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Wine And Gas Battle It Out In Northern US

Wine And Gas Battle It Out In Northern US

Wine and gas tend not to mix.

In upstate New York, a midstream oil and gas company is running into stiff local opposition for its plans to build natural gas infrastructure. Crestwood, a Texas-based company, has proposed plans to build natural gas storage facilities on Seneca Lake, a picturesque site in the heart of New York’s wine country.

Crestwood already owns several natural gas storage facilities in New York, storing natural gas and natural gas liquids produced from the Marcellus Shale.

Crestwood has proposed an additional site near the town of Watkin’s Glen on Seneca Lake. It would consist of millions of gallons of liquid petroleum gas (LPG), such as butane and propane, stored in old salt caverns. The company, through its subsidiary Arlington Gas Storage, also wants to expand existing natural gas storage from 1.5 to 2.0 billion cubic feet (bcf). It could potentially expand the site to handle up to 10 bcf. Crestwood’s plan is to turn Seneca Lake into a natural gas storage and transportation hub servicing the northeast.

Related: New Study Claims US Shale Gas Quantities Grossly Exaggerated

But the company is encountering strong opposition from local communities who have resorted to civil disobedience to stop construction. About 92 people have thus far been arrested for blockading Crestwood’s facility. Among them is Phil Davis, a co-owner of Damiani Wine Cellars, a vineyard on Seneca Lake. “The statement's got to be made. It's intolerable what they're proposing. It takes a lot to make me boil over, but I'm boiling over now,” Lou Damiani, the other co-owner told Wine Spectator. Several of Damiani’s employees have also been arrested.

The Finger Lakes region is home to a growing wine industry. Tourists flock to the region’s 34 vineyards, which have built a global reputation for their Rieslings.

Damiani says Crestwood is going to ruin a region that has made major strides in developing a highly respected wine industry. “It's renewable; it's sustainable; you can pass it on to future generations. We feel you cannot do both things—you cannot industrialize the area and then still have a viable wine-tourist industry.”

But local grievances go beyond the negative effects on nearby vineyards. Several community groups have been assailing the plan because it involves the storage of methane and LPG in close proximity, raising safety fears.

Indeed there have been several significant explosions involving salt cavern storage in different parts of the country before. Alarmingly, the facility that Crestwood is proposing to use has had geological problems in the past, including a collapsed roof in the salt cavern.

Moreover, local groups, such as We Are Seneca Lake, are concerned about the contamination of Seneca Lake, which provides drinking water for around 100,000 people.

Upstate New York has become increasingly industrialized as the U.S. oil and gas industry has surged. New York is now home to a parade of trains carrying crude oil from the Bakken traveling through the state, on the north side of the Finger Lakes. Dozens of oil trains pass through the state on a weekly basis, creating a virtual crude oil pipeline that runs from North Dakota to Albany.

Separately, in early December the Federal Energy Regulatory Commission (FERC) approved the construction of the Constitution Pipeline, which will take shale gas from Pennsylvania through New York. The pipeline builder is running into trouble with local landowners who are refusing to turn over their land for the project, and the company has threatened to use eminent domain.

As the shale industry has expanded, the situation has become a political hot potato for Democratic Governor Andrew Cuomo. Gov. Cuomo has been unwilling to decide on whether or not to allow hydraulic fracturing in the state, having avoided a decision for several years. He is rumored to be running for President and will face pressure from the left as he enters a Democratic primary.

However, so far he has shown a willingness to allow Crestwood to move forward with salt cavern gas storage. His Department of Environmental Conservation even deleted references in a key USGS report on the risks of gas storage, a move likely intended to assist Crestwood’s proposal.

Related: Why US Shale May Fizzle Rather Than Boom

But that has only enraged towns near Seneca Lake. Feeling as if state and federal regulators have let them down – FERC approved Crestwood’s storage facility in September – citizen groups are increasingly turning to protest. The number of people who have been arrested continues to climb.

The Wall Street Journal reports that the backlash against a series of high profile pipelines across North America has spread beyond the infamous Keystone XL. At least six oil and gas pipelines totaling more than $15 billion have been delayed due to environmental opposition. As a result, costs are rising and some could ultimately be scrapped.

Nowhere is that more apparent than in the towns near Seneca Lake where opposition to Crestwood’s gas storage plan seems to be building momentum by the day.

By Nick Cunningham of Oilprice.com

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  • Joseph M Campbell on December 10 2014 said:
    For more information on this proposal, visit www.gasfreeseneca.com and thank you for writing this article. The momentum that is building against this is not confined to the citizens of the Finger Lakes Region. 13 municipalities including the City of Geneva (largest population on Seneca Lake) and the Village of Watkins Glen, County seat of Schuyler County where the project is located, have passed resolutions opposing Houston, TX based Crestwood's plans. This is the Finger Lakes, a world class tourist destination and a pristine area that we call home. Seneca Lake is the very heart of that region. Governor Andrew Cuomo can't allow Crestwood to destroy the vision that generations of family owned businesses and residents have built here. We can't pick up our vines and go somewhere else.
  • Michael Warren Thomas on December 10 2014 said:
    Thank you for reporting on the growing protests at the gates of Crestwood Energy! These geologically unstable salt caverns happen to be in the epicenter of the booming Finger Lakes wine industry.

    I wanted to correct your figure of 34 vineyards in the Finger Lakes. There are 128 wineries in the Finger Lakes, which is the most recognized wine region east of the Rockies. Wine Enthusiast magazine just named NYS the wine region of the year for 2014, over Chianti, Sonoma, and others. There are 390 wineries in NYS, with 9 licenses pending.
  • Yvonne Taylor on December 11 2014 said:
    Thank you for covering this important issue. We in the Finger Lakes region do not believe that more gas storage in unlined salt caverns next to a drinking water resource for 100,000 people is neither safe or necessary, nor is it compatible with the regional and sustainable agri-tourism economy we have spent generations building. For more information on this, please go to www.gasfreeseneca.com or www.wearesenecalake.com
  • Thomas Pellechia on December 11 2014 said:
    It's hard to imagine what can be more idiotic than allowing such a dangerous practice as this gas storage in an area that relies economically almost exclusively on tourists who enjoy its pristine beauty.

    It is equally disturbing that Governor Cuomo plays politics with people's homes and livelihoods.
  • bill moffett on December 11 2014 said:
    Seneca Lake is not fundamentally a gas mining and storage area and to convert it from a productive tourism and well-known wine producing region is counter-productive and illogical to the millions of people who live and visit the area and whose activity brings economic vitality as well as serenity. Go home gas! Leave central New York unspoiled! You are not welcome or desired here!
  • To those who oppose new pipelines on December 11 2014 said:
    Just a thought- there are thousands of miles of old oil and gas pipelines that cross lands all over the U.S. Many of those pipelines are getting to the point where they need to be replaced with new pipelines in order to avoid leaks and catastrophic spills. But those who might most be affected by these events are blocking new/safer pipelines which forces producers to transport more oil via train and truck, which are much riskier, more expensive, and more susceptible to environmental damage than pipelines.
  • John R DiBona on December 11 2014 said:
    The Finger Lakes are an interconnected array of pristine subglacial lakes that represent one of the largest surface fresh watersheds in the world. Coming soon, fresh water is the new oil . . . don't mess with it.
  • Jeremy on December 11 2014 said:
    The Finger Lakes are home to 113 wineries. 34 is the number of wineries ringing Seneca Lake itself, highlighting its importance as the most important of the lakes, and indeed perhaps the most important New York AVA, for serious wine production.

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