Infrastructure / Marcellus / Shale Daily / NGI The Weekly Gas Market Report / Northeast / NGI All News Access

FERC Denies New York AG's Rehearing Request on Constitution Pipeline

FERC on Tuesday denied a rehearing request by New York Attorney General (AG) Eric Schneiderman over allegations of unauthorized tree cutting and other activities along the right-of-way for the embattled Constitution natural gas pipeline.

Last May, Schneiderman filed a complaint with the Federal Energy Regulatory Commission [CP13-499] and petitioned the agency to impose a stay on the certificates of public convenience and necessity it issued in December 2014 to Constitution Pipeline LLC. Two months later, FERC said the AG should have submitted a request for an investigation, but agreed to look into the matter.

But in an order Tuesday, FERC said Schneiderman "asserts, but provides no supporting evidence, that Constitution and the Commission were aware that 'extensive clear-cutting and other activities have occurred on the project right-of-way' over which the Commission has jurisdiction and Constitution has control, and that Constitution did not act to stop those activities."

The pipeline would transport Marcellus Shale gas to markets in New York and New England.

According to FERC, Schneiderman's argument for a rehearing rests on the Commission's regulations for so-called "blanket certificates," under which ground disturbance activities that are inconsistent with applicable law, including the federal Clean Water Act, are forbidden. But FERC countered that Constitution is not yet a blanket certificate holder, and won't be classified as a natural gas company until the pipeline project is completed and operations begin. Constitution currently holds a blanket certificate for "future" activities only, the Commission said.

FERC added that two of its regulations governing construction and restoration techniques -- specifically, the Upland Erosion Control Revegetation and Maintenance Plan and the Wetland and Waterbody Construction and Mitigation Procedures -- apply to a project's sponsors and their agents, but not to private landowners or third parties taking action in a project's right-of-way.

"Even if we were to accept the AG's alleged facts, it cites no authority making Constitution vicariously liable for the ground-disturbing activities of third parties in the project right-of-way, and so fails to explain how Constitution's inaction to stop third parties' ground-disturbing activities 'violates applicable statutory or regulatory requirements,' as required for a complaint by Rule 206 of our Rules of Practice and Procedure," FERC said. "Therefore we will reject the NY AG's argument."

Doug Cohen, a spokesman for Schneiderman, told NGI's Shale Daily on Wednesday that the AG's office is "reviewing the decision."

FERC also denied a separate rehearing request on Tuesday by Catskill Mountainkeeper. The environmental group and others had argued that the Commission “had no good cause” to issue an extension for the project last July, but FERC ultimately disagreed.

Constitution is owned by subsidiaries of Williams Partners LP, Cabot Oil & Gas Corp., Piedmont Natural Gas Co. Inc. and WGL Holdings Inc. The 124-mile, 30-inch diameter pipeline would transport Marcellus gas produced in northeast Pennsylvania to Schoharie County, NY, where it would connect with two existing interstate pipelines: Iroquois Gas Transmission and Tennessee Gas Pipeline. It would provide 650,000 Dth/d of takeaway capacity.

FERC gave Constitution permission to begin cutting trees for the Pennsylvania portion of the project at the end of January.

The Constitution Pipeline was first proposed in February 2012, and its backersbegan the pre-filing process with FERC two months later. A formal application to FERC was filed in June 2013 and approved in December 2014.

Three months after winning FERC approval to begin construction, a federal court ruled the pipeline could proceed. The company then resubmitted an application for a water quality permit from the New York Department of Environmental Conservation (DEC) in April 2015, but the DEC denied the permit one year later. Constitution subsequently filed an appeal to the U.S. Circuit Court of Appeals for the Second Circuit, and oral arguments were scheduled for Nov. 16.

Construction of the pipeline has not been started. In FERC's order Tuesday, the Commission stipulated that Constitution may not proceed with construction until the matter over the DEC water quality permit is resolved.

Constitution said it anticipates that the pipeline could be entered into service in the second half of 2018, assuming it prevails in court. The project had an original in-service date of March 2015.

Recent Articles by Charlie Passut

Comments powered by Disqus