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PennEast may be next Northeast pipeline project subject to delays

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PennEast may be next Northeast pipeline project subject to delays

Anothernortheast natural gas pipeline project may get held up in regulatory processes,after the Delaware River Basin Commission told FERC it would conduct separate hearingson a proposed 1 Bcf/d line running through its territory.

The DRBC,in no hurry to review the proposed PennEast natural gas pipeline project, said thehearings are not expected to take place until after 2016.

In anApril 25 letter to FERC, the DRBC said it was withdrawing a request for a jointpublic hearing and public meeting with the federal commission. The DRBC manageswater resources in the Delaware River region and is made up of members representingDelaware, New Jersey, Pennsylvania, New York and the federal government throughthe U.S. Army Corps of Engineers.

"TheDRBC is committed to a process that affords individuals the opportunity to commenton issues of concern to them that relate to the basin's water resources," theregional commission said in a statement. "Because of the high level of interestin the PennEast project, the DRBC expects to conduct multiple public hearings inPennsylvania and New Jersey, the states where the project is proposed to be located.DRBC does not currently anticipate holding hearings during calendar year 2016."

One ofthe DRBC's members, New York, on April 22 refusedto issue a water quality certificate to a Constitution Pipeline Co. LLC project,which had already been approved by FERC. Constitution has vowed to fight New York'sdecision, accusing the state of delaying the project for political reasons ratherthan environmental ones.

PennEastspokeswoman Patricia Kornick said the PennEast developers were taking the DRBC decisionin stride. She said the DRBC review will provide another opportunity for stakeholdersto provide feedback and called this "an important step in the project's development."The regional commission is reviewing a PennEast application for a temporary surfacewater withdrawal and discharge permit.

"Itis not unusual that the DRBC ultimately decided to conduct a public review independentfrom FERC, and PennEast is pleased to participate in it," she said in an email.

"PennEastis continuing through the comprehensive FERC review process and anticipates thePennEast Pipeline being operational in the second half of 2018," Kornick said."Upon its completion, energy consumers throughout the region will receive numerouspractical, environmental and economic benefits for years to come."

The DRBChas already proved itself to be no friend of natural gas development. Thecommission has been sitting on new regulations for shale gas development since November2011 when revised rules permitting drilling and fracking were met with a huge publicoutcry. The commission tabled the rules to gather more data, effectively banningunconventional drilling in Pennsylvania counties bordering the river.

On April 4, PennEast Pipeline Co. LLC announced it had pushed back its in-service date from late2017 to the second half of 2018 after receiving a FERC update to the schedule. Theline would run about 118 miles from Northeastern Pennsylvania to customers in Pennsylvania,New Jersey and New York.

PennEast was formed by AGLResources Inc., New JerseyResources Corp.'s NJR Pipeline Co., Public Service Enterprise Group Inc.'s PSEG Power LLC, 's SJIMidstream, Spectra Energy PartnersLP and UGI Corp.'sUGI Energy Services. (CP15-558)