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Oil, gas groups enter Constitution Pipeline case to protect federal pipe reviews

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Oil, gas groups enter Constitution Pipeline case to protect federal pipe reviews

Theoil and gas industry, supported by manufacturing and commercial groups, hasjumped into the court case between Constitution Pipeline Co. LLC and New Yorkin an effort to protect all natural gas infrastructure projects.

Thegroups told the U.S. Court of Appeals for the 2nd Circuit that New York's Aprildenial of a CleanWater Act permit for Constitution Pipeline, which had already received FERCapproval for its 124-mile gas pipeline project between Pennsylvania and NewYork, is dangerous from a regulatory and economic perspective.

"ObtainingFERC approval for a proposed pipeline is a long, thorough, and costlyprocess," they wrote. "Denials like the decision under review arelikely to make investors wary of risking the substantial time and moneynecessary to undertake that process, only to see a single state veto theproject in the end — perhaps on the very grounds FERC already considered."

"Theresulting whiplash is particularly jarring where, as here, the state agencyactually participated fully in the FERC process," the groups said.

Theindustry and business organizations that filed the July 19 motion to supportConstitution Pipeline were the National Association of Manufacturers, theChamber of Commerce of the United States of America, the Interstate Natural GasAssociation of America, the American Gas Association, the American PetroleumInstitute, the American Chemistry Council, the Natural Gas Supply Association,the American Forest & Paper Association, and the Process Gas ConsumersGroup.

Theorganizations said state agencies should not be allowed to use the Clean WaterAct Section 401 process to "second guess" FERC approvals. The groupsreminded the court that FERC conducts an environmental review of pipelineprojects under the National Environmental Policy Act and the Natural Gas Act.

"Inshort, the many benefits of natural gas projects, which span state borders andsectors of the economy, are precisely why Congress made FERC the key decisionmaker,"the groups said.

Ahard look by the court is especially appropriate in cases such as this, thegroups said, where the New York Department of Environmental Conservationparticipated in the FERC review process and raised the same issues that it broughtup again during the Section 401 permit process.

"Congressgave individual states a limited role in the approval process and gave FERCprimary authority for reviewing pipeline projects, so that one state could notunilaterally veto FERC-approved projects and deprive others states' natural gasconsumers of a useful and valuable source of competitive natural gastransportation," Dena Wiggins, president and CEO of the Natural Gas SupplyAssociation, said in a July 20 statement.

On May 16, the Constitution Pipeline developersbrought the case tothe appeals court when they sued New York over the permit rejection.Constitution Pipeline is owned by subsidiaries of , , and WGL Holdings Inc.(U.S. Court of Appealsfor the 2nd Circuit No. 16-1568)

FERCstaff is looking intoNew York complaints that Constitution Pipeline allowed improper tree clearingand other construction activities along the project route.