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Another Major Natural Gas Pipeline Project Bites The Dust

Another Major Natural Gas Pipeline Project Bites The Dust

A key natural gas pipeline that would have connected shale gas from Pennsylvania to the northeast U.S. was blocked on April 22 by New York regulators. The incident reveals the growing difficulty that fossil fuel companies are having in the United States, as opposition to energy infrastructure spreads.

The Constitution Pipeline, backed by Williams Partners and Cabot Oil & Gas, was not a major pipeline in terms of distance – it would only stretch 124 miles. But it would link up the vast Marcellus Shale to the huge demand centers in Boston and the rest of New England. Williams Partners says the pipeline would create 1,300 jobs or so, and would provide cheap natural gas to the northeast.

But environmental groups and local landowners are not convinced. They fear the negative side effects on land and water. Trees have to be clear cut to make way for the route. Food & Water Watch, an environmental group, said that the pipeline would cross 277 known bodies of water and a leak would devastate drinking water resources. Related: The Merger That Could Create a New Oil Major

New York Governor Andrew Cuomo clearly heard them. The Constitution Pipeline was supposed to have been completed in 2015, but suffered years of delay as it struggled to obtain necessary regulatory approvals. On April 22 his administration denied key permits to the pipeline project, arguing that the pipeline does not meet the state’s water standards. The pipeline would have crossed several New York counties before it could connect with a larger transmission system near Albany.

(Click to enlarge)

“Governor Andrew Cuomo sent a clear message by rejecting the Constitution Pipeline: New Yorkers’ health and safety will not be sacrificed for fossil fuel industry profits. With this decision, he protected the people of New York and took an important step toward embracing a true renewable energy future,” environmental group Food and Water Watch said in a statement.

The industry sees something more pernicious. They argue that politics are affecting the regulatory process, which is bogging down infrastructure across the country. Just as with the Keystone XL Pipeline, which became a huge battle between the oil and gas industry on the one hand, and environmental groups on the other. The rhetoric and the ferocity of that fight exceeded the importance of the project, and it came to symbolize a broader clash of priorities. Ultimately, environmental groups prevailed after President Obama rejected the pipeline on climate grounds. Related: OPEC’s No. 2 Under Serious Threat From Political Instability

But environmental groups are parlaying that success, taking the fight to more and more pieces of energy infrastructure. The so-called “Keystone-ization” of the fossil fuel world is starting to seriously worry oil executives. More and more pipelines are succumbing to protest.

“What we are seeing, unfortunately…is that every gas pipeline project out there is being treated in the same way that Keystone was,” Martin Durbin, Executive Vice President, American Petroleum Institute, said at an event held in Washington DC by The Atlantic Council in late April.

Environmental groups oppose pipelines, citing safety and pollution concerns, but Durbin dismissed those arguments. “None of those things are true. But I do have to say, it is going to take a concerted effort, not only inside of industry but all of those who are going to be benefitting from this” to explain the benefits of natural gas, Durbin said.

The rejection of permits for the Constitution Pipeline came only a few weeks after Kinder Morgan saw its Palmetto Pipeline in coastal Georgia blocked by a judge. The pipeline would have carried 167,000 barrels per day of refined products to Georgia and Florida, but is now stalled. Also, Kinder Morgan scrapped its Northeast Energy Direct pipeline, a gas pipeline across Massachusetts, because of low natural gas prices and regulatory hurdles. In Oregon, federal regulators rejected a pipeline project that would have fed a proposed LNG export terminal on the Pacific Coast, in part because of the costs that it would have imposed on landowners. Related: Low Oil Prices? Texas Is Doing Just Fine

The term “Keystone-ization” was inadvertently coined by API’s Martin Durbin. Environmental groups don’t have a problem with the term, and are taking up the phrase and its implied strategy. “Every coal mine, every frack well, every oil export terminal ... all of them are being met with strict, strict resistance,” said environmental activist Bill McKibben, founder of 350.org, at a protest in April in front of the White House. “There’s people arrested every day now around the country taking on these infrastructure projects, the kind of spread of civil disobedience like we’ve never seen.”

Keystone XL stole all of the attention for several years, but since its rejection in late 2015, environmental activists have killed off several more gas pipelines, many of which have not made national headlines. Future projects will likely meet the same fierce resistance.

By Nick Cunningham of Oilprice.com

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Leave a comment
  • CL on May 04 2016 said:
    I would appreciate learning more about the environmental groups. They never have a specific name or any further information in news articles. It would be interesting to know how they are funded or by whom.

    I get that people are concerned about formation leaks contaminating ground water, but gas pipeline leaks are generally detected and the environmental impact tends to be minimal.
  • afishe on May 04 2016 said:
    How quickly some forget the recent leak in CA. Google Aliso Canyon and then tell everyone who had to be evacuated how the leaks are generally detected and the enviromental impact tends to be minimized.
  • Kevin L on May 04 2016 said:
    Just occurred to me recently; if oil companies want pipelines built, they need to stop loading rail cars. In effect, anyone or any place that doesn't want your product, time to cut them off.

    Or you can just keep following all the rules designed to kill your industry. Your choice.
  • Steve E on May 04 2016 said:
    Aliso Canyon isn't a gas pipeline it's a well and storage facility...so apples and oranges. And I know all about evacuations. I lived in Mississauga, Ontario Canada in 1979. It was home of the largest peace time evacuation in history. Over 200,000 people were evacuated due to a train derailment. The biggest risk was chlorine gas. I was 19. I was out of my home for 3 days. An inconvenience, but we lived through it and things were a lot different in 1979. Today, every house in Mississauga--now a city of 750,000; then a city of 295,000--is serviced by natural gas. So despite these "disasters" people are still flocking to live there.

    Natural gas is an inexpensive source of energy. It has to come from somewhere. Guess how they transport petroleum products (including natural gas LNG) where pipelines don't exist...you guessed it...by train. Why do you think hypocrites like Warren Buffet, who owns railroads, fight pipelines? I live within a kilometre of a pipeline. It's been there for over 30 years.
  • No Guff on May 04 2016 said:
    CL, if you wish to get the low down on the biggest, best financed and most 'successful' environmental groups, google 'Vivian Krause' who has done yeoman work on unmasking their financial and political connections.
  • marc fenton on May 05 2016 said:
    In Europe funding of these groups comes from the EU,George Soros, Saudi Arabia and Qutar .The same for Canada and The US.
  • kennymac on May 05 2016 said:
    High prices electricity generated by "alternatives" cost people their jobs and hurt our most vulnerable citizens the most. They are truly a crime against humanity.
  • Rick B on May 16 2016 said:
    Only one or 2 bad winters with oil prices going higher and and electric prices going to .25 cents a kilowatt will cause a middle class silent majority to advise the bone heads running our government. Perhaps Trump could infuse a little common sense into our government.
  • Bill Simpson on May 28 2016 said:
    Trump wins with a Republican Congress, and Keystone XL, along with every other one, will be built. They will change the laws, making them all, 'National Energy Emergencies' or something.
    I don't think he will win, but it will be close.
  • mike on May 28 2016 said:
    Sure....see how much Warren Buffet contributed to his campaign. Profits before safety every time. Just like Obama with Keystone. We need more disasters by rail like Lac Megantic. This has nothing to do with safety or health. It will now be shipped by rail which is much more expensive an dangerous but it keeps Buffet's margins up there.

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