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PennEast NatGas Pipeline Survey in New Jersey Running into Challenges

The New Jersey Department of Environmental Protection (NJDEP) has told FERC that it can make only limited comments on PennEast Pipeline Co. LLC's proposed Marcellus Shale natural gas pipeline because the company has received permission to survey less than 35% of the proposed pipeline's route.

Meanwhile, Mercer County, NJ, rescinded its permission for PennEast to survey county-owned land that lies along the pipeline route, after county officials found out that the company had taken soil samples from a county park near the Delaware River.

The proposed 36-inch diameter pipeline would have a capacity of 1 Bcf/d and run 108 miles -- from Luzerne County, PA, to Mercer County, NJ -- and interconnect with the Transcontinental Gas Pipeline (Transco). A binding open season held last September yielded 965,000 Dth/d of bids (see Shale Daily, Sept. 5, 2014; Aug. 12, 2014).

NJDEP sends letter to FERC

In a 20-page letter to the Federal Energy Regulatory Commission on July 2, NJDEP Deputy Chief of Staff John Gray said that at the time, less than 60% of the proposed pipeline route lay within an existing road or utility right-of-way. Complicating matters even further, Gray said PennEast had obtained access to less than 35% of the public and private land along the pipeline route in New Jersey -- all of it in Mercer County.

NJDEP's Office of Permit Coordination and Environmental Review distributed, for review and comment, draft resource reports for the proposed project. The reports were prepared as part of FERC's National Environmental Policy Act (NEPA) requirements.

"Other than required NJDEP permits for delineation and investigation, [we] cannot complete a review of land use or water quality permits for any site preparation or construction if the potential impact surveys and mitigation and restoration plans are not completed to [our] requirements," Gray said.

Gray said the NJDEP "strongly encourages PennEast to complete the surveys prior to completing the pre-filing review period and before submitting an application to FERC for a certificate of public convenience and necessity." Gray also encouraged PennEast to allow the NJDEP to review any draft environmental impact statement (DEIS) prepared by FERC, prior to the company submitting any permit application for site preparation or review of major construction.

"The letter basically encourages PennEast to consider another route or co-location with existing utility rights-of-way," NJDEP spokesman Lawrence Hajna told NGI's Shale Daily on Wednesday. "If you're going to do a project like this, we strongly encourage co-location because it avoids new environmental impacts, and we also encourage certain technologies be used to minimize impacts to streams."

Patricia Kornick, a spokeswoman for PennEast, told NGI's Shale Daily that the company had just started the surveys, and that it currently had permission to survey more than 35% of the proposed pipeline's route.

"We are still very much in the pre-filing phase, and continuing to work with agencies and various landowners to secure survey permission," Kornick said Wednesday. "We have started to survey where we have permission. We've started to survey the public parcels, and we're also just now beginning some of the private parcels.

"Obviously, we would like to see [the survey permission percentage] a little bit higher and we're continuing to work toward that end."

Not a victory for pipeline opponents

Jeff Tittel, director of the New Jersey Sierra Club, called the low permission percentage "a victory in our ongoing the battle to stop PennEast. Because people have stood up, 65% of landowners have denied PennEast permission to survey their land, there are huge gaps in the information they need to get permits…

“The more we can say ‘no’ to allow them on our property, the more we can stop PennEast. The more property owners who deny access to the land and deny surveys, or revoke the permissions you gave them, the better chances we will stop this project. By sticking together and keeping them off our land, we can win."

Kornick disagreed with Tittel's analysis. "People opposed to the project are excited and saying this is a victory," she said. "In fact, contrary to being a setback, it's actually right in line with what PennEast hopes to achieve throughout the pre-filing process -- [receiving] input and feedback.

"This particular [NJDEP’s] letter outlines the agency's expectations and provides a very constructive roadmap in helping PennEast to define the best route, and our options to evaluate doing that. It's really not out of the norm -- it's very much part of the process and we'll continue to meet various directly involved landowners as well as the agencies and are still anticipating our formal FERC application to be filed in 3Q2015."

County upset about soil samples

On Monday, Mercer County Executive Brian Hughes said PennEast would no longer have access to county-owned property to conduct surveys for the pipeline, after the company performed soil borings on Baldpate Mountain, which the county deemed as potentially environmentally harmful.

"PennEast has no legal obligation to consult with the county to access public land," Mercer County stated. "But in order to understand the full and possible impact to county parkland, the county believed that granting access to the company to delineate wetlands and to survey would provide the knowledge necessary to wage a battle to protect county open space.

"In light of the intrusion on numerous ecosystems and news that the NJDEP has been unable to collect enough information to issue permits to PennEast to perform work, the county has blocked further access to its property."

The county gave PennEast permission to survey county-owned land last December. The county issued a separate cease and desist letter on Tuesday to Bernie Holcomb, pipeline environmental services manager for UGI Corp., one of six stakeholders in the PennEast project.

But Kornick said the county was well aware that PennEast would be taking soil samples.

"PennEast is conducting critical survey work, including geotechnical borings, but only with applicable permits and permission," Kornick said. "And the fact is we do have permission.

"Surveys compliment the numerous comprehensive geological, environmental and engineering studies. While PennEast is disappointed to learn of Mercer County's decision, it's certainly not going to prevent us from still working with Mercer County as well as other directly involved landowners."

Kornick said PennEast and Mercer County were continuing discussions, and hinted that it could regain permission. "I believe that's happening as we speak," she said, earlier adding "we've had people who have rescinded permission and then they have given permission again. It really is building a relationship and talking and addressing questions and being able to explain the process.

"We are continuing to talk, and that's something we would do with anybody."

Last October, FERC approved PennEast's request to initiate a pre-filing review for the project (see Shale Daily, Oct. 17, 2014). PennEast plans to complete the pre-filing process and submit a formal application to FERC in 3Q2015, and expects a decision by 2016. Assuming approval by FERC, construction is targeted to begin in the spring 2017, with an in-service date in the late fall of 2017.

PennEast's six stakeholders are Spectra Energy Partners; AGL Resources; NJR Pipeline Co., a subsidiary of New Jersey Resources; PSEG Power LLC; South Jersey Industries; and UGI Energy Services, a subsidiary of UGI Corp. Spectra and PSEG each hold a 10% interest in the project, while the remaining four companies each have a 20% stake (see Shale Daily, Oct. 31, 2014).

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