Tony Clark is a former FERC commissioner and he spoke about the situation with FERC being unable to function and what he thought the future of the FERC was. It’s an interesting interview, and just under eight minutes long.
Category Archives: Pipelines
FERC Soon to be Back in Business
The FERC has been operating without a quorum, unable to make major decisions regarding major pipeline projects. That’s created some uncertainty around the Mountain Valley Pipeline and the Atlantic Coast Pipeline, both of which are up for approval in the very near future.
That will soon change. The Trump Administration has nominated two people to fill some of the vacancies at the FERC.
Once they are approved by the Senate, the FERC will be able to make decisions such as approving the aforementioned pipelines.
It’s expected that approval hearings will take place in early June, about a month away. However, Democrats could decide to slow things down. Having FERC non-operational would make the environmental wing of the Democrat party very happy.
It will be interesting to see what political wranglings take place over these nominations.
UPDATE: May 17, 2017 — Like clockwork, opposition to the nominations has begun. Some want to keep the FERC hamstrung for environmental reasons, and some want a Democrat nominated along with the Republicans. We’ll see how long it takes to go through the Washington political machine.
Ohio EPA Not Happy with Rover Pipeline
The Rover Pipeline has been under construction in Ohio for about two months at this point. It’s not making a lot of friends.
The Ohio EPA has fined Rover $431,000 for 18 separate violations.
That’s a big number, but for a project that’s going to cost an estimated $4,200,000,000, it’s kind of small.
What’s really interesting is that the head of the EPA is frustrated with Rover’s attitude. In the Columbus Dispatch article linked above, he says, “All told, our frustration is really high. We don’t think they’re taking Ohio seriously. Normally when we have … a series of events like this, companies respond with a whole lot of contrition and whole lot of commitment. We haven’t seen that. It’s pretty shocking.”
If Rover doesn’t get its act together, they may find themselves facing a stop work order from the State of Ohio. They were able railroad landowners using federal law, but they are up against an entirely different animal when they tick off the head of a State agency that has the power to stop them in their tracks.
This also doesn’t inspire confidence that the end product is going to be well built. Management problems trickle down to workers, and quality suffers. It’s the natural way of all organizations.
UPDATE: May 11, 2017 — The FERC has halted drilling by the Rover Pipeline at eight locations in Ohio. Drilling already in progress is going to continue, as stopping the drilling increases the risk of collapse and spills. The Tuscarawas River location will have independent third-party oversight. Rover also has to double the number of environmental inspectors per construction spread.
UPDATE: May 16, 2017 — It turns out that the fine was not a fine, but a penalty that it will have to pay and that can be negotiated. A spokesman for the Ohio EPA seems to have made that comment that’s quoted above, not the head of the Ohio EPA, and everything about the situation is pretty fluid. It’s more than a little disappointing when facts get distorted by the news outlets. Who do you trust?
Mountain Valley Pipeline’s 401 Permit Challeneged
The State of West Virginia issued a 401 water quality permit for the Mountain Valley Pipeline back in March.
Opponents of the pipeline say the DEP’s review of the permit application was deficient.
Appalachian Mountain Advocates, represented by Derek Teaney, has sent the DEP a letter listing the allegations.
What I’ve heard through the grapevine is that the MVP did a lot of copying and pasting in it’s application. While some copy-pasta should be expected in an application of that sort, some things that should have received a more personal touch didn’t.
If the DEP doesn’t provide a satisfactory response there will most likely be a lawsuit in the works.
Rover Pipeline Drilling Mud Leak Update
A directional drilling rig working on the Rover Pipeline leaked a bunch of drilling fluid while it was drilling under the Tuscarawas River a little while ago. This article from WMFD.com, a local news outlet, is a follow up story highlighting the efforts to clean the mess up and some doubts by the landowner as to whether the clean up is going well.
The Rover representative quoted in the article downplayed the seriousness of the spill, of course. The Ohio EPA will still be levying fines and monitoring the clean up, so I guess it’s serious enough for that.
We previously noted that Rover is off to a pretty bad start and that all of it’s mistakes are going to shake confidence in the pipeline industry. We haven’t seen anything to change that opinion yet.
Pipeline Leak: Mariner East 1
The Mariner East 1 pipeline sprung a leak on April 1st, 2017. The leak was from an 8-inch steel pipe. The pipeline was shut down, and repairs carried out over the course of several days.
It was a small leak, just 20 barrels of ethane and propane. No one was injured, and no water was contaminated.
It’s important to note that the company “was informed of the leak”. Makes it sound like someone other than the company was responsible for discovering the leak.
This is the first pipeline leak we’ve run across this month. While it’s small, it’s important because people need to know that pipelines leak and that the company doesn’t usually discover the leaks, especially when they’re “small”. The safety technology they use doesn’t detect the small stuff well.
Pipeline Opposition: Rover Pipeline Spills 2 Million Gallons of Drilling Fluid in Wetlands
The Rover Pipeline is a big project that starts in the northern part of West Virginia, crosses Ohio, and heads up to Canada. Construction began about a month ago. They’ve been very busy cutting trees and clearing the right of way since then. They’ve also been busy getting in trouble.
The Ohio EPA has already issued the Rover Pipeline a Notice of Violation for spilling 2 million gallons of drilling fluid in one location, and 50,000 gallons in another.
The Rover Pipeline already has a checkered reputation as far as construction work goes. It demolished a historic house that was being considered for the National Register of Historic Places. It also got an injunction against landowners who were trying to stop Rover from coming onto their property, but forgot to include most of the landowners with whom the Rover Pipeline had not been able to get easement agreements from.
