Pipeline Questions and More Questions… July 11, 2014

| July 9, 2014 | 69 Comments

By Nan Shnitzler

About 90 concerned residents attended the June 26 selectmen’s meeting at the Florence Sawyer School auditorium during which representatives from Kinder Morgan answered questions about a new $4 billion high-pressure natural gas pipeline they propose to build through many towns in Massachusetts, including Bolton. The selectmen’s strategy to provide questions to Kinder Morgan in advance paid off in a smoothly-run meeting that covered a lot of ground in two hours.

The selectmen and their administrative team pared some 300 questions down to 62, divided among several main topics. Following is a summary that roughly tracks the list of questions. The session was taped for broadcast on Bolton Access Television Channel 99 and is viewable online. The list of questions plus information from Kinder Morgan is available on Bolton’s town website.

Existing Tennessee Gas Company pipeline through Bolton

Tennessee Gas Company is a subsidiary of Houston-based Kinder Morgan. Mark A. Hamarich, KM project manager, said that Bolton is currently on the Fitchburg Lateral, which has a spur to Clinton that runs through Bolton.

Since the early 1950s, local distribution companies have used the pipeline to supply gas to Clinton, Leominster, Lunenburg and Fitchburg. The Fitchburg pipe was originally 6 inches, then enlarged to 10 inches in 1977. The Clinton Lateral was originally 4 inches in 1954 and upgraded to 10 inches in 1992. The capacity of the entire Fitchburg system is 60,000 dekatherms per day. A dekatherm is 1,000 cubic feet, about enough to power an average home for four days, according to the American Gas Association, a trade group.

As for the safety of the old pipes, the gas transported does have an odor. An integrity management program helps prevent leaks via “cathodic protection,” which prevents corrosion in steel pipes; aerial surveys, where spotters can see where vegetation has died from leaks; and walking the line with detectors, which is done twice a year.

For years, herbicides have not been used to maintain the right-of-way in favor of mechanical means, but KM would not promise herbicide would never be used. The Mass. Department of Environmental Protection approves the maintenance plan.

New Worcester Lateral

Bolton is the starting point for a new spur, the Worcester Lateral, to run through Berlin, Northborough, Boylston and Shrewsbury. It came from a request by NSTAR to provide gas service in the Worcester area where there is none at present. Hamarich said that south from Bolton was a more feasible route than north from a pipeline terminus in North Grafton due to less congestion. The “sole planned use” of the pipeline is natural gas.

Pipeline details

The new pipe will be steel, 12 inches in diameter and pressurized to 750 psi, the same as the existing pipe. Selectman Chairman Larry Delaney wondered how that would work when the existing feeder pipe is 2 inches smaller than the new one. Would the existing Bolton pipe have to be expanded? Hamarich acknowledged the additional volume was a question he would have to follow up on.

The permanent easement will be 30 to 50 feet wide plus an additional 25 to 50 feet temporarily for construction, Hamarich said. The standards for pipe depth are 36 inches in normal soil, 24 inches in ledge, and 4 to 5 feet in farmland, the same as for under roadways. The standards could be modified depending on conditions, Hamarich added.

Survey issues

A hot-button issue for Bolton landowners is Tennessee Gas Company’s requests to perform surveys, including civil, environmental, wetlands and archeological. Another type of survey, geotechnical, is more invasive, but KM land specialist Jim Hartman said there are no plans for underground “horizontal directional drilling” in Bolton (though there are in four other places along the route), so geotechnical surveys are not needed.

Hartman said KM is willing to negotiate separate access agreements with landowners and would provide the survey results to them, with the caveat that the survey is “not very detailed” as it only surveys 200 feet on either side of the proposed pipeline route. Wells within 150 feet are tested before and after construction. Septic systems and associated leach fields are kept intact.

The pipeline route is not yet set, as evidenced by Sawyer Road resident Margot Brody who said she was just notified via phone that her property is no longer on the route. That’s why all the maps say “preliminary,” said Allen Fore, KM director of public relations, who said he, too, just found out about the route adjustment.

“We need to do better job as team to provide more accurate information in the towns we present in,” Fore said.

If environmental surveys reveal the presence of endangered species, the gas company would try to minimize impacts and work with the Mass. Natural Heritage program for mitigation, said Howdy McCracken, KM environmental manager. Conservation restrictions would be reviewed and abided by, Hartman added.

If landowners deny permission to survey, KM is legally allowed to petition the state Department of Public Utilities for access. The DPU would gather background information and may hold a public hearing before rendering a decision. But the company would rather work it out with landowners, Hartman said.

Once the project receives federal approval, land can be taken by eminent domain. Hamarich said that KM resorted to an eminent domain taking in 1 percent of cases in the last five years.

Pipeline approval process

Kinder Morgan needs the survey information to apply for a “certificate of public convenience and necessity,” from the Federal Energy Regulatory Commission. FERC is a five-member commission appointed by the President that regulates the interstate transmission of electricity, natural gas and oil, interstate natural gas pipelines, and other energy projects.

The Worcester Lateral filing will be part of the larger submission for Kinder Morgan’s Northeast Energy Direct Project that includes a 180-mile pipeline from Wright, N.Y. to Dracut, Mass. that will bring in inexpensive domestic natural gas from hydraulic fracturing of shale formations under Pennsylvania, New York and Ohio. Over 50 percent of New England’s electricity generation comes from natural gas.

If KM doesn’t get federal approval for the main pipeline, it would be a deal-breaker for the spurs because the entire project is being treated as one.

