Underground Construction - October 2017 - 8

WASHINGTONWATCH

By Stephen Barlas, Washington Editor

Pipeline Construction Projects
Move Forward With Full FERC

T

The Federal Energy Regulatory Commission (FERC) is off and running
now that it has three commissioners to form a quorum, with two
more likely to fill out the five total
chairs once confirmed by the Senate,
maybe as early as September. The
commission started to work through
the backlog of pipeline construction projects waiting for a quorum
by approving the Nexus pipeline on
August 28, 2017. Neil Chatterjee,
the new temporary chairman; Cheryl
A. LaFleur, the one holdover commissioner and Robert F. Powelson,
the second new commissioner, said
NEXUS "...has taken suﬃcient steps
to minimize adverse impacts on
landowners and surrounding communities."
The Senate Energy Commission
met on Sept. 7 to consider nominations of Richard Glick and Kevin
McIntyre, who would be the new
chairman, to FERC.
The $2 billion, 255-mile pipeline
will bring shale gas from Appalachia
into Michigan and Ontario, Canada.
NEXUS is jointly owned by Spectra
Energy Partners LP and DTE Energy
Company. Spectra is a subsidiary of
Enbridge.
NEXUS obtained easements for
over 93 percent of the project route
without the use of eminent domain.
The FERC approval statement said
the fact that such a large portion of
the project route has been acquired
without use of eminent domain
strongly supports a finding that the
applicants' efforts have minimized
the potential for adverse impacts on
landowners and surrounding communities.
Among the next projects seemingly on track for approval is Dominion Energy's Atlantic Coast Project
(ACP), the huge, nearly 600-mile
pipeline which the FERC staff blessed in a final environmental impact
statement in July. Gas would come
from Pennsylvania and be sent to
West Virginia, Virginia and North
Carolina. The staff environmental
impact statement (EIS) said the project would result in limited adverse

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environmental impacts, with some
exceptions. One concern is that numerous segments of pipeline would
be constructed on steep slopes and
in areas of high landslide potential.
Building on slopes adjacent to water
bodies can also adversely impact
water quality and stream channel geometry, and therefore, downstream
aquatic biota.
"We've made more than 300
route adjustments to avoid environmentally sensitive areas and protect
important features of individual
properties," said Leslie Hartz, Dominion Energy's vice president, engineering and construction. "We've
adjusted the route to avoid wetlands,
public and private drinking water
sources, wildlife habitats, sensitive
karst terrain, and many other environmental resources. In many areas
of the project, we've adopted some
of the most protective construction
methods that have ever been used by
the industry."
But environmental groups are
working hard to short-circuit FERC's
expected approval. "Despite all its
rhetoric, FERC continues to prove
it's nothing more than a rubber
stamp for fracked gas pipelines that
threaten our communities and our
climate," said Deb Self, a Sierra Club
Beyond Dirty Fuels Campaign representative. Sierra and others are hoping to convince the states of West
Virginia, Virginia and North Carolina
to reject water quality permits, and
persuade the Forest Service and
Bureau of Land Management to nix
the pipeline's crossing of land in its
jurisdictions.
"We fully expect to receive all
state and federal approvals this fall,
including the Forest Service permit
and the state water quality certifications, " said Aaron Ruby, spokesman
for Dominion. He calls press releases
issued by the Sierra Club "just typical
bluster," and points out that on the
day the FERC issued its final EIS, the
Forest Service issued a draft Record
of Decision recommending approval
of Atlantic's special use permit to
cross Forest Service lands.

The 303-mile Mountain Valley
Pipeline, which has raised hackles
from some in Appalachia who are
also protesting the Atlantic Coast
Pipeline, is also in front of the commissioners given the final EIS issued
in late June. This pipeline runs
from northwestern West Virginia to southern Virginia and will be
constructed and owned by Mountain
Valley Pipeline LLC, a joint venture
with EQT Midstream Partners.
Rounding out the list of large,
Marcellus shale-originating pipelines
queued up for FERC approval is the
120-mile PennEast Pipeline which
will originate in Dallas, Luzerne
County, in northeastern Pennsylvania, and terminate at Transco's
pipeline interconnection near Pennington, NJ. NJR Pipeline Company,
PSEG Power, SJI Midstream, Southern Company Gas, Spectra Energy
Partners and UGI Energy Services
are the member companies that
form PennEast Pipeline Company
LLC (PennEast).
Here, too, environmentalists
hope to convince state agencies to
block permits, in this case the New
Jersey Department of Environmental Protection, which in June
deemed the company's application
for a freshwater wetlands individual
permit and a water quality certificate
"administratively closed."

ExxonMobil Earns Significant Legal
Victory Over PHMSA
ExxonMobil Pipeline won a significant decision against the Pipeline
and Hazardous Materials Safety
Administration (PHMSA), when a
federal appeals court threw out most
of a PHMSA enforcement action and
penalty related to a 2013 oil spill in
Arkansas. At issue in the action was
whether ExxonMobil should have
known that a segment of low-frequency electric resistance welded
(LF-ERW) pipe was susceptible to
longitudinal seam failure under
federal pipeline safety regulations,
more specifically, oil pipeline integrity rules.

The Pegasus Pipeline is a 20-inch
diameter pipeline approximately 850
miles in length that transports crude
oil from Patoka, IL, to Nederland,
TX. The failure site was in a High
Consequence Area. The released
product entered the community's
storm drainage system.
Susan Olenchuk, partner, Van
Ness Feldman LLP, said the Fifth
Circuit decision is significant because
it is rare for a pipeline operator to
challenge a PHMSA enforcement
decision, let alone succeed. "The
case also is important because, even
though agencies are usually given
a high degree of deference in how
they interpret their own regulations,
the court of appeals refused to defer
to PHMSA's interpretation of its
own safety regulations in a case that
arose out of high-profile and damaging rupture of a crude oil pipeline,"
she explained.
Integrity rules dictate that a
company determine prior to using
LF-ERW whether the pipe is susceptible to longitudinal seam failure
by methods "capable of assessing
seam integrity...." The law neither
mandates how operators should
determine longitudinal seam failure,
nor does the law dictate a process for
operators to follow, according to a
legal brief ExxonMobil filed in 2015
disputing the $2.6 million penalty
PHMSA assessed.
The Fifth Circuit court, headquartered in Atlanta, wrote: "The record
demonstrates that ExxonMobil
satisfied its obligation to 'consider'
various risk factors when it conducted a lengthy, repeated and in-depth
analysis of those risk factors by utilizing the available industry-commissioned guidance of the Baker Report
decision tree."
The court went on to essentially
chastise PHMSA by saying nothing
in the regulations compels an operator to conclude that a pipeline
constructed of LF-ERW pipe is susceptible to longitudinal seam failure
when the pipeline has experienced
seam failures. "If the agency wished
to enforce outcome-based requirements instead of the process-based
requirements that are currently in
place with regards to seam failure
susceptibility, the agency could have
promulgated regulations to that effect," stated the decision released on
Aug. 14, 2017.
Underground Construction October 2017
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Underground Construction - October 2017

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