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Over the past month, hundreds of Wayne County, Stark County, and Medina County landowners received a package from the Federal Energy Regulatory Commission (or "FERC") informing them that they may be in the path of another large interstate pipeline project known as the NEXUS Gas Transmission system.
The NEXUS Gas Transmission system (or the, "NEXUS Pipeline" for short) is a proposed pipeline system sponsored by NEXUS Gas Transmission, LLC (or "NEXUS", a joint venture between Spectra Energy DTE Energy, and Enbridge, Inc.). The NEXUS Pipeline, as proposed, would transport up to 1.5 billion cubic feet per day of natural gas through approximately 255.9 miles of newly installed pipeline starting from access points in eastern Ohio to potential interconnects with Ohio markets and with an existing pipeline grid in southeastern Michigan. Once connected into the Michigan grid, the transported natural gas then could be directed to markets in the United States or Canada.
To many Stark and Wayne County residents already familiar with the Rover and Utopia Pipeline projects, this pipeline project probably sounds like more of the same. What makes the NEXUS Pipeline project unique, however, is that these recent notices from NEXUS and FERC were not issued at an early stage of the FERC approval process, but only after the approval process for this project was already well underway.
The original proposal for the NEXUS Pipeline project had a very limited effect on Wayne County landowners since the proposed route only crossed the very northeastern corner of Wayne County. During the very early stages of the project approval process, specifically on March 23, 2015, the City of Green, in Summit County, Ohio, filed an objection to the NEXUS Pipeline project.
In its objection, the City of Green proposed an alternative route (the "City of Green Alternative") which would replace nearly 96.8 miles of the proposed route with an alternative 102.9 mile route that would avoid Summit County entirely by routing the majority of the first two-fifths of the pipeline system through Stark and Wayne Counties. While FERC has not endorsed or approved the City of Green Alternative, it has asked NEXUS to evaluate the City of Green Alternative and provide FERC with a site-specific plan showing the location and effects of this proposed route.
A pipeline re-route of this size and scope, particularly in the later stages of the regulatory process, is somewhat unusual. Landowners in the proposed alternative route were only informed of this development after FERC issued its Draft Environmental Impact Study on the NEXUS Pipeline project. As a result, landowners who would normally have years to file written objections to the proposed pipeline route now have until August 29, 2016. Even more unusual, if the City of Green Alternative is approved by FERC, affected landowners could only have a few months in which to negotiate a settlement with NEXUS prior to being condemned if an extension is not granted.
As with any potential pipeline agreement, landowners should retain experienced pipeline lawyers to assist in navigating through the legal thicket associated with this pipeline. Landowners should be particularly wary of fee arrangements based on a percentage of the "increase" in compensation over an initial offer as NEXUS negotiations on the original portions of the route have already displayed the dramatic increase in compensation NEXUS is willing to provide. Considering the severely restricted timeframes involved, landowners impacted by the City of Green Alternative route are strongly encouraged to begin evaluating their options, including retaining legal counsel, well in advance of receiving a final confirmation that they will be in the final NEXUS Pipeline route.
David J. Wigham is a second-generation oil and gas attorney at the firm of Roetzel & Andress, with more than 25 years of experience in the industry. He maintains offices in Akron and Wooster, Ohio, and can be reached at 330-762-7969.