Clean Air Council challenges Sunoco Pipeline’s public utility status
From an Article by David Conti, Pittsburgh Tribune-Review, August 27, 2015
Sunoco Logistics has a new legal challenge against its ability to use eminent domain to secure land for a pipeline that would carry natural gas liquids from the Marcellus shale to a terminal on the Delaware border.
The Clean Air Council and the father of one its lawyers, who lives in the proposed path of the pipeline, sued the company Thursday in Common Pleas court in Philadelphia, seeking a declaration that subsidiary Sunoco Pipeline is not a public utility and therefore cannot use eminent domain to take property through court cases. The lawsuit follows a series of court challenges in several counties along the 350-mile route of Mariner East 2 in which several property owners are resisting seizure of their land.
The Philadelphia-based environmental group says Sunoco has misstated its status as a public utility, relying on older regulatory rulings from previous pipelines. “By its reasoning, Sunoco could, 100 years from now, bulldoze the house after filing a declaration of taking,” said Clean Air Council attorney Alex Bomstein, whose father, Michael Bomstein of Delaware County, is a plaintiff in the case. “That’s simply contrary to the law.”
Philadelphia-based Sunoco Logistics says a series of state regulatory rulings support a designation it received in 2002.
“We vehemently disagree with the Clean Air Council’s lawsuit and plan to stridently defend our previously confirmed status as a public utility corporation,” said spokesman Jeff Shields. “The Pennsylvania Public Utility Commission, the agency tasked with making the decision, has recently reconfirmed our status as a public utility corporation.”
The $2.5 billion pipeline would mostly run parallel to a decades-old line Sunoco reworked as Mariner East 1 to carry ethane, propane and butane from Western Pennsylvania shale wells to the Marcus Hook terminal near Philadelphia.
State and industry officials have cited such projects as necessary to getting gas and liquids from the abundant deep shale to lucrative markets.
The larger Mariner East 2 would connect to locations in Ohio and West Virginia, and Sunoco has said it would include points along the path at which liquids could be offloaded for use as fuel.
The council’s lawsuit claims the pipeline’s only purpose is to move the products across state lines to be exported. It said the interstate nature of the pipeline means it should be subject to Federal Energy Regulatory Commission jurisdiction — not the state PUC — which allows for eminent domain power for a pipeline carrying gas, but not related liquids.
“Lacking any PUC order approving the Mariner 2 pipeline, or FERC order authorizing the use of eminent domain, (Sunoco) has no basis to claim that it has a right to exercise the power of eminent domain,” the lawsuit states.
In discussing the legal challenges filed in other counties, Shields this month said the project can get the necessary public utility status “from either or both” the PUC and FERC. “They are not mutually exclusive,” he said.
Mariner East 2 will cross about 2,500 property tracts, many of which contain the Mariner 1 line. According to court records and lawyers representing property owners, Sunoco has filed about two dozen eminent domain cases to gain temporary or permanent right of way for the pipeline.
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