U.S. takes more time to decide on New York denial for Constitution natural gas pipeline

(Reuters) - U.S. federal energy regulators gave themselves more time to decide whether to rehear their earlier order upholding New York’s denial of a water permit for Williams Cos Inc’s Constitution natural gas pipeline from Pennsylvania to New York.

The Federal Energy Regulatory Commission (FERC) on Wednesday rejected Constitution’s request to overturn New York’s denial of a water quality certification in January.

If FERC did not act, Williams rehearing request would have been deemed denied within 30 days from the date the request was made, which was Feb. 12.

Williams argued New York waived its authority under the Clean Water Act to decide on the water quality certification for Constitution by failing to act within a reasonable period of time.

That argument is similar to Millennium Pipeline’s case against New York before FERC, which the federal regulator decided in the pipeline’s favor.

Williams filed with FERC to build Constitution in 2013. FERC first approved construction of the project in 2014 and then again in 2016, conditional upon other approvals.

Williams filed for water quality certification with the New York Department of Environmental Conservation (DEC) in August 2013. The company withdrew and resubmitted that application twice, first in May 2014 and then again in April 2015, both times at the DEC’s request.

In April 2016, the DEC denied Williams application, saying the company failed to provide sufficient information to determine whether the project would comply with the state’s water quality standards.

Williams appealed that New York denial to a federal appeals court, but the court in August 2017 concluded it lacked jurisdiction and upheld the state’s decision. The company petitioned the U.S. Supreme Court in January to review the appeal court’s ruling.

If built, the 125-mile (201-km) pipeline would transport 0.65 billion cubic feet per day of shale gas. New York uses on average about 3.6 bcfd of gas.

One billion cubic feet of gas is enough to fuel about 5 million U.S. homes for a day.

When Williams proposed building Constitution in 2013, it estimated it would cost about $683 million and enter service in 2016. Delays, however, have boosted that estimate to as high as $875 million, according to upstate New York newspapers.

Williams said it would take about 10 to 12 months to build the pipeline after it receives the necessary approvals.

Constitution is owned by subsidiaries of Williams, Cabot Oil & Gas, Duke Energy and WGL Holdings.

Reporting by Scott DiSavino; Editing by Bernadette Baum