trending Market Intelligence /marketintelligence/en/news-insights/trending/ZckhBxHBan1zSt-4X52B6w2 content esgSubNav
In This List

FERC clears 400 MMcf/d Permian project, sets 2 more pipes for action

Podcast

Next in Tech | Episode 49: Carbon reduction in cloud

Blog

Using ESG Analysis to Support a Sustainable Future

Research

US utility commissioners: Who they are and how they impact regulation

Blog

Q&A: Datacenters: Energy Hogs or Sustainability Helpers?


FERC clears 400 MMcf/d Permian project, sets 2 more pipes for action

The Federal Energy Regulatory Commission acted on one of the backlogged natural gas projects in its dockets, the 400 MMcf/d Sendero Carlsbad Gateway LLC and put two other pipelines on its agenda for authorization decisions at the commission's Oct. 17 open meeting.

The Oct. 10 actions continue to show that FERC is able to move on natural gas projects with a strengthened 2-1 Republican majority, although three LNG projects pitched for Brownsville, Texas, and closely watched by the LNG sector, were noticeably left off the agenda for next week.

The 23-mile Sendero pipeline project would provide takeaway capacity for a recently completed processing plant, owned by a Sendero affiliate, in the Permian Basin, providing transportation capacity to the Waha Hub. Sendero had been reminding FERC to act on the application, arguing that every day of continued delay increased the hardship on producers.

Democratic Commissioner Richard Glick dissented, as he has mostly done on natural gas projects, saying the commission is again assuming away the climate implications of constructing and operating the project. (FERC docket CP18-538)

Permian optionality

On tap for Oct. 17, FERC decisions are Natural Gas Pipeline Co. of America LLC's 17-mile, 500 MMcf/d Lockridge Extension Pipeline, another Permian Basin area expansion that will provide southbound transportation to the Waha Hub (CP19-52). The project will provide shippers the optionality to move gas southbound targeting Mexican export demand.

Also on the agenda for a vote is Williams Cos. Inc.'s Transcontinental Gas Pipe Line Co. LLC 7.7-mile Southeastern Trail project, intended to add 296 MMcf/d of gas delivery capacity to mid-Atlantic and Southeastern states in time for the 2020-21 winter heating season (CP18-186). Williams in June had asked for action by June 14 so that it could complete work for a November 2020 start. It had previously sought a May 1 decision.

FERC earlier this year appeared stuck on multiple natural gas project decisions amid a 2-2 split over climate change considerations. The departure of Democrat Cheryl LaFleur tipped the balance in favor of the Republican majority, although there have been questions about whether recusals might stymie some decisions.

LNG projects pending

FERC has gotten some nudges to act on LNG projects in the Brownsville Ship Channel area that received their final environmental documents more than five months ago. In September, Annova LNG pressed FERC for a prompt decision, noting that its potential customers and investors routinely point to delays at FERC as bearing on their financial decisions. Texas LNG LLC also recently put in a request.

While FERC's environmental reviews of each of the three projects pitched in that area found acceptable impacts if mitigation and various plans were followed, the FERC staff reports found significant cumulative impacts of all three projects, for instance, on two wildcat species.

Meanwhile, the U.S. Fish and Wildlife Service recently issued its biological opinion for the third Brownsville area project, NextDecade Corp.'s Rio Grande LNG project, as well as the related 135-mile Rio Bravo pipeline project. It found that the proposed project would not likely jeopardize the continued existence of the ocelot or the Gulf Coast jaguarondi, the two wildcat species in question.

It did not, however, consider the cumulative impacts of the other two LNG projects, saying those would be the subject of separate federal Endangered Species Act consultations.

Despite developers pushing for prompt action, FERC is being strongly urged not to do so by groups opposing the LNG projects.

Save RGV and Lower Rio Grande Valley Sierra Club Group on Oct. 8 gave FERC a series of reasons why FERC should deny or put off action on the 6.95 million tonne/year Annova LNG project.

The groups argued that FERC should redo the socioeconomic impact assessment to take into account the Oct. 1 approval of a property tax abatement for the project in Cameron County, Texas, and asserted the environmental review was incomplete and that action should wait until the deepening of the Brownsville Ship Channel is a "done deal" to allow for Annova's operations.

Unlike most LNG projects approved by FERC this year, the three Brownsville projects have faced robust opposition from a coalition of environmental groups, fishers and a community organization.

Maya Weber is a reporter with S&P Global Platts. S&P Global Market Intelligence and S&P Global Platts are owned by S&P Global Inc.