NY regulators deny third gas pipeline permit

The state of New York has denied a key water permit to Williams' Northeast Supply Enhancement natural gas pipeline project, echoing its denials of the same permit to two other gas pipelines in recent years.

The New York Department of Environmental Conservation (DEC) said it denied a water quality permit to the 400mn cf/d (11.3mn m³/d) project "without prejudice" because Williams' application materials had incomplete information and because an ongoing environmental review may result in changes to the project.

The US Federal Energy Regulatory Commission (FERC) last month issued a favorable draft environmental impact statement for the expansion. FERC is now soliciting comments on the statement and will host four public sessions to gather more feedback.

Williams said it plans to resubmit its water permit application. The DEC had told the company prior to denying the permit that it required additional time to complete its review, a company spokesman said.

"During much of the past year we have been working closely" with the DEC to satisfy its conditions, he said.

The same regulatory group two years ago denied a water quality permit to Williams' 628mn cf/d Constitution pipeline saying the application for that project failed to address significant water quality impacts. The agency said the 124-mile (200km) line would have affected 251 streams in the state. The denial resulted in an ongoing legal battle, with Williams in January asking the US Supreme Court to intervene in the decision.

And the DEC last year denied a water permit to National Fuel Gas' 500mn cf/d Northern Access project, saying its construction technique would block the flow of streams when digging trenches for the 97-mile pipeline.

The Northeast Supply Enhancement project would expand service on Transcontinental Gas pipeline by adding about 37 miles of new pipeline across New York, New Jersey and Pennsylvania, increasing horsepower at existing compressor stations and building a new compressor station in Somerset County, New Jersey.

It remains to be seen if the project's relatively limited footprint compared with Constitution and Northern Access will ease regulatory scrutiny from New York. The state of New Jersey has also signaled increased strictness on gas pipelines by denying a water permit earlier this year to the 1 Bcf/d PennEast pipeline.

Gas producers and pipeline companies have sought to create a mechanism to appeal state permit denials to a federal energy, and attempted to add such a fix to an infrastructure plan released by President Donald Trump earlier this year. The final version of the permit overhaul included in the plan would create a strict one-year deadline for states to decide on water permits, but would not change the appeal process.