PA Governor’s Pipeline Infrastructure Report – Hoping for the Best
A significant issue impacting the pricing and movement of shale gas in Pennsylvania is the lack of sufficient pipeline capacity to move the gas to markets, primarily those on the East Coast. It is reported that nearly 2000 unconventional wells remain shut in due to the inability to move the gas to a point of sale, and while several factors have led to a significant slowdown in drilling in Pennsylvania, midstream companies remain busy acquiring rights of way, permits and constructing new pipelines.
A major issue facing midstream companies has been the difficulty in acquiring the necessary permits from federal and state agencies for hundreds of miles of pipelines. These long linear projects require a huge amount of preplanning with a large focus on assessing potential environmental problems and impacts, and determining which route will create the least environmental disturbance, the least public concern and assure, to some degree, reasonable conditions in the permits that are needed.
Delays associated with getting permits for crossing streams, wetlands and identifying and avoiding threatened and endangered habitats and locations has had a major impact on new midstream construction. Additional concerns with impacts to agricultural and historic resources and pipeline safety have also led to concerns being raised by both regulatory agencies and the public. Dealing with the numerous county and local governmental entities along the route and their differing ordinances and requirements further complicated the siting and permitting of pipelines.
While improvements had occurred over the past 12 to 18 months in addressing some of these issues, it was clear that a more comprehensive solution was needed if significant gains were to be made in permitting and constructing pipelines in the Commonwealth. This led to the announcement by the Wolf Administration in the spring of 2015 that a Pipeline Infrastructure Task Force was being formed to evaluate, address and propose recommendations for midstream development. As noted in its Mission Statement “…the PITF was tasked with developing policies, guidelines and tools to assist in pipeline development (including planning, permitting and construction) as well as long-term operation and maintenance.”
Forty eight representatives were appointed to the Task Force and included personnel from federal and state agencies, the industry, and environmental and citizen groups. Twelve workgroups were formed and populated by Task Force members and, in addition, another hundred or so representatives were asked to lend their expertise to the work groups. Meetings occurred throughout the summer and fall of 2015 and a final report is expected in January or February of 2016.
A draft of the report was released earlier this fall and while it does not contain an executive summary or a final set of Task Force recommendations, it does contain the recommendations of the individual workgroups. The twelve workgroups produced 184 recommendations for the Task Force to consider.
Initial reactions by the industry are mixed. Many feel that the Task Force’s goal of assisting in pipeline development is overshadowed by the potential huge burden associated with complying many of the recommendations included in the draft report. Industry notes that a number of the recommendations address practices already required by law or regulation or are standard best practices adopted by the industry to responsibly address environmental, safety and landowner concerns. However, other recommendations would clearly and significantly complicate and delay midstream permitting by inserting additional reviews and non-germane issues into the decision-making process. Big questions remain about how these additional recommendations would be factored into midstream projects and permit application reviews and decisions. One hope is that the final report will recognize the significant measures already used by midstream operators to responsibly comply with the laws and regulations of the Commonwealth and that the report’s recommendations will actually assist operators with pipeline development and not work against them.