public. It would be environmentally destructive, and it is unsafe and it is unnecessary.”