UPDATE 2-Cape Wind project gets favorable U.S. govt review

(Recasts, updates with comments from Cape Wind developer, Barack Obama)

By Tom Doggett

WASHINGTON Jan 16 (Reuters) - A proposal to build the first massive U.S. offshore wind energy project, opposed by influential residents of nearby resorts, got a favorable environmental review on Friday from the U.S. government.

The Interior Department's Minerals Management Service found there would be little negative impact from the Cape Wind energy project off the Massachusetts coast aimed at providing power for 400,000 homes.

MMS spokesman Dave Smith said the final environmental review found the impacts "are expected to be mostly negligible or minor."

With an estimated price tag of more than $1 billion, Cape Wind would consist of 130 wind turbines over 24 square miles (62 sq km) in Nantucket Sound, within view of popular Cape Cod resorts.

Opponents include U.S. Sen. Edward Kennedy and other residents of nearby Cape Cod, Martha's Vineyard and Nantucket, along with some environmental groups and local fishermen.

Jim Gordon, president of developer Energy Management Inc., said construction could begin by early next year and Cape Wind could begin producing electricity in 2011 or 2012.

The project's environmenal review will be open for public inspection for 30 days. The incoming Obama administration will decide whether to grant final government approval, MMS spokesman Smith said.

A decision "does not have to be issued after 30 days, but it can be...depending on how the next administration wants to go forward," Smith said.

Gordon said the project would help meet President-elect Barack Obama's goal to double U.S. renewable energy production over the next three years.

Obama touted wind and other renewable energy sources on Friday during a visit to a company in Ohio that makes parts for wind turbines.

"A renewable energy economy isn't some pie-in-the-sky, far-off future, said Obama, who added that such clean energy investments could provide 500,0000 jobs.

Cape Wind's turbines would stand about 440 feet (135 meters) from the surface of the water to the tip of the blade. Opponents say they could threaten the area's tourist industry.

Some environmentalists are worried the wind turbines would disrupt migratory patterns of birds and harm sea life. Area fisherman are wary about navigating near the project.

But some green groups back the Cape Wind project.

"Wind has proven that its benefits will far outweigh its impacts (and) is exactly the type of clean energy investment that will jumpstart our economy, create jobs and lead to energy security," said Nathanael Greene, senior energy policy specialist at the Natural Resources Defense Council. (Reporting by Tom Doggett; Editing by Marguerita Choy)