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Sunoco Building Case for Public Utility Status in Pennsylvania

Sunoco Logistics Partners LP is pushing back against two administrative law judges (ALJ) who recommended in July that the Pennsylvania Public Utilities Commission (PUC) not grant the company public utility status for its Mariner East pipeline.

In a 24-page document, the ALJs said Mariner East does not serve the public interest (see Shale Daily, Aug. 1). The document cited state law and said a declaratory judgement issued by the Federal Energy Regulatory Commission last year "supports the conclusion that Sunoco's proposed transport of ethane and propane through the state of Pennsylvania at FERC-approved rates is interstate common carrier service regulated by FERC through the Interstate Commerce Clause, rather than intrastate public utility service."

But in a filing last week with the PUC, Sunoco cautioned against the recommendation and said the ALJs misinterpreted the precedents set by state courts and the PUC itself. The company added that its plans to deliver propane to Pennsylvania customers along the line will ultimately benefit the public and support utility status as a result. 

Sunoco first filed its request in March after it became clear that some townships in the southeastern part of the state near Philadelphia would not facilitate the development of more than 30 valve and pumping stations that would be needed to help move natural gas liquids (NGL) through the line (see Shale Daily, April 28). If granted public utility status, the pipeline would not be subject to local zoning ordinances.

Most of Mariner East already exists, and Sunoco wants to expand the line to gather NGLs from Ohio and southwest Pennsylvania, where it would originate for delivery to the Marcus Hook Industrial Complex and storage facilities in Delaware County, south of Philadelphia (see Shale Daily, Sept. 9).

A number of environmental organizations opposed to the project have until the end of this week to file objections or new arguments for review before the five-member PUC will decide on Sunoco's request. A hearing has not yet been scheduled on the matter. 

The PUC could not be reached to comment on Tuesday. Earlier this month, Sunoco said after the ALJ’s recommendation that it believes the five-member commission will “recognize that the proposed Mariner East service will result in numerous public benefits” and it was awaiting the commission’s decision.

Propane and ethane service on the line is expected to begin by next year.

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