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Highlights

Court still mulling longer stay for water crossings

FERC recently lifted stop-work order for much of project

Washington — Soon after gaining positive news from the Federal Energy Regulatory Commission that it could resume some halted work, the Mountain Valley Pipeline project was hit with a temporary setback in the 4th US Circuit Court of Appeals. The court on Oct. 16 granted an administrative stay requested by environmental groups led by the Sierra Club in relation to the US Army Corps of Engineers' recently reissued water crossing authorizations for the project.

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This type of temporary administrative stay will be in place only long enough for the court to rule on whether to grant a more lengthy stay pending litigation over the authorizations.

The new legal challenges come as MVP recently regained some footing at FERC, which on Oct. 9 voted to partially lift its stop-work order on the 303-mile, 2 Bcf/d project.

Whether the Army Corps permits are held up longer could be crucial to the project's goal of entering service in early 2021.

Analysts with Height Securities in an Oct. 12 note said that if the court sided with MVP against the longer stay, "we believe MVP will enter service by mid-2021." But, "if the opponents successfully secure a stay, this timing could slip to 3Q21."

Gary Kruse of LawIQ said the temporary stay may mean the court was unable to rule on the merits of a permanent stay within a week. While Kruse found the arguments against a stay — that the court lacked jurisdiction at this point — to be strong, the court's reluctance to act quickly may mean it is seriously considering granting a stay for the entirety of the appeal, he said.

Natalie Cox, a spokeswoman for MVP, said that while project sponsors are disappointed with the court's action, "we respect the court's request for additional time to thoroughly consider the motion to stay and look forward to a resolution of this matter."

"With MVP's upland construction work now scheduled to begin, and as we receive additional information from the FERC regarding potentially releasing additional portions of the route for construction, MVP will continue to evaluate its current construction plans, budget, and schedule," she added.

FERC relief

The commission's Oct. 9 decision to modify the stop-work order amounted to FERC giving its blessing for the developer to resume construction in all areas outside a 25-mile buffer surrounding Jefferson National Forest, according to Height Securities. The firm expected FERC to allow work in this area in late December after the US Forest Service finishes a supplemental review of the pipeline's right-of-way through the national forest.

Commissioner Richard Glick, a Democrat, dissented from the Republican majority on both of the MVP orders and criticized what he described as the authorization of "piece-meal construction" on the pipeline when federal authorizations are outstanding.

On Oct. 9, FERC authorized MVP to cross the Roanoke River by way of a "microtunnel" and to commence work on the Greene interconnect project that is attached to the main system. FERC also granted the developer's request for a two-year extension of construction until Oct. 13, 2022, as well as an extension for the related Equitrans Expansion Project.