Regulations pertaining to the construction of new pipelineprojects took the spotlight at FERC last week, with the Commissionissuing a final rule aimed at updating and streamlining thecertificate process for new projects, while at the same timeproposing an initiative that would give landowners greaterparticipation in the process.

The final rule, which was unanimously approved by theCommission, expands the scope of blanket certificate authority forpipelines under FERC’s Part 157 regulations, and requires pipes tocomply up-front with a “minimum” checklist of environmental data toenable FERC staff to conduct more timely project reviews [RM98-9].The notice of proposed rulemaking (NOPR), on the other hand, seeksto give “affected” landowners a greater voice in the certificateprocess by requiring pipelines to notify them within three businessdays of filing project applications at the Commission [RM98-17].

The majority of the initiatives, both final and proposed, weredesigned to speed up FERC’s review of pipeline projects, which hasbeen the target of industry criticism. Commissioner William Masseybelieves requiring advance environmental information from pipelinescould avert significant delays later in the certificate process.

On the downside, however, “there’s more potential for rejectionif [pipeline projects] don’t meet the minimum checklist,” said aFERC staffer. “So [we’ve] put the onus on pipelines to come up witha 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 theprocess up,” said INGAA President Jerald Halverson.

As part of the rule, the pipelines received an expansion ofprojects coming under blanket certificate authority, includingcertain 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 expensewithout prior FERC approval.

The final rule also increased the spending limit on unopposedconstruction projects that can be acted on by the director of theOffice of Pipeline Regulation from $5 million to $20 million.Additionally, it gives pipelines the authority to automaticallyabandon eligible facilities subject to obtaining written consentfrom existing shippers.

The regulation would require pipelines to submit along withtheir applications a list of all landowners that would be”affected” by their projects. The NOPR seeks to take that one stepfurther by requiring pipelines to notify all “affected” landownersby certified mail within three business days of filing applicationsat the Commission. Presently, landowners aren’t notified ofpipeline projects until much later in the process. The three-dayrequirement would apply to Section 7 (c) projects and mostblanket-certificate projects.

Massey said the NOPR would give landowners “earlier and moremeaningful” notice of projects. He added it was “essentiallyconsistent” with the “thrust” of the legislation proposed by Sen.Fred Thompson (R-TN) last year. That bill required pipelinesseeking to seize private property for projects to alert affectedlandowners by certified mail at the outset of FERC proceedings,giving them an opportunity to participate more fully in theprocess. The NOPR also was in keeping with INGAA’s proposal tonotify affected landowners when a project application received adocket number, which normally is the day after a project’s filed.

The proposal “cast[s] a wide net” in defining who qualifies asan “affected” landowner, according to Massey. It would cover thosewhose property: 1) is directly affected by the proposedconstruction activity, including all property subject toright-of-way (ROW) and temporary work space; 2) abuts an existingROW in which the facilities would be constructed; 3) abuts acompressor or liquefied natural gas facility; or 4) is in thevicinity of new storage fields or proposed storage expansions andany applicable buffer zone.

INGAA’s Halvorsen said the pipeline group backed theCommission’s efforts to give landowners a greater role in thecertificate process by involving them earlier on, although heconceded it could slow down project approvals. “We are all tryingto get a handle on the landowner issue. To do this, I think youhave to involve them early.”

Susan Parker

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