PennEast cancels natural gas pipeline project; cites lack of environmental permits from N.J.

Updated: 5:15 p.m.

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In an astounding turnaround after years of battling New Jersey over permits to build a natural gas pipeline from Northeast Pennsylvania to Mercer County, PennEast has canceled its 116-mile project.

The move comes just three months after the U.S. Supreme Court sided with PennEast over the state of New Jersey, which had attempted to block the pipeline company from seizing state-controlled land for the project. The Federal Energy Regulatory Commission, or FERC, had granted the company eminent domain to seize land from uncooperative landowners, including the state of New Jersey.

PennEast spokeswoman Pat Kornick issued a statement Monday morning, citing the continued lack of support from the Garden State in acquiring environmental permits.

“Although PennEast received a Certificate of Public Convenience and Necessity from FERC to construct the proposed pipeline and obtained some required permits, PennEast has not received certain permits, including a water quality certification and other wetlands permits under Section 401 of the Clean Water Act for the New Jersey portion of the Project; therefore, the PennEast partners, following extensive evaluation and discussion, recently determined further development of the Project no longer is supported,” the statement read. “Accordingly, PennEast has ceased all further development of the Project.”

The pipeline would have shipped Marcellus Shale gas from Luzerne County across the Delaware River to Mercer County to provide what the company said was much-needed, affordable natural gas to residents. Opponents said it would harm acres of forest, wetlands, and waterways; pose a danger from potential explosions; and represented an outmoded fossil fuel infrastructure project at a time when climate change was increasingly tied to extreme weather events.

Gov. Phil Murphy has made tackling climate change a hallmark of his administration, committing the state to meet all of its energy needs through renewable energy by 2050.

“Since taking office, we have focused on changing the ways we produce and consume energy, and have made generational investments in creating our offshore wind industry, building our solar programs, and encouraging electric vehicle investments,” said Murphy in a statement. “I welcome today’s decision by PennEast to cease development on this project and am committed to protecting our state’s natural resources and building a clean energy future that works for all New Jerseyans.”

The pipeline would have crossed dozens of waterways and wetlands, as well as the main stem of the Delaware River. The line would have also connected with Adelphia Gateway and Columbia Gas transmission pipelines in Northampton County.

New Jersey had withheld from the project the necessary permits to cross waterways. The state says it spent about $1 billion to acquire and control the parcels for open space and to preserve the land for recreation, conservation, and agriculture, and that it should not be used to ship natural gas. Acting Attorney General Andrew Bruck called the decision a “tremendous victory” for New Jersey.

“Since Day One, the Murphy Administration has fought the construction of the PennEast pipeline, which would have harmed New Jersey’s residents, businesses, and fragile natural resources,” said Bruck. “We have always said that this pipeline was dangerous and unnecessary, and our office was proud to fight PennEast all the way to the U.S. Supreme Court in an effort to block the construction.”

FERC first approved the project in 2015, drawing objections from residents, environmentalists, and the state of New Jersey. As a result of the FERC rulemaking and public comment process, the company changed the route in at least 33 instances.

Despite the June Supreme Court ruling, the project still faced additional litigation from the state, and needed Clean Water Act permits from Pennsylvania and New Jersey, as well as approvals from the Delaware River Basin Commission and the U.S Army Corps of Engineers. Pennsylvania had taken steps to grant those permits; New Jersey had denied them.

While the Supreme Court issued a major victory to PennEast, multiple legal and regulatory challenges remained. The company’s pursuit of the case in the high court, which had support from a number of industry organizations, could be seen as securing precedent and preventing other states from using similar types of challenges in the future.

“The Supreme Court’s decision, while not resulting in PennEast’s construction over state-owned recreational and conservation lands in this case, does carry precedential value for other cases,” said Jessica Bell, an attorney with the State Energy and Environmental Impact Center at NYU’s law school.

Landowners like T.C Buchanan are celebrating the victory. Buchanan owns a 32-acre organic farm in Delaware Township, Hunterdon County. She says the win is larger than her own.

“We’ve been in this tide of gobbling up people’s rights and properties and destroying everything and that tide needed to be turned and I think we’ve been a big piece of that tide turning,” she said.

Buchanan says she’s relieved it’s over and is now crying tears of joy.

Bob Rader sold his property in Milford, New Jersey rather than live with the pipeline, but says the news should be a wake up call to similar fossil fuel projects.

“The investors and companies who allowed this investment by their CEOs and boards, take note, if your company is going to invest in a project that is an environmental disaster strictly for short-term profits, I think it’s time for investors to start taking charge and changing CEOs and boards.”

A pro-pipeline group backed by building trades unions, industry, and chambers of commerce called it a “disappointing decision.”

“Pennsylvania now will lose its share of what was expected to be $1.2 billion in investments,” said spokesman Kurt Knaus in a statement. “Ending this project does nothing to change the equation. Demand for clean-burning natural gas remains high. The pipeline constraints that currently limit market access will only grow worse without projects like PennEast, which was designed to meet the clear public need by businesses and consumers for reliable, affordable energy.”

Environmentalists who had fought the pipeline quickly praised the news.

“PennEast’s cancelation of this unneeded, dangerous fracked gas pipeline is a momentous win for the communities that have fought hard for years to defend their property and the environment,” said Clean Air Council executive director Joe Minott. “Others who seek to exploit the residents and natural resources of New Jersey and Pennsylvania should take note: We are not easy-take states and we will continue to resist.”

Both the New Jersey Attorney General and Delaware Riverkeeper had also challenged FERC’s permitting of the project in the D.C. Circuit Court of Appeals, which had been in abeyance pending the Supreme Court decision.

“We knew we would get here eventually. It was just a matter of time,” said the Delaware Riverkeeper’s Maya van Rossum in a statement. “We have advocated, litigated, conducted critical scientific ground truthing, and been clear throughout that we would accept nothing short of cancellation!”

The announcement comes just days after PennEast withdrew its eminent domain claims on the 42 parcels of New Jersey conservation lands.

Disclosure: William J. Marrazzo, president & CEO of WHYY, is a member of the board of directors of UGI Corp., which is listed as a member company of PennEast Pipeline. WHYY is a partner station of StateImpact Pennsylvania.