Several large interstate pipeline projects that would carry natural gas from the mineral rich counties of Ohio, Pennsylvania and West Virginia are winding their way through the federal regulatory process, with some possibly beginning construction as early as 2016.
In total, the seven separately planned projects, being built by four separate groups of companies, would include more than $16.4 billion of investment and the construction of more than 1,900 miles of 24- to 42-inch diameter pipeline that would cut through parts of West Virginia, Ohio, Virginia, Pennsylvania, Michigan and North Carolina.
Officials with the oil and gas industry believe the pipelines are the relief valve needed to help them recover from a precipitous decline in natural gas prices this year, which was caused by a glut in production nationally. By creating a large network of pipelines that can export gas to markets in the Midwest, the Mid Atlantic and the Gulf Coast, industry officials hope they can inflate market prices in the region and, in turn, increase investment for new drilling projects.
“The key is getting to unserved and underserved areas,” said Corky DeMarco, executive director of the West Virginia Oil and Natural Gas Association. “Once those projects are all built, it will allow us to produce at the rates we were a couple years ago.”
The large influx of pipelines now up for federal review highlights the industry’s delayed attempt to catch infrastructure development up with gas production, which has skyrocketed in the past five to seven years due to unconventional drilling in shale formations like the Marcellus and Utica. By combining horizontal drilling and hydraulic fracturing, commonly referred to as fracking, gas developers have been able to tap deposits that were previously unattainable, increasing U.S. gas production by 44 percent in less than 10 years.
Viewed on a map, the multi-billion dollar pipeline projects spread out like a web from the northwestern corner of West Virginia, bisecting counties like Marshall, Doddridge, Pocahontas and Putnam. Two of the projects, the Rover and Leach Xpress pipelines, run West into Ohio. The Mountain Valley and Atlantic Coast / Supply Header projects would run southeast into Virginia. The WB Xpress project would retrofit parts of an existing line to carry more gas east into Virginia. And the Mountaineer Express pipeline would start in Marshall County and run down the western side of the state into Cabell County.
While these seven pipeline projects are being eagerly pursued by companies like Dominion, EQT Midstream, Energy Transfer and Columbia Pipeline Group, the projects are running into resistance from landowners, environmental groups and some local, state and federal officials.
Thousands of public comments have been submitted online for several of the projects, all of which have filed preliminary or final plans with the Federal Energy Regulatory Committee, the federal body responsible for oversight of interstate pipeline projects.
Several of those commenters, including officials with the U.S. Forest Service and the Southern Environmental Law Center, have questioned whether all of the pipelines, several of which run through national forests in eastern West Virginia, are needed.
Those groups have asked federal regulators to conduct a regional environmental impact assessment for several of the projects, including the Atlantic Coast, WB Xpress and Mountain Valley pipelines, arguing the need for such projects should not be considered individually, especially since they cross what the forest service referred to as the “the wildland core of the central Appalachians.”
“When multiple proposals are pending for the same region, separate environmental review for each project presents the serious risk that a federal agency will overlook important alternatives that could avoid or minimize impacts for the region as a whole,” lawyers for the Southern Environmental Law Center wrote.
Combined, the seven projects — not all of which run through Forest Service land — would be capable of transporting around 12.25 billion cubic feet of gas per day from the Marcellus Shale region. According to data from the West Virginia Department of Environmental Protection, that volume is more than four times the amount produced by the entire state of West Virginia on average in 2014. In December 2014 — the most recent data available — West Virginia produced 3.5 billion cubic feet of gas per day on average from both horizontal and conventional wells.
Regionally, the pipelines would be able to handle around 64 percent of the gas expected to be produced from the entire Marcellus and Utica shale plays in Ohio, Pennsylvania and West Virginia in October, according to data from the U.S. Energy Information Administration. The Marcellus region runs northeast through Pennsylvania along the entire length of that state’s northern boarder and into New York.
Coupled with the interstate pipelines that already exist, the environmental groups argue federal regulators need to ensure the rush to build new pipelines doesn’t lead to unnecessary development now or in the future.
“Decisions made now about how and where to locate pipelines will resonate for decades, but there is no plan to guide this build-out,” lawyers with the Southern Environmental Law Center wrote.
Industry officials say the proposed projects aren’t just about creating enough pipeline capacity to handle current production levels. They are meant to provide enough room for future production from the Marcellus and Utica, which they hope will jump once prices rebound and foreign exports of liquefied natural gas increase.
“The more outlets you’ve got, the more wells that are completed and put into the system,” DeMarco said.
Several of the projects have also struggled to gain access to personal property in order to conduct surveying and environmental assessments needed to complete their federal applications, raising conflicts and legal battles over eminent domain.
In August, Monroe County Judge Robert Irons ordered that EQT, the company planning to build the Mountain Valley Pipeline that would run from Wetzel County south into Virginia, could not use eminent domain to force landowners to give the company access to their private property.
“The pipeline cannot be considered for public use on the basis of its use for gas shippers. Gas shippers do not constitute the general public of West Virginia,” Judge Irons wrote in his order. “Moreover, nearly all of the gas in the pipeline will belong to affiliates of [Mountain Valley Pipeline], making the danger great that the defendant’s project is solely for private use and private gain.”
DeMarco said he would expect that order to be appealed.
Politically, the pipelines have drawn contrasts between some politicians in West Virginia and surrounding states. Tim Kaine, Virginia’s former governor turned U.S. senator, has championed the call for a more thorough review of several of the pipeline projects that would run through his state.
While Kaine didn’t take a position on the pipelines, arguing those technical decisions were “best addressed by FERC, not by members of Congress,” he asked federal regulators to provide as much information as possible to impacted landowners and to weigh the benefits of the projects against their “cumulative impacts.”
Kaine asked federal regulators to pressure the companies into reviewing how many regional pipelines were actually needed to meet demand and to unveil how much of the gas travelling through those pipelines would be exported out of the United States.
“I believe [liquefied natural gas] export can make sense on a strategic, case-by-case basis to reduce the world’s dependence on hostile energy states like Iran and Russia,” Kaine wrote. “But whatever views one has on this issue, the people in this area of Virginia bear the potential risks of this infrastructure and deserve to know where the gas is going.”
In contrast, several West Virginia’s U.S. congressional delegation, including Rep. David McKinley, Rep. Alex Mooney and then Rep. Shelley Moore Capito, have touted the pipelines as economic saviors for West Virginia and called for their “favorable and timely consideration.”
“We are in the midst of another industrial revolution, as the potent combination of the world’s best workforce here in the United States, combined with abundant, affordable domestic supplies of energy creates an unbeatable value proposition for manufacturers to return production to the United States,” Rep. David McKinley wrote in November of last year, before gas prices and West Virginia’s economy dramatically declined. “It is important that West Virginia have the modern infrastructure that we need to garner our share of these returning jobs.”
Reach Andrew Brown at firstname.lastname@example.org, 304-348-4814, or follow @Andy_Ed_Brown on Twitter.