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Full service on Rover would lift gas storage, Energy Transfer tells FERC

Placing into service additional segments of the completed Rover natural gas pipeline would unlock 850 MMcf/d of incremental capacity and gas supply, helping to refill U.S. gas storage, Energy Transfer Partners LP's Rover Pipeline LLC told the Federal Energy Regulatory Commission.

The comments in a May 30 supplemental filing with FERC reflected the operator's sense of urgency to meet contractual schedules.

Whether Energy Transfer will get what it wants — approval by the morning of May 31 to start up two laterals, a supply connector line and a section of mainline — is uncertain. Amid several spills and other environmental problems during construction, the commission has said its decision on remaining in-service requests will depend on whether it is satisfied with Rover's commitment to complete environmental restoration. In its latest filing, Energy Transfer sought to head off any concerns FERC might have, while also focusing on market needs.

"Given the substantial progress Rover has made toward restoration, and the commitment Rover has made to complete the restoration work, Rover respectfully submits that it is not in the public interest to prevent gas from flowing," Rover said. "This incremental supply would likely be used to offset the large deficit the nation is facing to replenish storage inventories in preparation for the 2018-2019 heating season."

FERC spokesman Tamara Young-Allen said commission staff were evaluating Rover's request. "They continue to monitor Rover's restoration efforts and won't make determinations until they feel those restoration efforts are satisfactory," Young-Allen said.

FERC stressed that point in a March letter to Rover, in which the agency said remaining in-service requests would depend on FERC's confidence that future restoration will get the proper attention.

Rover laterals have had erosion control problems, in some cases involving land slips and landslides requiring substantial remediation.

While the company has sought to assure the commission it was pouring resources into repairs and restoration, compliance monitors and inspectors have documented problems along the way. The most recent FERC environmental reports tally 635 noncompliance instances for the project.

On May 10, a FERC official said restoration had "not satisfied" the terms of Rover's permit at that point, but added that staff expected Rover to take steps toward meeting expectations with improved weather conditions.

For the Burgettstown lateral, which straddles Pennsylvania and Ohio, Rover's latest filing said 34.3% of final cleanup and restoration would be complete by June 1, when some shipper contracts are set to take effect. For the Majorsville lateral, which straddles Ohio and West Virginia, Rover said 18.7% of the final cleanup and restoration would be complete by then.

The operator stressed that it was "fully committed to completing all restoration work" on the timelines it promised.

"However, with construction of pipeline and related facilities now complete, gas on the remaining facilities can begin to flow immediately," Rover said in the filing.

Gas storage levels have been depressed

In its latest inventory report, the U.S. Energy Information Administration reported that natural gas in storage stood at 1.629 Tcf for the week ended May 18, which was 804 Bcf less, or 33% less, than the year-ago level of 2.433 Tcf. It was 499 Bcf less, or 23.4% less, than the five-year average of 2.128 Tcf. Gas stocks have shown signs of building, albeit slowly, in recent weeks. The EIA is set to update the inventory figures on May 31.

Rover played up the current storage levels in its push on FERC to act quickly on its latest in-service request.

"Record-setting cold weather during the 2017-2018 winter heating season resulted in dangerously low storage inventory levels as the nation entered the injection season," the company said. "Approval of the requested Rover segments would contribute significantly to reducing that storage deficient in advance of the upcoming winter. Being properly prepared in time for the upcoming winter will help maintain reliability and address price volatility, which will benefit consumers in the entire region."

Rover eager to bring the rest online

Rover began initial service on Sept. 1, 2017, bringing about 700 MMcf/d of its certificated capacity online on a limited path. Since then, Rover has placed additional supply laterals and compressors into service, raising capacity to current levels of around 2 Bcf/d.

Use of the pipeline's full 3.25 Bcf/d of capacity will likely hinge on upstream supply laterals entering service as well as downstream deliveries to Vector Pipeline. The second phase of the project, which includes the market zone north segment, is designed to allow stranded Northeast shale gas to reach Midwest markets, access to the Vector Pipeline LP system, and travel to the Dawn Hub in Ontario. (FERC docket CP15-93)