Stay denied in Kinder Morgan pipeline case

Published 12:51 pm Saturday, February 24, 2018

The Federal Energy Regulatory Commission has denied a request for a stay in a case concerning a natural gas pipeline that runs through Boyle County.

FERC, the federal agency charged with regulating all natural gas pipelines in the country, ruled last year that energy company Kinder Morgan could stop using Tennessee Gas Pipeline No. 1 for natural gas, in effect giving the go-ahead for a plan to use the pipeline for “natural gas liquids” (NGLs), a collection of byproducts from fracking in the northeast. A trio of environmental groups filed a motion for rehearing in the case and asked for a stay of FERC’s order. The stay would have prevented Kinder Morgan from pursuing its plan until FERC decides whether to rehear the case. But FERC denied the stay in an order filed Tuesday, finding that “justice does not require a stay and therefore (FERC) denies the motion for stay.” However, the order specifically notes that FERC has not ruled yet on whether it will rehear the case.

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“In order to support a stay, the (environmental groups) must substantiate that irreparable injury is ‘likely’ to occur. The injury must be both certain and great and it must be actual and not theoretical,” the order reads. “Bare allegations of what is likely to occur do not suffice.”

The three groups are Allegheny Defense Project, a group based in Pennsylvania; and two Kentucky-based organizations — Kentucky Resources Council and Kentucky Heartwood. In court documents, they are often referred to simply as “Allegheny.”

“Allegheny makes little effort to substantiate a claim of irreparable injury” in its motion for a stay, the FERC order argues. “Allegheny states that they have ‘members who live, work and recreate along the proposed pipeline route’ and who have ‘been active in community meetings and protests against the pipeline.’ But Allegheny has failed to provide specific information regarding the purported injury inflicted upon their members by the Tennessee Abandonment and Capacity Restoration Project.”

FERC’s denial quotes Allegheny’s original filing, which argued that the pipeline project would involve “direct surface and subsurface impacts, and will alter the landscape.”

“These generalized claims of environmental harm do not constitute sufficient evidence of irreparable harm that would justify a stay,” the order reads. “In support of its claim of irreparable harm, Allegheny also points to the ‘distinct possibility of leakage and of catastrophic failure’ of the pipeline after it is converted from gas vapor to gas liquids service. But the September 2017 order does not authorize any subsequent use of the pipeline. As we explained, the (FERC’s) ‘jurisdiction over the subject pipeline ends once it is abandoned in accordance with the conditions’ specified in the order.”

That argument — that approving abandonment of the line for natural gas purposes can be considered separately from the environmental impacts of using the pipeline for NGLs — is what Allegheny took issue with in its initial filing.

Allegheny filed its “request for rehearing and motion for stay of order” with FERC on Oct. 30. The document lays out Allegheny’s arguments that FERC misinterpreted the law and took the pipeline industry’s side over residents’ in its Sept. 29 order allowing “abandonment” of Tennessee Gas Pipeline No. 1.

“(FERC) improperly segmented and limited its review of the impacts of the conversion … thus dodging a complete, rigorous environmental study of the total project impacts,” the Allegheny filing argued. “… (FERC’s) efforts to facilitate (Kinder Morgan’s) repurposing of this natural gas line while limiting its scope of environmental review  is precisely why Justice Douglas cautioned that federal agencies ‘are notoriously under the control of the powerful interests who manipulate them through advisory committees, or friendly working relations, or who have that natural affinity with the agency which in time develops between the regulator and the regulated. Just as Justice Douglas used the example of the former Interstate Commerce Commission being overly sympathetic ‘to take the business and railroad view of things,’ so too is the Federal Energy Regulatory Commission overly sympathetic ‘to take the business and (natural gas) view of things.'”

FERC’s denial of the stay doesn’t buy into Allegheny’s argument.

“Where, as here, a party seeking a stay is unable to establish that it will suffer irreparable harm absent a stay, the commission need not examine other factors,” FERC stated in the denial.

Opponents of the pipeline plan argue that NGLs are more explosive, more toxic and much heavier than natural gas; that Pipeline No. 1 was not built to handle the added load or flow in the opposite direction; and that a leak or explosion could be devastating to local environments and economies along the path of the pipeline.

Tennessee Gas, the subsidiary of Kinder Morgan that currently owns the pipeline, filed an answer in the case in December, arguing against the motion for stay and restating arguments that FERC should ignore the NGL aspects of the case.

“Much of intervenors’ alleged harm comes from the potential use of the abandoned line to transport natural gas liquids. But as the Certificate Order correctly recognized, (FERC) has no jurisdiction to regulate this activity and could not appropriately place conditions on the operation of a natural gas liquids line even if it wished to do so,” Tennessee Gas argued.

Tennessee Gas’ answer alleged a stay would cause it “substantial” financial damage.

“Tennessee first applied for this project in February 2015. The Certificate order was not issued until two and a half years later in 2017,” the answer reads. “Any further delay can only have an adverse effect on Tennessee and nothing in the Motion for Stay demonstrates otherwise. The truth is that this project has been thoroughly vetted and further delays are unwarranted.”

Despite having approval from FERC, Tennessee Gas has not yet moved forward with the pipeline plan, citing “uncertainty in market conditions” in filings with FERC.

Opponents expect local zoning ordinances along the pipeline’s 964-mile route, including one in Boyle County that requires a conditional use permit for transporting hazardous liquids, to be a potential final hurdle should the plan move forward in the future.