Pipeline Certificate Process Gets Face-Lift
Regulations pertaining to the construction of new pipeline
projects took the spotlight at FERC last week, with the Commission
issuing a final rule aimed at updating and streamlining the
certificate process for new projects, while at the same time
proposing an initiative that would give landowners greater
participation in the process.
The final rule, which was unanimously approved by the
Commission, expands the scope of blanket certificate authority for
pipelines under FERC's Part 157 regulations, and requires pipes to
comply up-front with a "minimum" checklist of environmental data to
enable FERC staff to conduct more timely project reviews [RM98-9].
The notice of proposed rulemaking (NOPR), on the other hand, seeks
to give "affected" landowners a greater voice in the certificate
process by requiring pipelines to notify them within three business
days of filing project applications at the Commission [RM98-17].
The majority of the initiatives, both final and proposed, were
designed to speed up FERC's review of pipeline projects, which has
been the target of industry criticism. Commissioner William Massey
believes requiring advance environmental information from pipelines
could avert significant delays later in the certificate process.
On the downside, however, "there's more potential for rejection
if [pipeline projects] don't meet the minimum checklist," said a
FERC staffer. "So [we've] put the onus on pipelines to come up with
a more complete application at the beginning..."
The Interstate Natural Gas Association of America (INGAA)
supported the measures. "We want to do our part to speed the
process up," said INGAA President Jerald Halverson.
As part of the rule, the pipelines received an expansion of
projects coming under blanket certificate authority, including
certain compression replacements and mainline/lateral additions,
which no longer will be subject to a lengthy certification process.
These now can be built by pipelines at their own risk and expense
without prior FERC approval.
The final rule also increased the spending limit on unopposed
construction projects that can be acted on by the director of the
Office of Pipeline Regulation from $5 million to $20 million.
Additionally, it gives pipelines the authority to automatically
abandon eligible facilities subject to obtaining written consent
from existing shippers.
The regulation would require pipelines to submit along with
their applications a list of all landowners that would be
"affected" by their projects. The NOPR seeks to take that one step
further by requiring pipelines to notify all "affected" landowners
by certified mail within three business days of filing applications
at the Commission. Presently, landowners aren't notified of
pipeline projects until much later in the process. The three-day
requirement would apply to Section 7 (c) projects and most
Massey said the NOPR would give landowners "earlier and more
meaningful" notice of projects. He added it was "essentially
consistent" with the "thrust" of the legislation proposed by Sen.
Fred Thompson (R-TN) last year. That bill required pipelines
seeking to seize private property for projects to alert affected
landowners by certified mail at the outset of FERC proceedings,
giving them an opportunity to participate more fully in the
process. The NOPR also was in keeping with INGAA's proposal to
notify affected landowners when a project application received a
docket number, which normally is the day after a project's filed.
The proposal "cast[s] a wide net" in defining who qualifies as
an "affected" landowner, according to Massey. It would cover those
whose property: 1) is directly affected by the proposed
construction activity, including all property subject to
right-of-way (ROW) and temporary work space; 2) abuts an existing
ROW in which the facilities would be constructed; 3) abuts a
compressor or liquefied natural gas facility; or 4) is in the
vicinity of new storage fields or proposed storage expansions and
any applicable buffer zone.
INGAA's Halvorsen said the pipeline group backed the
Commission's efforts to give landowners a greater role in the
certificate process by involving them earlier on, although he
conceded it could slow down project approvals. "We are all trying
to get a handle on the landowner issue. To do this, I think you
have to involve them early."