A court decision that stripped a wildlife permit from the 1.5-Bcf/d Atlantic Coast natural gas pipeline project will not cause a significant push to the construction schedule, an industry analyst and project developer Dominion Energy Inc. both said.
"While this is a setback, Atlantic Coast can likely still go into service close to on time," said Rob Rains, an energy policy analyst at Washington Analysis LLC. At the time the federal government approved the project, the developers expected Atlantic Coast to go into service in the second half of 2019.
Rains pointed out in a May 16 note that the initial order from the U.S. Court of Appeals for the 4th Circuit said only that the U.S. Fish and Wildlife Service permit, which allows developers to kill or otherwise affect endangered species during construction, should have had more definition on the limits of its authority. In other words, the court did not say the agency should not have issued the permit. The Fish and Wildlife Service will probably redo its analysis of the impacts to endangered species along the route, and the Federal Energy Regulatory Commission will probably halt construction to give the wildlife agency space to do this, but Rains said FERC will probably halt construction only in those areas where species have been identified as at risk.
"Handicapping this timeline is challenging, but we suspect this process will last several months," he said.
Rains said Dominion is likely to appeal the 4th Circuit order to the full court, but he does not expect the court to grant a rehearing.
The 4th Circuit on May 15 found that the Fish and Wildlife Service failed to adequately limit the authority granted by an incidental-take permit issued to the developers of the Atlantic Coast pipeline, and it vacated the permit. The pipeline is a joint venture of Dominion, Duke Energy Corp. and Southern Co.'s Southern Co. Gas. (U.S. Court of Appeals for the 4th Circuit docket 18-1082)
Like Rains, Dominion said the court ruling covers only certain sections of the 600-mile pipeline project's route. In a statement, Dominion said it would comply with any limitations linked to the court order but expects construction to continue as scheduled.
Environmental groups saw the court decision as a rebuke to the developers. "This decision is a validation of what we've been saying for years: the environmental impacts of the Atlantic Coast pipeline are huge and unacceptable," Anne Havemann, general counsel at the Chesapeake Climate Action Network, said in an emailed statement. "The only way we know we can protect our environment and our climate is to stop the pipeline from being built."
FERC approved the $6 billion to $6.5 billion project in October 2017. The project and related supply header and capacity lease projects would run through West Virginia, Virginia and North Carolina to link Appalachian shale gas to mid-Atlantic and Southeast markets. (FERC dockets CP15-554, CP15-555, CP15-556)