Constitution Pipeline to fight denial of key permit by state of New York

Constitution Pipeline Co. LLC announced April 25 that it remains committed to pursuing the federally-approved capacity addition project, despite the recent decision by the New York State Department of Environmental Conservation (NYSDEC) to deny the Section 401 Water Quality Certification for the Constitution Pipeline Project.

“In spite of NYSDEC’s unprecedented decision, we remain absolutely committed to building this important energy infrastructure project, which will create an important connection between consumers and reliable supplies of clean, affordable natural gas. We believe NYSDEC’s stated rationale for the denial includes flagrant misstatements and inaccurate allegations, and appears to be driven more by New York State politics than by environmental science,” the project sponsors said in a joint statement.

Constitution Pipeline said it worked closely with NYSDEC staff for more than three years to ensure that water quality measures are met before, during and after construction. Constitution Pipeline voluntarily agreed to the agency’s requests to incorporate re-routes, adopt trenchless construction methodologies, commit to site-specific trout stream restoration and agreed to fund approximately $18 million for wetland mitigation and banking and approximately $8.6 million for the restoration and preservation of migratory bird habitats.

“We worked in good faith with the NYSDEC for years, so this decision comes as a surprise and is contrary to our dialogue and collaborative effort to address concerns,” the project backers said. “The FERC-certificated route was developed after extensive environmental and engineering analysis, which included a comprehensive review of route alternatives. In its Final Environmental Impact Statement, the FERC concluded that environmental impacts associated with these alternatives were significantly greater than the preferred route. Despite this, in the spirit of collaboration we followed NYSDEC guidance and further altered our preferred route to adopt NYSDEC staff recommendations.

“We were informed by the NYSDEC that the agency had everything it needed to process the water quality certification. This point was further emphasized when the agency issued a notice on Dec. 24, 2014, indicating that the application was indeed administratively complete.

“Contrary to NYSDEC statements, the company was not informed of any outstanding issues that it had not agreed to address as a condition of the permit. In fact, during the past nine months, weekly inquiries were made to the department to ensure no additional data was needed. Those inquiries were either ignored or responded to in the negative. It is obvious that the NYSDEC deliberately chose to remain silent to bolster the political campaign of the State.”

The company took serious issue with claims that its application lacked information related to stream crossings, depth of pipe, or blasting.

The project sponsors continued: “Completely contrary to NYSDEC’s assertion, we provided detailed drawings and profiles for every stream crossing in New York, including showing depth of pipe. In fact, all stream crossings were fully vetted with the NYSDEC throughout the review process. We are appalled with the comments that Constitution failed to provide sufficient data to ensure every crossing was totally in compliance with the NYSDEC guidelines.”

The project sponsors will pursue all available options to challenge the legality and appropriateness of New York’s decision particularly since it is based primarily on: comments previously made by New York to FERC which FERC considered before issuing its Certificate of Public Convenience and Necessity for the project; and factually inaccurate assumptions and assertions.

Denial of the 401 Water Quality Certification by NYSDEC further delays the potential for Constitution Pipeline to help facilitate local natural gas service to homes and businesses in Southern New York, including the installation of delivery taps along Constitution’s proposed route to facilitate local natural gas service by Leatherstocking Gas Co. LLC to homes and businesses in southern New York and northern Pennsylvania.

The permit denial will also delay about 2,400 direct and indirect jobs that would be created during pipeline construction, generating $130 million in labor income for the region. The decision could also cost local governments approximately $13 million in annual property tax revenue.

The 2015 New York State Energy Plan specifically recognized the role of the Constitution Pipeline, projecting that natural gas usage will increase during the next 15 years, and by 2030, natural gas will provide the largest share of any single fuel source. Much of this additional natural gas will be used to help generate electricity while also enabling the state’s adoption of more renewable energy sources.

Constitution Pipeline Co. is owned by subsidiaries of Williams Partners LP (NYSE: WPZ), Cabot Oil & Gas Corp. (NYSE: COG), Piedmont Natural Gas Co. Inc. (NYSE: PNY), and WGL Holdings Inc. (NYSE: WGL). The 125-mile pipeline project is proposed to connect domestic natural gas production in northeastern Pennsylvania with northeastern markets during the second half of 2017.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.