FERC stands by partial MVP project restart, despite opposition from chairman

New York — The Federal Energy Regulatory Commission reaffirmed its support for allowing partial construction on the Mountain Valley Pipeline to resume, over opposition from the panel's two Democrats, including Chairman Richard Glick.

But most work on the 303-mile, 2 Bcf/d project is still on hold amid a new round of permitting. The order pertains to a 17-mile area near the Jefferson National Forest in Virginia; work in waterways and wetlands along the route is paused while MVP pursues new permits.

Natalie Cox, a spokeswoman for the project, said the MVP has permits needed to continue with upland work in the 17-mile section, and "crews are mobilizing as the weather continues to improve and will conduct activities in compliance with all environmental regulations and guidelines."

Notably, Glick allowed the order to advance for a vote despite his opposition. Analysts at ClearView Energy Partners in a research note said the action confirms their view that Glick currently lacks the votes he would need to modify FERC's policies on construction in areas unaffected by permits vacated by the courts.

In the order approved 3-2, the majority rejected a request for a stay from the Sierra Club and other environmental groups, as well as the environmental groups' request for rehearing of FERC's Dec. 17, 2020 action lifting stop-work orders (CP16-10).

Majority findings

Environmental groups argued that because some of MVP's federal authorizations were invalidated in court, Environmental Condition 9 in the FERC certificate order barred a restart of construction.

The FERC majority, however, found that the environmental condition was satisfied in January 2018, when MVP indicated it had received all required federal authorizations—before the 4th US Circuit Court of Appeals vacated some permits.

"Environmental Condition 9 applies to newly certificated and unconstructed facilities; it does not apply to a scenario where applicable federal authorizations are vacated after a company has obtained necessary federal authorizations and commenced construction," they wrote.

In such scenarios, FERC said the director of its Office of Energy Projects acts to ensure all environmental resources are protected.

Democrats dissent

Glick and Clements, in their dissent, said they don't believe FERC can allow any work to continue while authorizations are outstanding.

"At this point, MVP lacks the federal authorizations required to cross over 700 waterbodies and wetlands along the project route," they wrote. "Under these circumstances, allowing piecemeal construction of a project that is still awaiting critical federal authorizations is inconsistent with any reasonable reading of the purposes behind Environmental Condition 9 in MVP's certificate."

They also questioned the assumption that outstanding authorizations would be reissued on the same terms, thus keeping the route intact.

And, in their view, FERC has not adequately explained why benefits of continuing construction outweighed rights of landowners and others who asked FERC to wait on outstanding authorizations "before allowing MVP to plow ahead with construction."

"To be sure, we all have an interest in getting the construction of a validly certificated pipeline completed without unnecessary delay. But today's order puts that interest above the interests of landowners and other affected groups in contravention of our public interest responsibilities," they wrote.

The project, designed to connect Appalachian Shale gas to Mid-Atlantic markets, received its FERC certificate in October 2017, but litigation from environmental groups and court actions invalidating permits have delayed its completion.

Faced with long-running legal hurdles to its water crossing authorizations, MVP in late January announced it would revamp its permitting approach, seeking an individual water crossing permit from the US Army Corps of Engineers and a new amendment at FERC.