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Update: Rover brings in FERC-picked contractor amid construction delays

As delays mount for Rover Pipeline LLC's $4.1 billion natural gas pipeline project, the developer agreed to bring in an outside contractor selected by a federal regulator, a move that could eventually help get the project back on track.

Rover, the Federal Energy Regulatory Commission and an independent contractor filed a memorandum of understanding May 31 that moved the project a shade closer to restarting a needed type of drilling. The contractor was brought in as a result of leaks from horizontal directional drilling were discovered at the project’s construction sites in April. FERC staff recently ordered Rover not to begin new drilling activities until after the findings of the contractor and a recommended plan for future drilling activities could be reviewed.

The contractor, J.D. Hair & Associates, was selected by FERC staff and is based in Tulsa, Okla. The company was chosen after an independent review and offers consulting services related to drilling design, analysis, site investigation and construction monitoring. Rover, an Energy Transfer Partners LP subsidiary, will have no control or direction over the contractor's work other than processing invoices, and will be able to review its findings only when they become publicly available, under the Energy Policy Act of 1992.

FERC approved the 511-mile pipeline Feb. 2, and the project would deliver approximately 3.25 Bcf/d from Appalachia to Midwest markets. The first phase of the line is now expected to place into service by the end of July, about one month after the original in-service date.

While the project "is in full construction along the majority of the project route," so far only 21%, or 117.85 miles, of pipe had been installed as of May 19, according to the latest construction and environmental status report filed by Rover. The lateral lines that will be part of phase one of the project vary in the amount of pipe laid, with the Seneca Lateral at 74.8%, the Clarington Lateral at 50.5% and the Cadiz Lateral at 0%.

At the time the spills were detected, Rover was using the same method of drilling at sites. "Rover will continue drilling at the ... locations that are currently underway excluding Captina Creek and Middle Island Creek unless otherwise notified by FERC that other drills may commence," the report said.

The first phase of the project includes the laterals and mainlines A and B running to a new market interconnection, the Midwest Hub, in Defiance County, Ohio.

Pressures outside FERC and construction issues are also mounting, as the Sierra Club, FreshWater Accountability Project and Michigan Residents Against the Rover Pipeline asked the U.S. Army Corps of Engineers to move against the project. The groups asked FERC to revoke Rover's certificate order, claiming the project was misrepresented by project sponsors, resulting in a "potentially more dangerous pipeline route" in Michigan. The groups asked the Army Corps to "immediately shut down all construction activity" for the project.

The groups pointed to the spills from drill sites as evidence that the pipeline's impacts exceeded the expected minimal effects on the environment.

"Given the serious environmental damage this project has already done, it is clear that Rover and its contractors do not have the necessary understanding of the geology along the pipeline route to avoid adverse environmental impacts," Terry Lodge, an attorney for the groups, said in a June 1 news release. (FERC docket CP15-93)