Williams needs New York, New Jersey water permits for Northeast Supply natgas pipe

(Reuters) - Williams Cos Inc said on Monday it still needs water certifications from New York and New Jersey before it can start building the Northeast Supply Enhancement (NESE) natural gas pipeline from Pennsylvania to New York.

On Friday, the U.S. Federal Energy Regulatory Commission (FERC) approved construction of the 0.4-billion cubic feet per day project.

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

Williams said it could start building NESE, which is estimated to cost about $1 billion, in the autumn of 2019 after it receives regulatory approvals.

Williams said statutory deadlines to issue the water quality certifications are May 15 for the New York Department of Environmental Conservation and June 20 for the New Jersey Department of Environmental Protection.

NESE will provide additional gas supplies to National Grid Plc, the largest gas distributor in the U.S. Northeast. National Grid, which serves about 1.8 million customers in Brooklyn, Queens, Staten Island and Long Island, is converting about 8,000 of those New York City-Long Island customers per year to gas from heating oil.

National Grid has said if New York does not allow Williams to build NESE, the company may be forced to declare a moratorium on new gas customers in its New York City-Long Island service area.

In March, another New York City-area utility, Consolidated Edison Inc, imposed a moratorium on new gas customers in its Westchester County service area due to a lack of new pipeline infrastructure. Westchester is located north of New York City.

Con Edison warned in April it may be forced to impose a moratorium in its New York City territory in the future if NESE is not built since it shares some gas infrastructure with National Grid.

Con Edison said it could lift the Westchester moratorium after Kinder Morgan Inc boosts the capacity of a pipeline supplying the county, which is expected by November 2023.

Con Edison said it has been concerned about the growth of pipeline infrastructure in New York since the state rejected Williams’ Constitution project from Pennsylvania in 2016.

Williams is still fighting that denial in regulatory and legal cases.

U.S. President Donald Trump, meanwhile, issued an executive order in April designed to block states like New York from using federal law to slow construction of new pipelines.

Reporting by Scott DiSavino in New York; Editing by Matthew Lewis