N.J. and Pa. utilities propose $1 billion gas pipeline

A group of New Jersey and Pennsylvania utilities moved forward Thursday with a controversial $1 billion project to tap into Marcellus Shale natural gas production, saying the new pipeline would deliver low gas prices, stable electricity rates, and a manufacturing renaissance to the region.

PennEast Pipeline Co. filed an application with the Federal Energy Regulatory Commission (FERC) for a certificate of public convenience and necessity, which would authorize PennEast to build the 118-mile pipeline from Luzerne County to the Trenton area.

The PennEast Pipeline, one of several major infrastructure projects in the works to deliver energy from newly developed Appalachian shale fields, already has become a battleground of competing visions for America's energy future between advocates of low-cost domestic gas production and fossil-fuel opponents.

"This safe, state-of-the-art infrastructure project will not only help meet the region's energy demands; it can power New Jersey and Pennsylvania's economies for years to come," said Peter Terranova, chairman of PennEast's board of managers.

Environmental groups vowed to oppose FERC's authorization, which would allow the pipeline to claim easements by eminent domain, if necessary.

"This pipeline is not needed in New Jersey, and our land, water, and communities should not be sacrificed for this ill-conceived pipeline," said Tom Gilbert, campaign director of the New Jersey Conservation Foundation.

The organizers of the pipeline, which would be built and operated by a subsidiary of UGI Corp. of Valley Forge, say construction would begin in early 2017. In addition to FERC approval, the project requires review by the Delaware River Basin Commission, the States of New Jersey and Pennsylvania, and the U.S. Army Corps of Engineers.

Of the pipeline's one billion cubic feet a day of capacity, 72 percent is committed to local gas utilities, Terranova said. Power-plant operators and gas producers have locked up the rest.

In addition to UGI, whose Pennsylvania gas utilities would tie into the pipeline, PennEast's partners include affiliates of most of New Jersey's gas utilities: Public Service Electric & Gas Co., South Jersey Gas, Elizabethtown Gas, and New Jersey Gas.

Spectra Energy, which operates the Texas Eastern Transmission pipeline, also has joined the project with the aim of increasing capacity to customers in Southwest Philadelphia and suburban counties.

Pipeline opponents, including Delaware Riverkeeper Network and the Sierra Club, have encouraged landowners to turn away PennEast's surveyors to slow the process.

Pat Kornick, PennEast's spokeswoman, said many of the route modifications incorporated in the 11 months since PennEast began a "pre-filing" process of public meetings and preliminary FERC submissions were done at the behest of landowners. PennEast has scouted the route using aerial surveys and other mapping tools.

PennEast's supporters say they recognize the pipeline is a hardship for some affected landowners but tout the broader economic benefits.

"Yes, it's inconvenient for somebody to have a stretch of pipeline go through their yard or their neighborhood park," said David N. Taylor, president of the Pennsylvania Manufacturers Association, "but the benefit which will be enjoyed by all communities all across the commonwealth depends upon having that infrastructure deployed."

More information, including a detailed map, is on the company's website: www.penneastpipeline.com.

amaykuth@phillynews.com

215-854-2947 @maykuth