Breaking News: Rover Pipeline Approved But Major Questions Remain

On the eve of a pending quorum issue that may have delayed issuance by an additional several months, late last night the Federal Energy Regulatory Commission (FERC) issued its unanimous approval of a Certificate of Public Convenience and Necessity to Energy Transfer Partners' Rover Pipeline. In the Order, the FERC also denied Rover's request for a blanket certificate, which impacts Rover's ability to perform certain routine construction activities and operations, some without Commission approval, following project completion. A denial of this sort is highly unusual, but it will not likely impact the start of tree clearing activities.

The FERC approval is welcome news for Rover, but the Certificate, issued with numerous stringent environmental conditions, may be too little, too late as the March 31 tree clearing window deadline quickly closes. In the 119-page Order, FERC granted the Certificate subject to 45 stringent environmental conditions that include numerous sub-conditions. Prior to beginning tree clearing and other pre-construction activities, Rover must obtain approval from FERC, likely in a partial notice to proceed. Historically, the time between filing of the implementation plan and the actual start of tree clearing activities can take at least several weeks, which would leave Rover with less than one month to clear nearly three thousand acres before the close of the March 31 window.

Under Rover's original plan, which involved Rover starting tree clearing over one month ago in order to meet the deadline, Rover planned for the fastest clearing rate (acres per day) on record for mechanized clearing. To make matters worse, Rover has not yet obtained the requisite permits necessary to begin mechanized tree clearing activities in all states. As such, in the interim, tree clearing activities in Ohio and West Virginia must be conducted by hand at dramatically reduced rates on an acreage per day basis. There is some, albeit very limited, precedent for projects in which the U.S. Fish and Wildlife Service has granted a several week extension following the close of the clearing window. But those projects involved circumstances in which the developer could complete all required tree clearing, and given the acreage necessary to clear, Rover may not be in that position.

As is commonly the case with FERC Certificate Orders, Rover must obtain "all applicable authorizations required under federal law (or evidence of waiver thereof)" in order to begin construction of project facilities, which by our count includes at least six remaining permits, most notably Clean Water Act, Section 401 water quality permits in Ohio and West Virginia. Therefore, regardless of the pace of tree clearing, Rover cannot begin "project facility" (mainline) construction until these permits are obtained. In addition to these requirements, Rover must also, among other things:

• File its final Migratory Bird Conservation Plan that includes documentation of its consultation with the U.S. Fish and Wildlife Service regarding avoidance, minimization, and mitigation measures.
• File its Indiana Bat Conservation Plan and receive written notification from the FERC Staff that construction and use of mitigation may begin.
• Obtain FERC staff conclusion that its resolution of adverse effects as they relate to the Stoneman House are in compliance with section 106 of the National Historic Preservation Act.
• Settle numerous pending landowner easement agreement issues.