Derek Myers, Editor-in-chief
It’s official. A 1,230-mile Appalachia-to-Texas (ATEX Express) pipeline is being built to transport natural gas liquids (NGL) from the Marcellus-Utica Shale region of Pennsylvania, West Virginia, and Ohio to the Texas Gulf Coast near Houston (owned by Enterprise), and Fayette County is right in the middle of it all.
“It’s a 20 inch pipeline that is going to be carrying ethane, that is going to originate in Western Pennsylvania and extend ultimatley to the Texas Gulf Coast,” said Rick Rainey, an ATEX spokesman.
Roughly 70% will be utilizing pipeline that’s already in the ground and new construction will cover about 369 miles, according to Rainey.
The northern portion of the ATEX pipeline will involve the construction of a 20-inch diameter pipeline from Washington County, Pennsylvania to Seymour, Indiana where it will connect with an existing Enterprise pipeline.
That pipeline, which currently transports refined products from the Gulf Coast to the Midwest and goes through Fayette County, will be placed into ethane service and the flow direction will be reversed. At its southern terminus ATEX Express will have access to a new, 55-mile pipeline that will extend from Beaumont, Texas to the company’s NGL storage complex at Mont Belvieu, Texas.
Initial capacity for the pipeline will be 125,000 barrels per day (BPD), which could expand to 190,000 BPD.
“The first thing we do is look for a route where there is a existing pipeline corridor. In this case there is a pipeline that already exist. What we try to do, so we don’t have to create an additional corridor, is use those existing transportation corridor,” Rainey said. ”We are in the process of contacting landowners to negotiate right away agreements.”
Although they do everything they can to come to a reasonable agreement, litigation is always an option to obtain right away rights to dig.
William Goldman, a Columbus based attorney, says that anyone being confronted by ATEX, should seek a second opinion.
“Anyone that is confronted with a situation where someone is going to take a permanent position on your property, which the high pressured pipeline is, needs a second opinion. The fact of the matter is, their compensation is inadequate for a variety reason,” said Goldman.
“One of the most important reasons is that ATEX doesn’t compensate property owners for the reduction in value of your property. None of this is explained to potential landowners. The agreement is improperly written. It is written for the benefit of ATEX and there’s a number of elements in the agreement that are just absurd,” Goldman said.
According to Goldman, Enterprise legally doesn’t need the consent of the landowner prior to digging.
“Property in situations like this are eminent domain. Enterprise has the ability to take property if they want it whether or not the seller wants to sell it or not,” he said.
Enterprise, however, says they try to work with landowners as much as possible to reach an agreement.
“When it comes right down to it, our approach is we try to do everything we can to reach an agreement with the landowners. On average of 90-95%, we’re able to reach an agreement without having to take any kind of legal action,” said Rainey.
The pipeline route selection process is designed to minimize the project’s impact on the environment, as well as landowners and communities through which it will pass.
Rainey said that ATEX goes above and beyond the regulations to ensure safety.
“The requirement is for the pipeline to be buried three feet. We actually go deeper than that. We go closer to four feet minimum,” he said.
“There will some initial impact (on the enviroment) upon construction, but once operation, the land will be restored to it’s original condition. Once the pipeline is burried, there are few restrictions such as not being allowed to build a house or a swimming pool. Other than that, the land can continue to be used,” said Rainey.
Beyond this, landowners are usually permitted to use the surface of the land much as they had prior to the installation of the pipeline facilities, provided that such uses do not interfere with the safe operation of the pipeline.
Despite what some may think, signing an agreement with Enterprise for ATEX doesn’t ensure annual compensation, but rather a “one time payout.”
“First of all, it’s not annual. It’s not like an oil or gas lease. It’s a one time payment. That’s why it’s important to get the compensation set appropriately. They are offering people $5,000 to $9,000 an acre for property in the agreement; approximately $1,500 for trees that are cut down, and some money for agriculture lost,” said Goldman. ”All of those numbers we think are small. The largest thing not being compensated is the reduction in property value.”
In some cases, landowners have been given a number from Enterprise that is five times below that of an appraisal.
“We have a case in Fairfield County where Enterpirise has offered $23,000. Our appriasier believes the compensation should be $124,000,” Goldman said. ”Any problem that occurs on the property should not be the responsibility of the landowner. There are probably 25 things in the agreement that should be modified to give the property owner equality.”
Goldman ins’t opposed to the pipeline. He just wants to educate landowners on fair compensation for ATEX.
“All we’re trying to do is explain to people that compensation should better. No compensation is given to for the property that is damaged that isn’t covered under the agreement. There’s no question that there’s damage. There are so many reasons that it’s impossible to cover all of them. It’s hard for us to get to people because Enterprise (ATEX owners) will not release the property owners that’s being effected, but we’re having an open meeting at the Holiday Inn Express in Washington Court House,” said Goldman.
The meeting is on July 11 at 6 p.m. at the Holiday Inn Express hotel located at 101 Court House Parkway. Everyone in the community is encouraged to attend.
The project is expected to generate as many as 4,000 construction and full-time jobs in addition to employment resulting from increased production activity, as well as new and expanded ethylene plants in the U.S.
Locally, ATEX says they will create 700 jobs across central Ohio.
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