A bill that would amend current law and remove eminent domain authority for natural gas liquids (NGL) pipeline projects will be debated by the Kentucky House following an overwhelming committee vote on Wednesday.
Some landowners whose land sits along the proposed route of the Bluegrass Pipeline project have complained to representatives for months about their rights to prevent it from being buried on their property. Some testified before the committee that they also have been harassed by representatives of joint owners Williams and Boardwalk Pipeline Partners LP. Bluegrass, which is delayed until mid-2016, would run about 1,100 miles south from Appalachia to Gulf Coast markets (see Shale Daily, Feb. 20; Nov. 21, 2013). As designed, about 200 miles would travel through Kentucky.
Eleven of 12 members of the Kentucky House Judiciary Committee approved House Bill 31 to amend and clarify that eminent domain could not be used for NGL pipelines. The legislation stipulates that the definitions of "oil and gas" and "oil and gas products" don't include NGLs, including ethane, propane and butane. Liquids are byproducts of gas production and therefore would not be part of existing law, the bill states.
"If the state or anyone else is to condemn private property, that should be for public use, which our constitution clearly states, and we as a legislature have clearly confirmed in subsequent years," said bill sponsor Rep. John Tilley (D-Hopkinsville), who chairs the judiciary committee. The legislation, he said, isn’t intended to prevent Bluegrass but rather to restrict eminent domain for the benefit of landowners that don't want pipelines buried on their property.
"The most overriding factor is that the statutes have never contemplated natural gas liquids," Tilley said. NGLs were not being produced when the eminent domain statute was enacted years ago. "We have a new player in the game essentially," he said of NGLs, and a "much heavier risk involved with them."
Gov. Steve Beshere has indicated he wants the legislation enacted.
"Although we have been advised that existing law does not permit companies to use eminent domain for private projects like the Bluegrass Pipeline, I would welcome legislation that will clarify and codify that point," he said.
Although the bill easily cleared the committee, Tillery said he expected amendments to be attached.
Bluegrass proponents argued that no new legislation is needed.
"We believe that current federal and state laws are more than adequate in terms of oversight and regulation of both the construction and operation" said the project sponsors. Williams has said it holds more than half of the easements necessary to cross Kentucky. The Bluegrass partners also have said they only would use eminent domain to secure easements on private property if rerouting Bluegrass wasn't feasible.
The proposed legislation requires approval by the full House before it is passed to the state Senate.