Regulations pertaining to the construction of new pipelineprojects took the spotlight at FERC yesterday, with the Commissionapproving a final rule aimed at updating and streamlining thecertificate process for new projects, including a change in thetimetable for the filing of project-related environmental data.FERC also proposed an initiative that would give landowners greaterparticipation in the certification process.

The companion measures unanimously approved by the Commissioninclude a rule that expands the scope of blanket certificateauthority for pipelines and requires them to comply up front with a”minimum” checklist of the environmental data needed for FERC staffto initiate a project review [[RM98-9, RM98-17]. FERC also made anumber of other changes to its Part 157 regulations and issued anotice of proposed rulemaking (NOPR) that would require pipelinesto notify “affected” landowners within three business days offiling their project applications.

“Since environmental review of an application consumes thelion’s share of time spent processing, following this checklistwill facilitate prompt consideration of applications,” CommissionerWilliam Massey said. On the downside, however, pipelines could facea “potentially sterner test” when they file project applications asa result of the “checklist” requirement, a FERC staff member noted.”There’s more potential for rejection if they don’t meet theminimum checklist, which was not there before. So [we’ve] put theonus on pipelines to come up with a more complete application atthe beginning…”

Commissioner Linda Breathitt stressed the final rule will notrequire pipes to submit more environmental data than they do now -it only requires that the data be submitted up front when a projectapplication is filed. Those applications not satisfying “a minimumportion of these environmental requirements risk being rejected.”

The Interstate Natural Gas Association of America (INGAA)applauded the final changes the Commission made to its Part 157regulations, the requirement that pipelines file environmental dataup front and the landowner-notification NOPR. “We think the morestuff we can put up front the better. It will shorten the process.We want to do our part to speed the process up” at FERC, said INGAAPresident Jerald Halverson.

In the final rule, the Commission expanded blanket certificateauthority for pipelines to include certain compression replacementsand mainline/lateral additions, provided the “increases in capacityare incidental in nature.” This was especially good news forpipelines because it means that a lot of routine projects – whichnow are being treated as major Section 7 (c) applications andsubjected to a lengthy certification process – can be built bypipelines at their own risk and expense without prior FERCapproval.

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.

Moreover, the rule requires a pipeline to submit a list of alllandowners that would be “affected” by its project along with itsapplication, while the NOPR calls on the pipeline to notify all”affected” landowners by certified mail within three business daysof applying at the Commission. In the past, landowners weren’tnotified of pipeline projects until later in the process – whenFERC issued a notice of intent to prepare an environmental impactstatement or an environmental assessment. The three-day requirementwould apply to Section 7 (c) projects and most blanket-certificateprojects.

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 requiring pipelines that intended toseize private property for projects to alert affected landowners bycertified mail at the outset of FERC proceedings, giving them anopportunity to participate more fully in the process. The NOPR alsowas in keeping with INGAA’s proposal to notify affected landownerswhen a project application received a docket number, which normallyis the day after a project is filed.

In the proposed rule, the Commission also recommended thatinterstate pipelines conduct public meetings prior to filing theirproject applications to “foster better information flow to thecommunities,” a staff member said.

The proposal “cast[s] a wide net” in defining “affected”landowners, according to Massey. Specifically, FERC said “affected”landowners were those whose: 1) property was directly affected bythe proposed activity, including all property subject toright-of-way and (ROW) temporary work space; 2) property abutted anexisting ROW in which the facilities would be constructed; 3)property abutted a compressor or liquefied natural gas facility; or4) property was in new storage fields or expansion of storagefields and any applicable buffer zone.

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