North American Oil & Gas Pipelines

OCT 2018

North American Oil & Gas Pipelines covers the news shaping the business of oil and gas pipeline construction and maintenance in North America, including pipeline installation methods, integrity management innovations and managerial strategies.

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Miller Pipelines HP napipelines.com OCTOBER 2 018 | North American Oil & Gas Pipelines 17 authorization for interstate natural gas pipelines. The Republican majority de- fended the certificates, explaining that there was a market need (as evidenced by the underlying shipper contracts) and that, as required by the National Environmental Policy Act (NEPA), FERC took a "hard look" at environmental impacts, but noted that NEPA "does not force an agency to adopt environmental- ly friendly outcomes" or "mandate that every conceivable study be performed and each problem be documented from every angle to explore its every potential for good or ill." The Democratic minor- ity objected. As a general matter, one commission- er contends that "affiliate precedent agreements cannot be sufficient in and of themselves to demonstrate that a pipeline is needed. In such cases, the Commission must review additional evidence in the record." Both Demo- crats believe FERC's NEPA analysis should document and consider climate change resulting from GHG emissions, including carbon dioxide and meth- ane, which can be released in large quantities through the production and consumption of natural gas. Now that Republicans no longer have a majority, compromise will be required, if orders are to be issued. Streamlined Review of LNG Applications On Aug. 31, FERC announced two actions involving LNG. First, FERC and PHMSA signed an MOU to coordinate the siting and safety review of FERC-ju- risdictional LNG facilities. Each agency regulates a different aspect of LNG fa- cilities: FERC determines whether the proposed facilities are in the public in- terest, while PHMSA deals with safety standards governing the location and design of LNG facilities. Pursuant to the MOU, PHMSA will review an LNG application to determine if it complies with PHMSA regulations and issue a letter to FERC with its findings. FERC, in turn, will consider PHMSA's compli- ance letter when making its public in- terest determination. Second, FERC established environ- mental schedules for 12 pending LNG terminal applications, most of which require an EIS to be issued in 2019. FERC should be able to clear up the regulatory log jam and shorten the en- vironmental processing schedules by up to a year because of a streamlining the review processes (made possible by the MOU), the addition of inde- pendent contractors to assist FERC staff, and a FERC initiative moving to electronic issuances of environmental documents for natural gas programs, including LNG. Washington Watch is a regular report on the oil and gas pipeline regulatory landscape. Steve Weiler is partner at Dorsey & Whitney LLC in Washington, D.C. Contact him at weiler.steve@dorsey.com.

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