As T-shirted crowds of opponents and proponents lined the hallsof FERC yesterday, a small army of congressmen, staterepresentatives, local politicians and landowner representativesunloaded an arsenal on the $1.3 billion Independence/MarketLinkpipeline project, which would transport up to 1 Bcf/d of gas acrossOhio, Pennsylvania and New Jersey to New York City. It wasstrikingly clear that no pipeline project in history has been morestaunchly opposed.

The project was criticized for everything from lack of marketdemand to documented cases of landowner intimidation by the projectsponsors, which are subsidiaries of Coastal Corp. and The WilliamsCompanies.

Rep. Bill Pascrell Jr. (D-NJ), who requested FERC hold thespecial conference, presented in concise form nearly every argumentagainst the project that came up yesterday but he focused mainly onthe lack of market demand for the proposed pipeline capacity.

“If all that is required for a company [to show market demandfor a pipeline project is] to go out and find a way to meet acapacity percentage, then companies will do as Independence andTransco have done; they will enter into precedent agreements withaffiliates, such as Engage, such as Westcoast, for two thirds ofthe capacity or close to it and then claim that as evidence of truedemand,” he said. “If you can’t say where the market is, then youcan’t say exactly what facilities you need to build…

“I’m not the first to make this argument,” he added. “Where didI first find it? In the Commission’s [new] policy statement issuedjust two weeks ago in a section called ‘drawbacks on currentpolicy.’ While there is some dispute as to whether this policystatement officially applies to the consideration of thisapplication, what you have stated is none the less critical to ourdiscussion today. Your words signal that you believe we cannot lookat these applications in a vacuum and I agree.” He cited a passagein the policy statement in which the Commission acknowledged thedifficulty in justifying taking private property to build apipeline based simply on non-binding written agreements. “I urgeyou to listen to your own words because you’re right. Market demandcannot be created only by papering together a certain percentage ofcapacity in agreements. It takes more than that.”

Next, Pascrell brought up an issue that repeatedly surfaced asone of the major reasons Independence/MarketLink is not required:expected turned back capacity on multiple other pipelines. “In theopinion of Texas Eastern Transmission Corp. (Tetco), the use ofturned back capacity in the Northeast would be sufficient enough tosatisfy any new increase in natural gas demand,” he noted.

In later testimony, Tetco’s Gregory Rizzo said his companyexpects 500 MMcf/d of capacity to be turned back by Nov. 1, 2000,which is the proposed in-service date of Independence/MarketLink.Rizzo presented an alternative project, which has not yet beenfiled, that would use that 500 MMcf/d of turned-back capacity andadd a few new facilities for a total cost of about $370 millioncompared to Independence/MarketLink’s $1.3 billion. Tetco’s projectwould use 60% less horsepower, 75% less pipeline, and would requireno new construction in New Jersey, the state in which there isunanimous opposition among elected officials toIndependence/MarketLink.

Independence/MarketLink project sponsors apparently have donequite a lot to hurt themselves in New Jersey and Ohio. In dramaticfashion, Wood County, NJ, Commissioner Timothy J. Brown came totell FERC about what he described as the “devious, underhanded,snake-oil-salesman methods Transco is using” in negotiations withlandowners. “Intimidation is the name of the game,” said Brown.”The tactics being used to coerce and scare the public arerepugnant. These tactics must be investigated and haltedimmediately..,” he said. “All it takes for evil to triumph is forgood people to do nothing.”

Other landowner representatives referred to cases in which thepipeline sponsors lied about the project, saying it already hadbeen approved and telling landowners they had better take thelittle money being offered for their property or they wouldn’t geta dime.

Williams Executive Vice President Cuba Wadlington showed couragein testifying last. He said he would take immediate action againstany acts of landowner intimidation by Williams employees. “I do nothave any snake oil on my body,” he said. “And while I’m 64 inchestall and weigh 230 pounds and I’m black, I do not think I’mintimidating. I have a very friendly face. Since I’m not apolitician or a spinster, I will not attempt to put the polish andwax that some have put on these issues prior to my opportunity [tospeak],” he said.

Regarding market demand for the project, Wadlington saidMarketLink now is 100% subscribed. “As recently as last night wehad the last piece signed up for,” he said.

Despite the record number of letters of opposition andintervenors in this case, Wadlington attacked his attackers, sayingall those who are in opposition are doing so for “their own specialinterests, whether running for office or to make their own living.Less than 5% of the opposition comes from landowners,” he claimed,noting that 33% of the right of way already has been acquired byTransco.

On the issue of potential turned-back capacity, he said “thosewho are raising it are being disingenuous and are misleading theCommission… It has nothing to do with physical flow because thatcontinues to grow.” There is contract turnover and requests forshorter contracts and different terms but all the existing capacitywill be utilized and expansions are needed, he said.

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