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Court backs FERC on Millennium project, finds New York review exceeds a year

A court Monday let stand a US Federal Energy Regulatory Commissiondecision that booted New York out of the permitting process for aMillennium Pipeline natural gas lateral to a CPV Valley power plant inNew York, affirming rulings that allowed the gas project to move past adelay at the state level and into the construction phase.

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A decision Monday by the US 2nd Circuit Court of Appeals denied apetition by the New York State Department of Environmental Conservationthat had asked the court to vacate two FERC orders that allowed Millenniumto start building the 127,200 Dt/d Valley Lateral project.

The court agreed with FERC that the state agency had waived itsauthority to review Millennium's request for a Clean Water Act Section401 certificate by failing to act on the company's application within oneyear.

"The plain language of Section 401 outlines a bright-line rule regardingthe beginning of review: the timeline for a state's action regarding arequest for certification 'shall not exceed one year' after 'receipt ofsuch request,'" the court said. "It does not specify that this time limitapplies only for 'complete' applications. If the statute required'complete' applications, states could blur this brightline rule into asubjective standard, dictating that applications are 'complete' only whenstate agencies decide that they have all the information they need."

The court also confirmed that FERC had jurisdiction over the gastransportation project.

"Millennium is pleased with the court's precedent-setting decision thataffirms FERC's interpretation of the Clean Water Act, which will allow usto continue with construction," Millennium spokeswoman Michelle Hooksaid, noting that the FERC certificate carried environmental mitigationmeasures.

Millennium completed a critical section of the eight-mile lateral at theend of December and plans to finish the project this summer. The $57million lateral will bring gas to CPV Valley's approximately $900million, 720-MW CPV Valley Energy Center in Orange County, New York.

The case had bounced around before it came to the 2nd Circuit. FERCapproved the project in November 2016. Frustrated with a state delay inissuing a decision on the water permit, Millennium asked the DC CircuitCourt of Appeals to compel the state DEC to issue the permit, but thecourt said the company would have to seek a remedy at FERC.

On August 30, 2017, two years after Millennium had first applied for thewater permit, the state denied the company's application. In September2017, FERC found that the state agency had waived its authority due tothe delay. After the state agency and landowners who opposed the projectmade an unsuccessful attempt to obtain rehearing from FERC, they askedthe 2nd Circuit to review both the FERC waiver order and the orderrejecting rehearing. -- Sean Sullivan, newsdesk@spglobal.com

-- Edited by Christopher Newkumet, newsdesk@spglobal.com