Mountain Valley Pipeline Seeks OK for 300-Mile Gas Pipeline
Mountain Valley Pipeline LLC has applied for federal approval to build a 301-mile interstate natural gas transmission pipeline from West Virginia to Virginia.
The company formally applied to the Federal Energy Regulatory Commission (FERC) for authorization to build the pipeline designed to provide timely, cost-effective access to the growing demand for natural gas for use by local distribution companies, industrial users and power generation facilities in the Mid-Atlantic, Southeast and Appalachian regions of the United States.
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Mountain Valley Pipeline LLC is a joint venture between EQT Midstream Partners LP, majority owner and operator of the proposed Mountain Valley Pipeline, and affiliates of NextEra Energy Inc., WGL Holdings Inc., Vega Energy Partners Ltd. and RGC Resources Inc.
The Mountain Valley Pipeline would transport Marcellus and Utica natural gas from Wetzel County, West Virginia, traversing south through 11 counties in West Virginia, then southeast through six counties in Virginia before ending in Pittsylvania County, Virginia. The project is expected to provide at least 2 billion cubic feet per day (Bcf/d) of firm transmission capacity. Pending regulatory approval, construction is anticipated to begin in late 2016, with a full in-service targeted for the fourth quarter 2018.
Through this certificate application filing, FERC is being asked to certify the public convenience and necessity of the pipeline. Together with several cooperating agencies, FERC will conduct a detailed review and evaluation of a broad number of subjects, including public safety, water resources, karst topography, air quality, wildlife, soils, vegetation, protected species, cultural and historic resources, sound levels, realistic alternatives and cumulative economic benefits.
On Oct. 31, 2014, FERC granted authorization to begin the pre-filing process for the Mountain Valley Pipeline. During the past year, the project team has conducted 16 open houses, in addition to the six scoping meetings hosted by FERC, all aimed at encouraging an open dialogue with community members, landowners and public agencies in order to receive comments and feedback on the project.
As a result of this process, the project team considered more than 1,000 miles of alternatives and variations to the proposed route and made numerous minor adjustments for individual property owners along the route to mitigate concerns that were raised during pre-filing. The proposed route identified in the application encompasses these various revisions, which include the protection of streams, wetlands and cultural resources, as well as the avoidance of or modification to several sensitive areas and karst topography regions. Examples of such adjustments include:
- Reduction in permanent right-of-way width from 75 to 50 ft.
- Avoidance of the Spring Hollow Reservoir and Camp Roanoke areas.
- Avoidance of the Elk River Wildlife Management Area.
- Alteration to the Blue Ridge Parkway crossing in order to minimize vegetation clearing and long-term visual impact.
- Avoidance of Cahas Mountain Rural Historic District and the Town of Boones Mill’s water source treatment plant.
- Avoidance of the Burnsville Lake Wildlife Management Area.
- Proposed number of compressor stations during construction reduced to three.
“Filing of the formal application is a milestone for [Mountain Valley Pipeline], and we thank the many landowners, elected officials and community members who have worked with us to design a proposed route that takes into account a multitude of individual requests and environmental considerations,” said Randy Crawford, CEO of EQT Midstream Partners. “Since the Project’s inception, we have been committed to listening, learning and continuing an open dialogue. We will preserve this same attention to detail as the Project progresses, and we will maintain our diligent focus on building a world-class pipeline.”
One of the project’s primary objectives is to serve communities along the route. The working partnership with Roanoke Gas Co., which will be a shipper, is designed to supply and potentially expand the Roanoke Gas customer base throughout southwest Virginia. Additionally, markets in the area that presently do not have natural gas service will have the ability to access the pipeline, which in turn is expected to attract manufacturing opportunities to the area.
“Our prosperity depends on the presence of robust transportation, education, recreation, healthcare, telecommunication and energy infrastructure,” said Joyce Waugh, president of the Roanoke Regional Chamber of Commerce. “With these building blocks in place, our economy and our quality of life are given great opportunities for growth.”
From an economic benefits perspective, the Mountain Valley Pipeline is expected to bring significant and meaningful benefits to West Virginia and Virginia, and the counties along its route, based on findings from FTI Consulting, the company that managed and produced the project’s economic benefits report. FTI took a conservative and reasonable approach to estimating the state-level impacts related to the pipeline based on cost data for project’s in-state spending for goods and services only, and excluding spending related to out-of-state goods and services. According to the report, the project estimates:
- Spending $811 million in West Virginia and $407 million in Virginia on labor, equipment, materials and services.
- Employment support at the peak of construction of more than 4,500 jobs in West Virginia and 4,400 jobs in Virginia, including direct, indirect and induced jobs.
- Direct employment will generate more than $335 million in labor income in West Virginia and more than $165 million in Virginia during construction.
- Increased state tax revenue is also a significant factor related to the project. For county level tax benefits, FTI discussed the process of estimating annual pipeline property (ad valorem) taxes with West Virginia and Virginia state tax officials in order to be consistent with how the states would determine the property taxes owed by Mountain Valley Pipeline. For state-level tax benefits, FTI estimated taxes based on historical state tax revenues and the sources for those revenues. The state tax analysis reflects taxes generated mainly from one-time construction and commissioning spending.
- Annual Mountain Valley Pipeline ad valorem taxes for West Virginia are estimated at almost $17 million once the pipeline is operational and more than $7 million in Virginia.
- Estimated state and local tax revenues generated during construction are more than $47 million in West Virginia and more than $34 million in Virginia (sales, use, income, property and other tax categories).
The application and resource reports, along with state and county maps are available on the Mountain Valley Pipeline website.
Tags: EQT Midstream Partners LP, joint venture, Mountain Valley Pipeline LLC, NextEra Energy Inc., RGC Resources Inc., Vega Energy Partners Ltd., WGL Holdings Inc.
