A $520 million pipeline project thought to have the potential to support 2,500 Ohio construction jobs might be dead.
The Ohio Power Siting Board, the body that regulates major utility projects in Ohio, rejected the application for the Marcellus Lateral Pipeline more than a year ago. Kinder Morgan, a pipeline developer, owner and operator out of Houston, has made no official moves on the project since it submitted that application in November 2010.
The 16-inch pipeline was to snake 240 miles under Ohio, from the border with the West Virginia panhandle to a connection with larger pipeline just west of Toledo. It was designed to carry natural gas liquids from the Marcellus Shale formation, a layer of rock rich in oil and gas that sits underneath much of western Pennsylvania, West Virginia and the border counties of Ohio.
Its path would have crossed 15 Ohio counties, including Muskingum, Coshocton, Knox, Morrow, Marion, Crawford and Sandusky.
This past spring, the Bowling Green Sentinel-Tribune and Mount Vernon News quoted a Kinder Morgan spokesman as saying the project still was a go and to expect construction by the end of 2011. The company would first need to get approval from the siting board, which it has not sought, a board spokesman said.
When asked to comment about the project’s status, Kinder Morgan spokeswoman Emily Mir wrote: “We continue to evaluate a number of projects in the Marcellus area but do not have any definite information at this time on the lateral project other than as part of our re-evaluation we are withdrawing our application for the project.”
She declined to answer further questions.
Dale Arnold, director of energy policy for the Ohio Farm Bureau, had been conducting educational meetings with bureau members on pipeline issues in advance of the Marcellus Lateral Project.
He said the wording of Kinder Morgan’s statement suggests it is moving on to something else. Arnold said he has seen alternative energy projects (also governed by the siting board) pulled in the same manner.
“From my experience on work with wind and solar projects, when a company withdraws an application, they are looking at something entirely different,” he said.
The state is “still considering the application active, but just delayed,” said Matt Butler, spokesman for the Public Utilities Commission of Ohio, which oversees the siting board.
As of Friday, Kinder Morgan had made no filing to withdraw its application, which would close the case.
The application was deemed incomplete in 2011 because it failed to include ecological data and enough detail on an alternative route.
Butler said the commission last heard from Kinder Morgan in the fall of 2011. The company relayed it was evaluating options at that point, he said.
Local leaders in the path of the pipeline are curious about Kinder Morgan’s plans.
Jenny Vermillion, a commissioner from Sandusky County, said her office had tried contacting the company in December, but had no success.
Jim Porter and Steve Douglass, commissioners in Muskingum and Guernsey counties, respectively, say they haven’t heard anything new about the project.
“They have not talked to us for a year of maybe longer,” Douglass said.
Douglass said Kinder Morgan had almost daily contact with Guernsey’s county engineer when the Rockies Express Pipeline, a multi-billion dollar interstate pipeline that was built in Ohio in 2009, was in construction.
The pipeline plan was announced by Kinder Morgan in April 2010. At that time, the timeline called for construction to begin in July 2011 and finish one year later.
In a year-end report to investors, filed a month after its application was submitted to the power siting board, Kinder Morgan talked of the need to “continue to pursue commercial agreements with shippers.”
The company, according to an October 2010 investor presentation, was seeking commitments from producers that they would use the lateral. Combined, Kinder Morgan was waiting for a promise of at least 25 million barrels per day for 10 years before it moved forward.
Richard Kinder, chairman and CEO of the company, told analysts during a conference call earlier this month about no fewer than five projects — costing more than half a billion dollars — slated to improve the company’s liquid products transportation. No mention was made of the Marcellus Lateral.
Its biggest investment this year is likely to be the expected closing of a $38 billion deal to buy rival El Paso. El Paso operates a gas pipeline near Glouster that was the source of an explosion that destroyed three homes and a barn and damaged a second barn in November.