Page 12 - NorthAmOil Week 24

NorthAmOil COMMENTARY NorthAmOil

One compressor station
along the Atlantic Coast
pipeline still needs to be
re-permitted and built
after having its permit
overturned by a court.

compressor station for the pipeline in Buck- could increase by about 5% above the previous
ingham County, Virginia, was overturned by a estimate of $5.4bn.
court earlier this year, and RS Energy noted that
thus far, no update on a new route or any other What next?
changes had been released. While both projects still have further regula-
Dominion currently envisages restarting con- tory hurdles to clear, the legal victory has been
struction on the pipeline in July, and bringing hailed as a significant step forward. Nonetheless,
the project into service in early 2022. “These environmental opposition to major pipeline
both are feasible, but our risked view puts projects remains all but guaranteed. Comments
the project’s in-service date in mid-2023,” RS from representatives of the Sierra Club – one
Energy commented. of the organisations challenging the Atlantic
The pipeline would pass 600 feet (183 metres) Coast pipeline in court – suggest that the group
below the 2,200-mile (3,341-km) Appalachian will continue to look for ways to challenge the
Trail. project.
When complete, the Atlantic Coast pipeline In this instance, the lawsuit centred on a tech-
will carry up to 1.5bn cubic feet (42.5mn cubic nical legal question over which agency had the
metres) per day of gas from the Marcellus shale authority to allow crossings under the Appa-
to North Carolina and West Virginia over a dis- lachian Trail, but ultimately environmental
tance of 600 miles (696 km). The pipeline is one groups oppose the very existence and expansion
of several designed to serve producers in the of oil and gas infrastructure. For pipeline oper-
Appalachian Basin – by far the largest shale gas ators, this generally translates into additional
output region in the US. And indeed, the Atlan- time and costs spent on regulatory review pro-
tic Coast Supreme Court ruling eases the way cesses and legal challenges. However, in recent
forward for the Mountain Valley project and years, legal cases have started to emerge seeking
potentially other pipelines. to hold oil and gas companies accountable for
climate change.
Positive implications While the energy industry has thus far con- Atlantic Coast
EQM Midstream Partners’ Mountain Valley sidered such lawsuits to have little merit, this
pipeline from West Virginia to Virginia would is nonetheless a trend that it will be watching partners
also cross under the Appalachian Trail. The cautiously. Indeed, some energy companies Dominion and
Supreme Court decision clears the way for EQM have been lobbying for a carbon tax that would
to seek its own permit for Mountain Valley to include a liability waiver for fossil fuel products Duke have both
cross the trail, which the pipeline would do in sold in the past. If such a waiver were to become
Jefferson National Forest. law, many of these new climate change lawsuits set company
The Mountain Valley pipeline is also under a would disappear.
stop-work order because of a deficient USFWS Industry groups argue that they are meeting targets of “net
permit; however, RS Energy noted that as con- demand for necessary products – which is cur- zero” emissions
struction is nearly complete – currently reported rently hard to dispute. In the case of gas pipe-
to be at 92% – crossing the Appalachian Trail is a lines, operators also maintain that their fuel is by 2050.
more immediate concern. cleaner than coal, among others, and is therefore
EQM said in a June 11 statement that the pro- already playing a part in reducing emissions.
ject was now anticipated to enter service in early Indeed, Atlantic Coast partners Domin-
2021 – a timeline that RS Energy said it consid- ion and Duke have both set company targets
ered to be realistic. of “net zero” emissions by 2050. They argue
The operator warned, however, that past that their pipeline is a “necessary piece of the
delays to the 303-mile (488-km) pipeline in energy puzzle that will support the region’s
response to “complex judicial decisions and ongoing transition away from coal and the
regulatory changes” meant that its ultimate cost rapid expansion of renewables”.™

P12 www. NEWSBASE .com Week 24 18•June•2020