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FERC, in signal on pipeline compliance, takes action on Rover, Midship

Highlights

Rover faces potential of $20.2 million in penalties

Midship told to address restoration issues

Washington — The Federal Energy Regulatory Commission took two steps March 18 that its new chairman said should send a "clear message" to natural gas pipeline companies that the commission will "not look the other way" when companies fail to meet responsibilities.

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The commission ordered Energy Transfer Partners and Rover Pipeline to show why they should not pay a proposed $20.2 million civil penalty in relation to allegations of misleading FERC about the destruction of an Ohio farmhouse during the application process for the 3.25 Bcf/d, 711-mile Rover project (IN19-4).

FERC also directed Cheniere Energy's Midship Pipeline to remedy outstanding restoration issues on certain tracts of land and encouraged the company to enter dispute resolution to help address remaining damage that occurred during construction, according to FERC Chairman Richard Glick. The 199.7-mile, 1.4 Bc/d pipeline project, designed to move gas to the US Gulf Coast and Southeast markets from Oklahoma 's Anadarko Basin, has faced concerns from landowners about outstanding impacts to properties following construction (CP17-458, CP19-17).

Glick called attention to both actions at the start of FERC's March 18 open meeting.

"I think it is important to remind pipeline developers that when they apply for a certificate of public convenience and necessity that they must be truthful, and that when they receive a certificate, which conditions the right to build and operate the pipeline with a requirement of the developer repairing the damage it creates during construction, that they need to take that responsibility seriously."

Warning shot

"This commission is not going to look the other way," he added. In his view, FERC has several options and "revocation of the certificate itself, must be on the table" for projects that fail to meet responsibilities.

During a press briefing with reporters, Glick underscored his view that "we need to send a clear message to certificate holders" that when they agree to a duty of candor or to act in an environmentally sound manner, "you mean that and we're not going to look the other way."

The commission voted 5-0 to issue the show cause order in relation to Rover and gave the company 30 days to respond to the enforcement staff report.

An accompanying enforcement staff report alleged that Rover made misrepresentations and omitted material information about the status and intended treatment of the farmhouse, according to a press release.

At issue is Rover's alleged 2016 demolition of the 173-year-old Stoneman House in Dennison, Ohio, a property that was eligible for listing in the National Register of Historic Places and which sat across from the site of a proposed compressor stations and within the visual area potentially affected by the project.

The Rover 3.2 Bcf/d, 711-mile project, approved by FERC in February 2017, was designed to move production gas from Ohio, Pennsylvania, West Virginia to downstream markets in the Midwest and Southeast US and as far north as eastern Canada.

The Midship project received permission to enter service in April 2020, covering 1.1 Bcf/d of project capacity. In December 2020, FERC granted a two-year extension for Midship to complete additional compressor stations, over a partial dissent from Glick, who cited concerns about landowner participation. The docket had been filed with numerous pleas from landowners for FERC to step in to help address damages during construction or ensure completion of restoration, with some worried FERC would be handing off leverage by agreeing to the extension.

In an email, Cheniere spokeswoman Jenna Palfrey said, "It is our goal to find resolution with all landowners, to be a good neighbor and operator."

She added that Midship last week "voluntarily initiated alternative dispute resolution through FERC, which seeks to achieve a mutually satisfactory solution with the aid of a neutral third-party."

"Midship's goal is to continue the safe, secure and reliable delivery of natural gas through its pipeline and continue following the state, local and federal rules and regulations by which the pipeline is regulated," she said.