KM plans a FERC pre-filing in October 2014, Fore said. The pre-filing describes the need and purpose of the project and the preferred and alternate routes. Then there are public hearings, open houses, environmental “scoping” meetings and other opportunities for public comment. Once due diligence from the pre-filing is accomplished, the main FERC application is filed, anticipated in September 2015. KM expects FERC approval in November 2016 and the pipe to be operational two years later.

“We’re very, very early in the process on the proposed project,” Fore said.

Fore explained that Kinder Morgan does not own the natural gas; rather it owns the infrastructure that transports the gas from drillers to customers, such as local distribution companies like NSTAR. Before KM files with FERC, it needs to ensure it has enough long-term customer contracts for both the mainline pipe and the laterals. In other words, the local companies pay separately for the gas and its transport.

“The primary barometer for the Worcester Lateral is customer commitment [to ensure] the pipeline is fully subscribed,” Fore said.

Compensation to landowners

KM seeks easement rights to maintain the pipeline and protect it from unauthorized activities. Hartman said the company would work with landowners and their attorneys “diligently” to work out amicable easement agreements and compensation that reflect the impacts on each property. Impacts could include loss of buildable or agricultural value.

If a landowner were holding up pipeline construction after FERC approval has been obtained, KM would go to federal court. The landowner would still be owed damages for the “highest and best use” of the land, but only after construction was finished.

Hartman said in dealing with “thousands” of properties, there’s never been a problem with a home mortgage or insurance. If it comes up, KM would be willing to meet with a bank and take the responsibility for its agreement.

Non-landowners harmed by the pipeline process, for example if a truck knocked down an abutting mailbox, will be compensated as soon as KM substantiates the damage.

Hartman declined to speak specifically about a financial formula for compensation to landowners, saying appraised values provide a starting point. Brian Berube of Manor Road (an “abutter to an abutter”) was incensed that Hartman would not provide numbers when the same question had been asked at informational meetings in several other towns. Hartman responded mildly that the calculation was based on acreage, and “I don’t know the acre value on Bolton homes.”

Construction issues

Construction in Bolton would take three to five months. Hamarich described a “wagon train” process of different crews for each step: stake the right-of-way, cut and remove trees, grade and prepare the right-of-way, dig the ditch, bring in the pipe, weld and coat it, and lower it in. Road crossings are handled separately. Then the crews backfill the trench, grade it and restore the area with vegetation.

McCracken said that post-construction, KM is required to inspect the right-of-way and wetlands for up to three years and take corrective action if needed. He said FERC also inspects the right-of-way to ensure it is maintained. They endeavor to minimize invasive species.

Blasting is the most common way to remove rock and ledge. When blasting is needed, it would be “controlled” and have less impact than a jackhammer, Hamarich said. Wells within 400 feet of a blasting area would be tested before and after construction, and landowners would be fully compensated for any damage.

A lot of water is needed for hydrostatic testing, which happens before the gas is introduced to the pipe. Hamarich said they would seek a local water source, and after testing, the water would be disposed back at the source “with proper filtration” in a permitted process.

Costs and benefits to Bolton

Fore said the town would receive compensation from tax revenue on the new asset but did not agree that the pipeline would reduce individual property values.

When asked if KM would consider making additional payments-in-lieu-of-taxes to Bolton considering more town resources would be expended on the pipeline project than compensation received, Fore said the new pipeline would be assessed at a considerably higher value than the older one. He acknowledged the asset would depreciate, but did not know by how much.

According to the KM slide set, the company runs 600 miles of pipe in Mass. and paid $5.85 million in state and local taxes in 2013. The company estimates that the 180 miles of new pipeline would yield $25 million in tax payments initially.

Fore said the new “open access pipeline” would allow for the possibility of Bolton to get natural gas service, but it would be up to a local distribution company to expand its business.

He said that the company would cover any costs incurred due to a pipeline-related emergency.

As for hiring, Fore said the company hires general contractors that work with local trade unions to hire workers. He said the Tennessee Gas Pipeline office in Hopkinton offers training for pipeline workers.

Robert Cohen of Harvard Road asked why ratepayers are paying for the pipeline. Fore responded that Kinder Morgan is paying for the pipeline with a “100 percent private investment” enabled by its customer commitments and a federal tariff that allows KM to collect a pipeline “toll” from the companies that own the gas.

Rate increases come about when local distribution companies fold their costs into their rate structure, Fore said, and the “larger policy issue is about how New England wants to manage its energy supply long term.”

Gas for export?

Some residents were concerned that the gas would be heading out of New England to Canada and export abroad. Fore acknowledged the possibility, saying KM needs customer commitments of 700 million cubic feet per day to make the financial commitment to build the pipeline. However, they believe that the bulk of those would come from New England-based distributors.

According to promotional literature, although the entire project is scalable to 2.2 billion cubic feet per day, it will be designed to accommodate only the amount of capacity contracted for by customers in binding long-term agreements. Fore said the customers would be made public once the contracts were signed and FERC had approved the project.

Use of existing easements

During the meeting, there was discussion about Kinder Morgan utilizing existing infrastructural easements such as roadways and railroads, rather than blasting through conservation land. Delaney provided an apt coda:

“When you look at going the long way to Worcester, and then actually view the properties like Nancy Caisse’s farm, you’re going through some of the gems of Bolton, which, over 40 years, the town has spent thousands of hours and millions of dollars to preserve… On a federal level we realize the cards are stacked in your favor, but in Bolton we’ll resist very strongly.”

“And in Berlin!” piped up a voice from the back, to applause.

 

 

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