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Friction arises at FERC over remains of ACP, SHP gas pipeline plans

Highlights

DETI seeking extension for partially built SHP project

Environmental groups return to FERC with objections

Washington — New debate has kicked off at the US Federal Energy Regulatory Commission over whether Dominion Energy can extend the authorization of its Supply Header Pipeline project now that the related Atlantic Coast Pipeline project has been cancelled.

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The 37.5-mile, 1.5-million Dt/d SHP was originally intended to ship gas from supply areas in Ohio, Pennsylvania and West Virginia and North Carolina, with ACP as the main shipper. The project entails 30-inch-diameter pipeline segments in Pennsylvania and West Virginia, and compressor station and facility upgrades.

Change in course

Raising questions for the project, Dominion and Duke Energy July 5 announced they were cancelling the 604-mile, 1.5 Bcf/d ACP project amid continued hurdles and uncertainties related to litigation from environmental groups. Dominion also plans to sell substantially all of its gas transmission and storage assets to Berkshire Hathaway Energy in a nearly $10 billion deal, it announced the same day.

Environmentalists are now weighing in at FERC on regulation of the remains of the ACP project as well as the future of SHP. Dominion has asked FERC to extend the deadline for construction as needed for ACP by one year to complete abandonment and restoration, and to extend the deadline by two years for SHP while it considers that project's future.

Given the construction already completed on SHP and its positioning in relation to DETI's existing network, "DETI is currently evaluating options for use of some or all of the SHP," Dominion said its request at FERC. It noted that 31% of the SHP main line was installed, and significant work has also occurred at three of four existing compressor stations.

While Dominion has not specified options it is considering, in prior filings it had floated the possibility of SHP having independent utility. Even without ACP, it told FERC in August of 2018, SHP could receive incremental gas on DETI's existing system, allowing incremental supplies to move to and from Dominion South Point and bolstering injection and withdrawal capabilities for underground storage fields.

Ann Nallo, a spokeswoman for Dominion, said DETI will become a BHE subsidiary later this year but will be working on evaluating potential uses of the SHP project ahead of the final switchover.

"[A]ny future project would be conducted subject to all applicable stakeholder and permit processes," she said in an email.

Environmental groups

Southern Environmental Law Center, one of the lead litigants against the ACP project, has objected to a two-year extension for SHP, arguing a lack of evidence that FERC's needs determination and environmental analysis for the project "have not gone stale."

It noted that DETI's application for SHP explained that SHP executed a single, binding precedent agreement, with ACP.

"The commission has never, to conservation intervenors' knowledge, granted an extension request while a project applicant evaluates whether or not to actually complete or use the proposed project," SELC wrote in a July 17 filing.

The group further argued that moving ahead only with SHP would require new proceedings and a new authorization from FERC.

As for ACP, SELC sought more opportunity for public input on issues such as restoration and eminent domain before FERC grants an extension. In order to provide clarification for landowners and others, the group said any extension should limit ACP's authority under the certificate order, and public comment is needed to identify what conditions are appropriate.

Among such conditions, it sought to limit activities to those needed for restoration and abandonment, and to remove ACP's eminent domain authority over the pipeline right-of-way.

It argued FERC must allow a public comment period of at least 30 days and then require ACP to submit a restoration plan, because details were lacking, and then allow further public comment.