The top Democrats from the respective House and Senate energy committees are calling on FERC to broaden its investigation of Energy Transfer Partners LP's (ETP) Rover Pipeline, citing "serious concerns" over the alleged environmental violations occurring during the project's construction.
Sen. Maria Cantwell (D-WA), ranking member of Senate Energy and Natural Resources Committee, and Rep. Frank Pallone (D-NJ), ranking member of the House Energy and Commerce Committee, said in a letter to the Federal Energy Regulatory Commission Thursday that they "welcome" the agency's investigation into Rover's undisclosed destruction of a historic home in Ohio last year.
FERC staff has alleged that ETP/Rover violated the project's certificate under the Natural Gas Act (NGA) by failing to disclose its plans to acquire and demolish the structure -- located near a proposed compressor station -- and for making "several misstatements" to the Commission about the incident.
The lawmakers urged FERC to expand its investigation "to include a review of all ETP projects and assets subject to the Commission's jurisdiction."
In addition to the incident with the historic home, Cantwell and Pallone cited "seven industrial spills" occurring during Rover's construction, including the April horizontal directional drilling (HDD) fluids spill that released an estimated 2 million gallons of slurry into wetlands near the Tuscarawas River in Stark County, OH. They also pointed to last week's court-order halting HDD work on ETP affiliate Sunoco Pipeline LP's Mariner East 2 project, which followed reports of water contamination from construction activity.
"Taken in total, these problems raise serious concerns similar to those surrounding the construction of the Iroquois Pipeline in New York in the 1990s. This incident raised questions about the adequacy of information disclosure and compliance with environment and safety regulations during pipeline construction. We do not wish to see these failures repeated," the lawmakers wrote.
"Our committees have a longstanding interest in ensuring regulated entities are operating in full compliance with all applicable statutes and regulations, including providing agencies with honest information during the natural gas permitting process, as required by the NGA," they wrote. "This is particularly significant with respect to your agency's charge that Rover provided it with potentially false or misleading information, in light of the fact that a certificate of public convenience and necessity conveys with it the right to take private property through eminent domain. It is unacceptable that people's land could be taken by a for-profit company like Rover through a certificate gained, at least in part, on the basis of potentially false information."
Asked about Cantwell and Pallone's letter, ETP spokeswoman Alexis Daniel said the company "has been actively engaged in productive dialogue with state and federal regulators for many weeks and, where appropriate, has undertaken remediation activities. The company intends to continue both its discussions and remediation efforts until such time as the regulatory authorities are satisfied. The sort of investigation suggested in this letter is both unnecessary and unprecedented. Cooperative dialogue is a far more effective approach."
Cantwell and Pallone's letter further piles onto a Rover project already under intense regulatory scrutiny.
Rover has been suspended from starting new HDD crossings for the 710-mile, 3.25 Bcf/d pipeline since May, when FERC intervened following the Tuscarawas River drilling fluids spill. FERC has since said it is conducting an enforcement investigation of the spill after tests indicated the presence of diesel fuel in the drilling mud, which would be a violation of the project certificate.
Ohio regulators are pursuing hundreds of thousands in civil penalties against the project over numerous environmental violations alleged to have occurred during Rover's construction.
West Virginia regulators also recently ordered Rover to halt construction on one project segment due to violations of its state-issued water pollution control permit.
The highly anticipated project has seen the original July start-up on Phase 1 -- connecting producing areas of Ohio, West Virginia and Pennsylvania to the Midwest Hub in Defiance, OH -- slip to "late summer." Phase 2, which would bring the full designed capacity online and extend service to the Vector Pipeline in Michigan and the Dawn Hub in Ontario, is still scheduled for service in November, ETP has said.
The market has watched Rover's progress closely due to its potential to uncork significant new volumes of Marcellus and Utica shale production. News of the project's setbacks have come amid rising Northeast production and widening basis differentials at Appalachian hubs like Dominion South.