Basically, it feels like this project which has been in the planning stages for years is not well planned.
It does not inspire confidence that the final product will be high quality (or in other words safe).
It also does not inspire confidence that the other major pipeline projects, the Atlantic Coast Pipeline, the Mountain Valley Pipeline, and the Mountaineer Xpress, will be any better.
Is There A Need for the Atlantic Coast Pipeline?
One argument that opponents of the Atlantic Coast Pipeline are making is that there simply isn’t a need for it.
This is an important argument to make, because one of the main factors that the FERC looks at when deciding whether to approve a pipeline is whether there is a need for the gas.
An article by Samantha Baars on c-ville.com looks into the question a little better than most I’ve seen.
She interviewed Greg Buppert, a lawyer for the Southern Environmental Law Center (SELC) and looked at data from the Dominion Energy and Duke Energy, the main companies backing the pipeline, and from PJM Interconnection, a group that controls the electricity grid in Virginia.
The data from Dominion/Duke and from PJM are significantly different.
Dominion/Duke say that Virginia will need 24,016 megawatts of electricity in 2017. PJM says Virginia will only need 20,501 megawatts.
Dominion/Duke says that PJM doesn’t take into account some factors that it should.
PJM, however, is responsible for running the grid. If PJM doesn’t get the numbers right, it would be left scrambling to find other sources of power on short notice. PJM doesn’t just have money as a motivating factor. I lean towards trusting PJM more than Dominion/Duke on this one.
It’s possible that there isn’t enough demand for electricity in Virginia to warrant building the pipeline. If that’s so, then there’s a real case to be made that the FERC should not approve the Atlantic Coast Pipeline.
New West Virginia Pipeline Project: Buckeye Xpress. How You Should Prepare.
TransCanada has proposed a new pipeline in the northern panhandle of West Virginia. It’s called the Buckeye Xpress (no E on the front of Xpress).
The Buckeye Xpress will move gas from the Sherwood plant in Doddridge County to the Oak Grove processing plant in Marshall County, from the Oak Grove plant to the Seneca plant in Noble County, OH, from Oak Grove to the Majorsville plant in Marshall County, and will pick up gas between the Waynesburg compressor station and the Smithfield compressor station.
Unfortunately, WordPress is acting up on me and not allowing me to put a map on here. The only map I could find is pretty vague and mostly useless for determining whether the route is on your property.
If you’re on the route, you’ll want to stay ahead of the action as much as possible. What do I mean by that?
Well, we’ve watched a handful of our clients go through the process with the Atlantic Coast Pipeline. We’ve learned a thing or two, and here’s what you need to know.
First, they absolutely do not have the right in West Virginia to enter your property to survey until after they get FERC certification, which is going to take years. If you find a survey crew on your property without permission you can ask them to leave and they have to leave. If the surveyors say they have the right to be there they are either ill-informed or lying. You can literally call the sheriff and have them escorted off the property.
Second, if you don’t want the pipeline to cross your property you’re going to have to give them a good reason not to be there. This project will be seeking FERC approval, and when it gets FERC approval it will have the power of eminent domain. If they really want your little piece of almost heaven, they will be able to take it. You need to give them a rational, logical, verifiable reason not to take it. Things they want to avoid are environmentally sensitive areas, wetlands, historic sites and graveyards, and places where the ground is likely to slip. If you can show them that it will be easier (or less expensive) for them to go on your neighbor’s property they probably will.
Third, if you don’t mind them crossing your property but you would prefer that they move to a different part of it, you need to tell them so immediately. The pipeline will usually be willing to work with you on the location, but if you wait until they’re a long ways into the process they’re less willing to work with you.
Fourth, if you have plans to build on or subdivide your property in the future you need to get those plans on paper and filed in the courthouse or under contract now. You’ll want to make sure that you get compensated for what you plan to do with your property. The standard for measuring compensation for your property is it’s current actual use, not any possible future uses. If you want to build a house on the ridgetop and you think you might be on the pipeline’s path, go pull a building permit and get some estimates from contractors and stake out the location. Maybe even dig and pour a foundation. If you want to sell lots on your property go get it surveyed and have the survey filed at the courthouse. Stake out the lots. Build a road and lay some water lines electric lines or something that shows you are actually going to develop it. You need documentation that would hold up in court that will show that your property is not just pasture or steep timberland.
Those last suggestions could be expensive, of course. Only undertake them if you already intend to do those things. If the pipeline doesn’t come across your property and you’ve spent money on any of those things hoping to increase the value of your property you’ll lose money. You should only do those things if you are already planning to do them in the next few years anyways. This is only a suggestion to bump your timeline forward to today.
And one last bit of advice from someone who negotiates with oil and gas companies all the time–be nice (but firm) to the pipeline guys and you’re more likely to get concessions from them.
Good luck. Luck favors the prepared.
Atlantic Coast Pipeline: A Small Scandal
As it turns out, there may be some conflicts of interest for some of the people that have been working for FERC on the Atlantic Coast Pipeline.
The FERC contracts out some of the work it does reviewing the pipeline application. Merjent was hired by the FERC to review the ACP’s Environmental Impact Statement.
The EIS was put together by a company called Natural Resources Group.
There are eight Merjent employees who previously worked for Natural Resources Group.
All eight of those Merjent employees approved the work Natural Resources Group did on the ACP.
Looks like a pretty clear conflict of interest there.
That conflict of interest was supposed to have been disclosed when Merjent got the contract from the FERC. It wasn’t.
Interestingly, Natural Resources Group is listed on Merjent’s web site as one of Merjent’s clients.
That looks pretty bad.