The proposed Independence Pipeline and MarketLink expansion -the two most controversial pipeline projects pending before FERC -have won final environmental clearance, which virtually cinchestheir approval at the Commission. Last March FERC assured sponsorsit would act on these two projects, as well as the proposedMillennium Pipeline, during its fall session. Both Independence andMarketLink are on the docket for FERC’s regular meeting next week.

Although the projects have been the target of intense landowneropposition, the final environmental impact statement (FEIS)concluded the greenfield Independence project and the MarketLinkexpansion would be an “environmentally acceptable action” if they”are constructed and operated in accordance with ourrecommendations.” Commission staff proposed a number of measures tomitigate the environmental impact of project construction, andrecommended that they be attached as conditions to anycertificates.

The favorable decision, according to staff, was owing in part tothe proposed routing of the Independence and MarketLink projectsalong existing pipeline and powerline rights-of-way (67% of theroutes), and Independence’s decision to sign a mitigation agreementwith Ohio to further reduce the impact of construction onagricultural lands.

Probably the most surprising action in the FEIS was staff’sdecision to discard the plethora of system alternatives toIndependence and MarketLink that were proposed by Texas EasternTransmission Corp. (Tetco), CNG Transmission and Tennessee GasPipeline. The alternatives offered the use of turned-back capacityto partly or completely replace the two projects.

Although staff acknowledged most of the proposed alternativeswere environmentally and financially superior to the two projects,it said they were based on “speculative” assumptions forturned-back capacity and, as a result, couldn’t serve assubstitutes for Independence and MarketLink. It further notedseveral of the proposed alternative projects hadn’t been fullydeveloped nor had they been formally filed at the Commission.

“We are not stating that turnback capacity-type alternatives arenot reasonable and prudent alternatives. On the surface, they wouldappear to be environmentally (and economically) attractive, if notenvironmentally preferable,” staff said in the FEIS. But thepipelines “arguing for turnback alternatives have not made theircase to date and it is not staff’s responsibility to make theircase for them.” In addition, the proponents of the systemalternatives “have a responsibility to file an application beforethe Commission for a certificate of public convenience andnecessity,” but none have done this so far, staff noted.

Specifically, staff frowned on Tetco’s lease alternative underwhich it would provide 663,000 Dth/d of firm capacity toIndependence and MarketLink shippers by using existing and futureturnback capacity on its system.

“….we believe that Texas Eastern’s suggested alternative isnot a viable alternative to the Independence Pipeline projectbecause the alternative would accommodate only 663,000 Dth/d asopposed to the 1 Bcf/d proposed by Independence, and thealternative depends both on already ‘noticed’ (300,000 Dth/d)turnback capacity but also on ‘speculative/prospective’ turnbackcapacity,” staff said.

Staff also shot down the so-called Atlantic Alliance Projectthat was proposed by CNG Transmission and Tennessee as systemalternatives to both Independence and Millennium Pipeline, which isstill awaiting a FEIS. Under this proposal, the pipelines said theycould provide up to 750,000 Dth/d of transportation capacity fromthe Chicago market to the Niagara Import point into easternmarkets, and would do this primarily by using existing facilities.

Subsequently, CNG Transmission proposed a “combined alternative”that would use existing and projected turnback capacity, combinedwith a small expansion of its system, to provide 1.6 Bcf/d ofcapacity to eastern markets. Staff rejected this outright too.”Again, we cannot recommend this alternative as a viablealternative because it has not been completely defined by CNG.”

Last July, the undaunted Tetco came up with another alternativethat would combine turned-back capacity on Tennessee, CNGTransmission and its system to provide a total of 741,000 Dth/d forleasing to Independence and MarketLink shippers. It described theproposed option as a “no cost, no new facilities, noenvironmental/landowner impact alternative,” according toCommission staff, who jettisoned the proposal as well. Staff saidit would require some construction of a portion of MarketLink butTexas Eastern did not specify the amount of facilities. Also, nodetails were presented as to how service/transportation/leaseswould work operationally. And it would accommodate only part of thevolumes proposed by Independence.”

Independence, as proposed, would run about 400 miles fromDefiance, OH, to the hub in Leidy, PA. Project sponsors are ANRPipeline, National Fuel Gas Supply and Transcontinental Gas PipeLine. From Leidy, Transco – the sole sponsor of MarketLink -proposes to loop about 154 miles of its existing system to carrythe gas to Pennsylvania, New Jersey and other eastern markets. Theproposed ANR-sponsored SupplyLink project, which is associated withIndependence, would entail about 72 miles of looping on ANR’sexisting system between Joliet, IL, and Defiance. SupplyLink wouldsupply Independence with Canadian gas from the Chicago marketthat’s being brought in now by the expanded/extended NorthernBorder Pipeline, and will be brought in by Alliance Pipeline in thefuture.

With respect to Independence, the staff FEIS recommended apartial alternative to the proposed route. It calls forIndependence to deviate from its proposed route in Seneca County,OH, and to follow the existing right-of-way (ROW) of Sun OilPipeline east for several miles, and then turn southeast tocontinue along Columbia Gas’ ROW for about 12 miles beforerejoining its proposal route near Attica, OH.

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