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REX Moves to Block Stay of Ohio Pipeline Construction

A motion by Murray Energy Corp. for an immediate stay of construction on a 20-mile stretch of the REX-East Pipeline in eastern Ohio should be denied, according to a response filed at FERC Thursday by Rockies Express Pipeline LLC (REX).

In its filing with the Federal Energy Regulatory Commission (FERC), Murray requested an immediate stay of pipeline construction activities between mileposts 608.9 and 639.1, an area known as "Spread K." FERC authorized construction of the Spread K portion of the pipeline on March 19. Murray previously requested a rehearing of that decision.

Construction of the Spread K portion, which crosses approximately eight miles of Murray-controlled coal reserves, would cause "irreparable injury" to Murray, the company said. Murray said the pipeline will be built directly over its active underground longwall coal mining operations. REX's construction plans "pose grave dangers to underground mine workers, the public and the REX pipeline itself," Murray said in its filing. "REX is relying on a hastily prepared flawed plan, which this Commission has not reviewed and approved."

In its response, REX asked FERC to deny Murray's request, which it said included "self-serving conclusory statements and mischaracterizations" of statements made by REX consultants. The Murray filing provided no new information and none of the details of the issue have changed since FERC authorized construction in March, REX said. Since then Murray has attempted to block construction in state and federal courts in Ohio, but "it correctly failed at every turn," according to REX.

"Murray has shown that it will go to any forum and make any argument, no matter how unsupported or incendiary, to extort money for its unaffected interests," REX said.

Murray and REX have squabbled over the pipeline's construction plans since FERC authorized the start of construction last year (see Daily GPI, July 10, 2008). Within days, REX asked FERC to schedule a technical conference to discuss how the company might pursue an environmental construction requirement for its 639-mile Rex-East Pipeline to cross Murray's coal reserves, saying it might need an alternative route (see Daily GPI, July 24, 2008). A certificate issued by FERC last year (see Daily GPI, June 2, 2008) directed REX to develop a plan with Murray that would "maintain pipeline integrity and operation while not impeding the mining operation." Failing that the company could offer an alternative route.

In its most recent filing, REX says "there is no evidence that Murray will be prevented from mining its coal." REX said it has committed to extensive mitigation measures to assure that Murray's coal mining operations may take place.

REX is "about two-thirds finished" and the REX-East portion that runs to Lebanon, OH, will be ready for service by the end of this month, Kinder Morgan Energy Partners LP CEO Rich Kinder said Tuesday (see Daily GPI, June 4).

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