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Atlantic Coast Still On Schedule Despite Route Change, Execs Say

As Atlantic Coast Pipeline LLC continues to face regulatory hurdles and stall attempts from opposed landowners refusing access for survey work, executives for the pipeline held a conference call with reporters Tuesday reassuring all that the project is on budget and on track for its scheduled 2018 in-service date.

After its latest adjustments, including an alternative route proposed after the the U.S. Forest Service (USFS) rejected the original route through the George Washington and Monongahela national forests (see Daily GPI, Feb. 12), the $5 billion, 1.5 Bcf/d route for ACP is now nearly 600 miles, management said.

The ACP, which filed with FERC last September, is being built by Dominion Resources Inc. in a joint venture with Duke Energy Corp., Piedmont Natural Gas Co. Inc. and AGL Resources Inc. (see Daily GPI, Sept. 18, 2015). The proposed route begins in Harrison County, WV, and runs through Virginia and North Carolina.

Dominion Energy President Diane Leopold said ACP is in the process of providing supplemental information requested by the Federal Energy Regulatory Commission, with a “significant part” of these filings dealing with issues raised by the USFS. ACP expects to finish providing information to FERC in April and is “confident” that a draft environmental impact statement will follow shortly after. Leopold said this would “put us on track to receive a certificate from the FERC in ample time to allow us to keep on schedule to reach our in-service date at the end of 2018.”

Even with the revised, extended route, ACP is still within its original estimated cost, according to Dominion Energy’s Leslie Hartz, vice president of construction, who said the company planned “for a certain level of uncertainties and these kinds of additional costs.”

ACP is 96% subscribed with 20-year customer agreements, and the company has surveyed more than 450 miles of its proposed route over the past 18 months while evaluating “more than 6,000 miles of potential routes in order to choose the best path,” Leopold said. ACP has secured permission to survey roughly 90% of its original proposed route, she said.

Though most of the landowners along the proposed route have cooperated, the survey process is one area where opponents have attempted to stall the project, forcing ACP to work through dozens of court cases to obtain permission to access private property where the landowners have refused access (see Daily GPI, Feb. 4).

Assuming certain conditions are met, a 2004 Virginia law allows natural gas companies to survey on private property without the owner’s permission. That law has drawn scrutiny in light of the ACP -- and the similarly routed Mountain Valley Pipeline -- with state legislators attempting to repeal it during the past two sessions of the Virginia General Assembly (see Daily GPI, Feb. 10). The Supreme Court of Virginia recently affirmed the law’s constitutionality when it refused to hear an appeal (see Daily GPI, March 9).

Leopold and Hartz were asked about whether potential opposition from the 249 newly affected landowners along the alternative route could result in more court cases and possibly delay the project.

“We are pleased that we’ve had over 60% of the landowners on this new revised route already grant us access,” Hartz said. “We are currently surveying in the field. We recognize the sensitivity of the issue with the landowners, and we will follow the same process that we have followed before...our goal is to work with the landowners. However, if the landowners are firm in their denial of access we will proceed as we have...with following the required court actions.”

“We really try to be very sensitive to the concerns of every landowner,” Leopold added. “Surveying and talking about the concerns with the landowner is the best way to minimize impacts and address concerns...we’ve literally made hundreds and hundreds of minor adjustments, and we do that through talking to the landowners.”

ACP has taken “important steps to secure the material we need for the pipeline,” Leopold said. After reaching an agreement last year with Dura-Bond Industries to manufacture $400 million worth of steel pipe for the project, large diameter pipe should begin “rolling off the assembly line” at Dura-Bond’s Steelton, PA, facility in the next few weeks, with production to continue over the next 12 months, she said.

ACP is also close to finalizing agreements with its lead construction contractors and trade unions, she said.

Echoing the sentiments of a coalition of Hampton Roads, VA-area lawmakers who recently wrote in support of the project (see Daily GPI, March 16), Leopold said there’s a clear and urgent market need for the ACP.

“Our energy needs are growing in Virginia and North Carolina,” she said. “Demand for natural gas in the region is expected to increase by 165% by 2035. That growth is driven by the need for cleaner sources of electricity, home heating for a growing population and energy to fuel economic development, yet there is not enough infrastructure today in our region to meet that growing demand.”

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