An appellate court denied a motion Tuesday by Nexus Gas Transmission LLC to dismiss a lawsuit that centers around a dispute between Ohio landowners and FERC regarding the 1.5 Bcf/d 225-mile pipeline that would carry Appalachian natural gas to Michigan.

The decision by the U.S. Court of Appeals for the District of Columbia Circuit keeps alive a dispute that contends the Federal Energy Regulatory Commission erroneously certificated the pipeline, which stretches from a producing hotspot in Ohio to dense power markets in Michigan. The lawsuit is City of Oberlin, Ohio v. Federal Energy Regulatory Commission, No. 18-1248.

The petitioners, the City and the Coalition to Reroute Nexus, said demand for Nexus gas was insufficient and should not have garnered a certificate of public convenience. The group found other faults with the Commission’s decision, which were iterated in the original filing last December.

Nexus submitted a letter as an intervenor in May in an effort to squash the challenge, noting in its letter that in April 26% of shipped gas ultimately reached Canada, but even so, gas exports to a free-trade-agreement country like Canada is consistent with the public interest under Section 7 and Section 3 of the Natural Gas Act (NGA).

Gas shipped on Nexus, jointly owned by Enbridge Inc. and DTE Energy, can be ferried across the border to Canada through multiple interconnections with other interstate pipelines. FERC cleared Nexus to start flowing in October and granted the startup of a compressor station. The Commission has issued favorable orders on Nexus despite opposition during its construction.

FERC in January 2018 denied several motions to stay its August 2017 certificate order approving the Nexus project. The motions were filed by environmental and citizens’ advocacy groups.

One such group at the time was the City of Oberlin, the plaintiff in the ongoing lawsuit. The city has argued that Nexus construction involves taking property through eminent domain, which is something that FERC said is a matter for state and municipal courts. In the current lawsuit, Oberlin contends that Section 3 of the NGA “does not confer the power of eminent domain.”

Coincidently, Nexus filed an application Tuesday to FERC requesting an amendment to its certificate of public convenience to amend the capacity lease and operating agreement between Nexus and Texas Eastern Transmission LP (Tetco).

The amendments would reflect changes to the segment capacity and receipt points available to Nexus shippers on Tetco system, as well as the capacity at those receipt points. Ultimately, if approved, the changes would allow Tetco to abandon its lease capacity to Nexus.

The changes would provide additional receipt point flexibility for Nexus shippers by adding new receipt points and additional receipt point capacity, as per feedback from shippers, Nexus said in its FERC filing.