A major investor in the proposed PennEast pipeline
appears to have tempered its forecast on the completion of the $1.2 billion
project, while opponents cast doubts on whether the project can be completed at
all.
New Jersey Resources (NJR), parent company of New Jersey
Natural Gas, in July told investors in a quarterly earnings call that the
proposed pipeline would gain federal approval in 2017 and begin operating in
2018, according to an NJR presentation.
But in its Nov. 24 year-end earnings call, those
projections were removed. The company in its presentation to investors omitted
the project's final approval projection in 2017 and its operational date in
2018. Instead, the company said there would be "continuing progress'' on
the pipeline in 2016, 2017 and 2018.
Pipeline opponents were quick to say the change is
evidence that PennEast is struggling in the federal approval process.
njr_penneastjuly.jpgSlide from a July NJResources
presentation to investors, showing an federal approval date for the PennEast
pipeline and a operational date.Keith Brown | For NJ.com
"By changing the milestones for the PennEast project
in their investor presentation, NJR is sending a strong signal to the
investment community that they are facing significant regulatory delays and
strong opposition to the pipeline,", said Mike Spille, founder of West
Amwell Citizens Against the Pipeline group.
But Michael Kinney, spokesman for NJR, said the company
fully expects PennEast to be operational by 2018, and should not be read as a
change in its expectations for the project.
"This does not in any way change our confidence in
this project," Kinney said. "As with all forward-looking statements,
we caution that there are factors outside of our control that may affect the
timing of this project."
PennEast, a consortium of natural gas companies that
includes all four New Jersey gas providers, wants to build an 118-mile, 36-inch
pipeline stretching from Northeastern Pennsylvania to Hopewell Township.
The company in September filed its formal application to
the Federal Energy Regulatory Commission, which regulates pipelines that cross
state lines. PennEast has said the company expects to start construction, if
approved, in 2017.
Patricia Kornick, spokeswoman for PennEast, denied the
project has been delayed.
"The timeline has not shifted, and the PennEast
Pipeline project is progressing through the FERC application phase,'' Kornick
said. "The PennEast Pipeline project anticipates beginning construction in
2017 with the line operational in late 2017."
But Tom Gilbert, of the New Jersey Conservation
Foundation, said NJR's recent forecast perhaps reflects difficulties with the
state Department of Environmental Protection and the federal energy commission.
"It's clearly significantly delayed and it's going
to be a long, difficult road for PennEast,'' Gilbert said. "And I think
there's some question of whether they'll be able to make it at all."
The state DEP on Nov. 4 sent a 19-page letter to the
federal energy commission outlining numerous concerns the agency has about the
PennEast application, ranging from potential negative impacts on rare wildlife
along the proposed pathway to the company's construction schedule.
PennEast proposes a 7-month construction timeline,
beginning in February, 2017.
"This proposed construction schedule does not, at
this time, appear to be attainable,'' the letter said.
The energy commission followed on Nov. 24 with letter to
PennEast, giving the company 20 working days to provide a 22-page list of
changes to the application and provide additional information before the
commission could further evaluate the application.
"PennEast is clearly encountering some problems and
at a bare minimum they're behind schedule,'' Gilbert said. "I think it
raises at least some question as to whether the project could be in
jeopardy."
Municipal opposition to the PennEast proposal has been
widespread in New Jersey. Every town through which it is proposed to travel has
adopted resolutions against it, including Mercer County government, which
banned the company from surveying on public land earlier this year.
"NJ Resources less-than-rosy report to it's
shareholders echoes what communities along the pipeline have been saying all
along: PennEast is a bad bet," said Hopewell Township resident Patty
Cronheim, member of the opposition group Hopewell Township Citizens Against the
PennEast Pipeline.
Spille, who first wrote about the change in the
NJReources investor presentations on his blog, said the change represents a
significant departure from the original PennEast timeline.
"While other PennEast partners are still calling for
a 2017 in-service date, NJR is saying that it may not be online in 2017 or
2018," he said. "This difference is a really big deal."
Source: NJ.com
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