Mountain Valley Gas Pipeline Starts Operation

Equitrans Midstream Corp. has put onstream a 303-mile pipeline from West Virginia to southern Virginia offering two billion cubic feet of daily natural gas transport capacity, after delays from environmental and land rights lawsuits.

The Mountain Valley Pipeline (MVP), which began construction 2018, has recently been made available for “interruptible or short-term firm transportation service until long-term firm capacity obligations commence on July 1, 2024”, the Canonsburg, Pennsylvania-based company said in a statement.

The 42-inch underground interstate conduit targets gas produced in the Marcellus and Utica shale plays, which sit in the United States’ top gas producing region of Appalachia. Equitrans said it hopes to capitalize on growing power demand in the mid-Atlantic and the Southeast regions through the pipeline.

“Demand for natural gas in Southwest Virginia continues to grow, and the importance of MVP’s energy supply cannot be overstated”, Paul Nester, president and chief executive of utility Roanoke Gas Co., commented. “The MVP and its natural gas supply are essential to meeting the needs of residents and businesses across the Roanoke Valley, now and for many years to come. Further, MVP’s delivery points to Roanoke Gas in Franklin and Montgomery Counties are certain to provide direct, long-term economic benefits to our community and this region”.

Transportation agreements for 550 million cubic feet per day of capacity are expected to commence under 20-year terms with the startup of the MVP.

Equitrans said, “The MVP is now part of a critical network of more than 300,000 miles of interstate and intrastate natural gas transmission pipelines transporting the natural gas that fuels modern America and the U.S. economy”.

The project has faced legal battles over safety and environmental concerns and right of way disputes, which caused delays and inflated costs.

Equitrans insisted on announcing the start of operation, “In accordance with all permit requirements, the MVP was built under unprecedented regulatory oversight and followed stringent construction, safety, and environmental protocols, including the protection of threatened and endangered species, and cultural, historical, and environmental resources”.

On June 11, the Federal Energy Regulatory Commission gave the green light for the MVP to begin operation. “We find that Mountain Valley has adequately stabilized the areas disturbed by construction and that restoration and stabilization of the construction work area is proceeding satisfactorily”, FERC Director for Energy Projects Terry Turpin said in the authorization letter.

Republican Senator Shelley Moore Capito, who helped lead efforts in Congress to expedite permitting for the project, said in a statement, “After receiving all the necessary permits and approvals from both Republican and Democrat administrations, overcoming needless delays by courts and climate activists, this critical project is in now in service and can begin to deliver needed energy to markets up and down the Atlantic coast”.

Environmental campaigners reacted by warning that risks from the project remain. “The project is far from final restoration when hillsides continue to slip, people lack clean well water, agricultural lands are damaged and streams are clogged with sediment”, said Autumn Crowe, interim executive director of the West Virginia Rivers Coalition. “These problems will persist long after gas is pumping through it”.

Oakland, California-based Sierra Club said, “It has long been clear that the pipeline is unable to comply with basic environmental protections, with hundreds of water quality related violations throughout the course of construction”.

“Regulators have also yet to complete analysis of a failed component of the pipeline”, Sierra Club said. 

The pipeline is a joint venture by Equitrans as the operator, AltaGas Ltd., Consolidated Edison Inc., NextEra Energy Inc. and RGC Resources Inc. 

The MVP will be taken over by EQT Corp. if its acquisition of the operator is completed. The merger, which has an initial enterprise value of $35 billion, would create “America's first large-scale, integrated natural gas producer with an unrivaled low-cost structure that provides investors with the best risk-adjusted exposure to natural gas prices”, EQT said March 11.

The merger parties expect to close the transaction in the fourth quarter.

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