The companies developing the Mountain Valley Southgate natural gas pipeline expansion from Virginia to North Carolina said on Aug. 12 they continue to target a 2021 startup for the project after North Carolina regulators denied a water permit.
The North Carolina Department of Environmental Quality (DEQ) denied the permit on Aug. 11 due to uncertainty around whether Equitrans Midstream Corp. will complete the $5.4-$5.7 billion Mountain Valley Pipeline (MVP) from West Virginia to Virginia. A unit of Equitrans is leading the MVP project.
“We are disappointed by the decision,” project spokesperson Shawn Day said, noting “Work on MVP is 92% complete and is targeted to enter service in early 2021.”
MVP is one of several U.S. pipelines delayed by regulatory and legal fights with environmental and local groups that found problems with federal permits issued by the Trump administration.
Other projects similarly held up include Dominion Energy Inc.’s recently canceled $8 billion Atlantic Coast gas pipe from West Virginia to North Carolina.
“(Southgate) has always been an unnecessary project that poses unnecessary risks to our environment and given the uncertain future of the MVP Mainline. North Carolinians should not be exposed to the risk of another incomplete pipeline project,” DEQ Secretary Michael Regan said in a statement.
“North Carolina’s clean energy future is not dependent on adding more gas infrastructure,” Regan said.
The North Carolina rejection caused some analysts to question whether Equitrans will be able to finish Southgate by the end of 2021, if ever.
Options to move crude from Canada, the world's fourth-largest producer, are useful, but A2A is "a very challenged project," said Dennis McConaghy, a former pipeline executive at TransCanada, now known as TC Energy.
Mexican President Andres Manuel Lopez Obrador said on Sept. 24 he may reverse Mexico’s 2013-2014 energy liberalization next year if he is unable to “rescue” state oil company Petroleos Mexicanos and electricity utility CFE with existing laws.
Equitrans started construction of the Mountain Valley pipeline in February 2018 designed to deliver 2 Bcf/d of natural gas from the Marcellus and Utica shale.