Millennium Pipeline has received certificate approval from the USFederal Energy Regulatory Commission for the Eastern System Upgrade project,which would add 223 MMcf/d of capacity on the eastern end of its system in NewYork.
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The project will increase capacity along the constrained portion ofMillennium's system, specifically from the Corning Compressor station inSteuben County to the interconnect with Algonquin Gas Transmission at Ramapoin Rockland County.
By alleviating this constraint, production within the area will have thepotential to increase and deliver more gas into Algonquin, according to PlattsAnalytics' Bentek Energy. The increase in deliveries will in turn placedownward pressure on AGT city-gate prices.
The project entails a roughly 7.8-mile-long, 30- to 36-inch-diameter loopin Orange County known as the Huguenot Loop, two new 24,000 hp compressorstations in Sullivan and Delaware counties and other modifications to existingMillennium stations.
Millennium has precedent agreements with nine shippers, all of which arelocal distribution companies or municipalities, for about 91% of the capacityand is marketing the remaining 20,500 Dt/d, according to FERC's certificateorder (CP16-486), issued late Tuesday.
Unlike Millennium's Valley Lateral project, which has been caught up in alegal tangle between FERC and the New York State Department of EnvironmentalQuality over a water quality certificate, the Eastern System Upgrade hasalready received air and water quality approval from the state agency.
Construction of the Valley Lateral, which would serve a new power plant,was held up when the 2nd US Court of Appeals on November 2 granted anadministrative stay of the notice to proceed with construction, at the requestof the DEC.
In granting approval for the Eastern System Upgrade, FERC foundMillennium had taken sufficient steps to minimize harm to landowners andcommunities. For instance, it noted 88% of the Huguenot Loop would be withinexisting rights of way.
It rejected arguments presented by the Delaware Riverkeeper Network --including through a report by Accufacts -- that the 36-diameter portion of theHuguenot Loop was larger than needed for the project. FERC's staff's review ofpipeline hydraulic flow models found that "Millennium properly designed itsfacilities to provide an additional 223,000 Dt/d of new firm transportationservice to meet the requirements of its expansion shippers while operatingunder winter and summer design conditions and meeting all other contractualobligations and minimum delivery pressures."
FERC also countered arguments from Delaware Riverkeeper that thecommission had improperly segmented its National Environmental Policy Actreview by not considering the project alongside the Valley Lateral.
"In this case, the projects will not result in a single pipeline or onethat is linearly, physically or functionally interdependent," the commissionsaid.
While taking note of multiple comments opposing the project, FERC saidthat its environmental assessment found the upgrade will have no significantimpacts.
The certificate order also addressed at length arguments about the scopeof FERC's analysis of greenhouse gas emissions, an area of active litigationchallenging pipeline projects.
While maintaining that upstream greenhouse gas emissions are not mandatedas part of FERC's NEPA review, the commission nonetheless provided upper boundestimates for upstream GHG emissions of 180,000 mt/year CO2 equivalentfrom extraction, 350,000 mt/year CO2 equivalent from processing and57,000 mt/year CO2 equivalent from the upstream non-project pipelines.
Citing a prior federal appeals court ruling that found one of itsenvironmental reports to be inadequate, FERC also pointed out that, in thiscase, its final environmental assessment estimated that if all 223,000 Dt/d ofgas were transported to combustion end uses, downstream emissionswould reach about 4.3 million mt/year of CO2.
Opponents to the project, including Delaware Riverkeeper, were alreadypromising legal challenges.
Millennium spokeswoman Michelle Hook Wednesday welcomed the certificateand said the company is working on an implementation plan to beginconstruction.
"FERC did a thorough job on the order and fully addressed objectionsraised by opponents," she said.
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