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ACP Facing More Work Stoppages After Court Vacates Another Permit

Environmental groups are stepping up their calls to stop all construction along the Atlantic Coast Pipeline’s (ACP) 600-mile route after a federal appeals court on Monday vacated a key right-of-way (ROW) issued by the National Park Service (NPS).

Analysts said at at the least, more work stoppages are ahead as the project faces challenges similar to those being confronted by the Mountain Valley Pipeline (MVP), which has been halted by FERC because of decisions handed down by the same appeals court.

“Given the Federal Energy Regulatory Commission’s recent decision to stop construction based on an invalid right-of-way permit in the case of the Mountain Valley Pipeline, FERC should immediately halt all construction on the Atlantic Coast Pipeline,” said Southern Environmental Law Center senior attorney Greg Buppert. “It’s time to pause and take a look at this project for what it is, an unnecessary pipeline that’s being pushed through to benefit Dominion Energy, not the people of Virginia and North Carolina.”

The U.S Court of Appeals for the Fourth Circuit already vacated the incidental take permit issued by the U.S. Fish and Wildlife Service (FWS). The permit is required for activities that could result in the take of, or negative impact to, threatened wildlife, prompting ACP to stop work in May on about 100 miles of the system in West Virginia and Virginia. The court found that FWS failed to set adequate limitations on the harm the project might cause five threatened or endangered species.

As part of a broader consolidated case brought by the Sierra Club and other environmental groups, the appeals court’s decision three months ago did not include a full opinion. In finalizing the ruling on Monday, the court also found that the NPS failed to explain how its approval of the ROW is consistent with its conservation duties under the Blue Ridge Parkway Organic Act. While project construction wouldn’t disturb the parkway’s ROW, as it would be installed beneath the surface, a 125-foot construction corridor would need to be cleared in what the court said would affect views from the parkway’s scenic overlooks.

“We think this order could prompt FERC to issue a full work stoppage on ACP too, although it may take several more business days for this to occur,” said ClearView Energy Partners LLC analysts, noting the ROW problem that ACP now faces. “An alternative and, we think, less likely scenario, would involve FERC issuing more limited stop work orders for ACP, perhaps relying on the difference in judicial review landscapes the projects face.”

The court’s decision to finally vacate ACP’s incidental take statement and ROW approval came just days after FERC ordered MVP to stop all construction along its 300-mile project. In that case, the Fourth Circuit vacated decisions by the U.S. Forest Service and the Bureau of Land Management that allowed MVP to cross a 3.5 mile segment of the Jefferson National Forest in Virginia and West Virginia. FERC leaned heavily on MVP’s vacated ROW across federal land that was approved by the BLM in deciding to halt construction.

“If FERC judges the ROW problem for ACP as having the same magnitude as MVP’s, then a full stop work order looks very likely,” ClearView said.

In the web of litigation that has wrapped itself around both projects, the Fourth Circuit has also granted a motion filed by environmental groups to stay MVP’s Nationwide Permit (NWP) 12, which allows contractors to trench through the bottom of streams and rivers. The Sierra Club argued that MVP could not meet a special permitting condition requiring all stream crossings be constructed within 72 hours. The groups are now pursuing the same argument against ACP’s NWP 12, even though that project’s sponsors contend they can make the crossings in the allotted amount of time.

“Given that other litigation against other APC permits remains pending and adverse rulings occasioning incremental schedule delays are still possible, FERC would appear to have cause to stop all work at this time,” ClearView analysts said.

ACP’s incidental take statement and ROW approval have been remanded to the respective agencies for revisions. It’s unclear how long that process might take. ACP spokesman Aaron Ruby said the project would work with the agencies to resolve the issues and added that sponsors believe the court’s concerns can be addressed through additional review without causing unnecessary delay. He noted that ACP has already provided the FWS with the information needed to revise the incidental take statement and management believes the agency will do so shortly.

“With respect to the National Park Service’s approval to cross the Blue Ridge Parkway, the court’s opinion confirms the agency’s authority to issue the permit but remands the permit to allow the agency to correct certain errors and omissions in the permit record,” Ruby said. “We believe the extensive public record and mitigation requirements already in place provide ample support for the agency to promptly reissue the permit.”

The Blue Ridge Parkway is part of the NPS system, linking the Shenandoah National Park in Virginia to the Great Smoky Mountains National Park in North Carolina. Ruby said as the regulatory process unfolds, ACP would continue work in West Virginia and North Carolina.

ACP would originate in West Virginia, pass through Virginia and into North Carolina to move 1.5 Bcf/d of Appalachian natural gas to the Southeast. The project, backed by Dominion Energy Inc., Duke Energy Corp., Piedmont Natural Gas and Southern Company Gas, is targeting a 2019 in-service date.

The 2 Bcf/d MVP would follow a similar path to serve the Southeast. The projects have faced criticism over those similarities and the potential environmental impacts two pipelines can create. Because of regulatory and legal issues, MVP’s target start date has already been pushed back by three months to 1Q2019.

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