For-Profit Pipeline Company Claims "Public Benefit" in Seizing Private Lands in Pennsylvania

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New and protracted battles in the hydraulic fracturing (โ€œfrackingโ€) war are breaking out across Pennsylvania and other states near the Marcellus Shale over pipeline companiesโ€™ use of eminent domain.

The fiercest battle pits Philadelphia-based Sunoco Logistics against homeowners in the path of a pipeline that crosses Pennsylvania. In a controversial move invoking eminent domain, Sunoco aims to seize private lands to make room for a pipeline extension that would move highly volatile liquids (HVL) used in the making of plastics from the Marcellus Shale region to easternย Pennsylvania.

With an air of inevitability, opponents say, Sunoco is planning to move ahead with Mariner East II, a retrofit and extension of an existing east-west pipeline that was once used to ship gasoline westward from Philadelphiaโ€™sย refineries.ย 

The converted pipeline would move 70,000 barrels of highly volatile liquids, including butane, ethane, and propane, across Pennsylvania daily. Its terminus would be the Delaware-Pennsylvania border, at the companyโ€™s Marcus Hook facility, which Sunoco is also transforming to handle natural gas products, and where the company is building a plant to convert propane into propylene, a building-block commodity ofย petrochemicals.

Natural gas from the northeast has traditionally been sent to Louisiana and Texas to be processed for domestic use or shipped overseas. In moving highly volatile natural gas liquids, byproducts of natural gas production, Sunoco Logistics is aiming for a faster route to a coast. Using its Marcus Hook facility would give the company a new source of revenue and make use of the expansion of natural gas production in the Marcellusย Shale.ย 

Sunocoโ€™s primary market for these natural gas liquids is a refinery in Scotland that manufactures plastics.

Claiming โ€œPublic Benefitโ€ for Privateย Profits

The potential windfall for Sunoco may be the reason for what opponents say are strong arm tactics to seize private property in the path of the pipeline extension, tactics that include invoking eminent domain, even though itโ€™s a private, for-profit company rather than a government entity, and even though, they say, it has not proven that the pipeline would contribute a โ€œpublic benefit.โ€ Both conditions are traditionally required for landowners to forfeit property in eminent domainย disputes.ย 

Sunoco argues that their use of eminent domain is justified because Mariner East II will provide a public benefit by providing extra propane to residents in offload points throughout theย state.

Sunoco's Mariner East II pipeline crossing Pennsylvania.

Sunoco’s Mariner East II pipeline crossing Pennsylvania. Image credit: Sunocoย Logistics

And the company has won the latest battle. In July, a Pennsylvania state appeals court ruled that Sunoco was operating as a public utility and that the Mariner East II pipeline is both interstate and intrastate and was therefore subject to jurisdiction by the Federal Energy Regulatory Commission and the Pennsylvania Public Utility Commission (PUC).ย 

The majority opinion in the 5-2 decision gave Sunoco a certificate of public convenience for 17 counties along the path of Mariner East II.

Alec Bomstein, a senior litigation attorney with the Philadelphia-based Clean Air Council, which was a plaintiff challenging Sunocoโ€™s public utility status last year, scoffs at the public benefits Sunoco claims to beย providing.ย 

โ€œThe primary purpose of Mariner East II is, one, to make money for a for-profit, private corporation, and two, to export natural gas products overseas,โ€ Bomstein tells DeSmog. โ€œSaying that theyโ€™re going to help residents by providing an additional 70,000 barrels of propane a day is a red herring, because that kind of capacity is not needed in theย state.โ€

Bomstein adds that calling Sunoco Logistics a public utility is absurd because it is not regulated nor held to the standards of aย utility.

Sunoco Logistics, which is owned by Energy Transfer Partners, did not respond to DeSmogโ€™s requests forย comment.ย 

The Clean Air Council and other opponents of Mariner East II decry Sunocoโ€™s reliance on an ancient document to claim its status as a public utility, a move that wouldnโ€™t carry weight in another state. In 1930 the Pennsylvania Public Service Commission, a precursor to the state PUC, granted the Susquehanna Pipe Line Company a certificate of public convenience, allowing the company to build a pipeline to move gasoline from Philadelphia refineries to westernย counties.

Beyond crying foul over Sunocoโ€™s evoking of eminent domain, homeowners and municipalities are worried aboutย safety.

The Danger of Transporting Highly Volatile Liquids (HVL)

Highly Volatile Liquids (HVL) includingย ethane, propane, and butane are flammable gasses when released into the air. The gas is also heavier than air, which means it doesnโ€™t disperseย easily.ย 

Nevertheless, highly volatile liquids are classified as liquids by the federal government. Because of this, operators donโ€™t need to develop area-specific response plans for leaks. Thatโ€™s something that worries Eric Friedman, an officer of a homeowner association in suburban Philadelphia. Sunoco has attempted to seize open space in his development that would put a pipeline extension literally a few hundred feet from existingย homes.ย 

โ€œSunoco has a generic response plan for leaks,โ€ Friedman tells DeSmog. โ€œItโ€™s to go upwind, walk, donโ€™t drive, a half-mile or more. Thatโ€™s it. Well, how do you know thereโ€™s a leak when you canโ€™t smell the gas, and how do you know which way the wind isย blowing?โ€ย 

Friedman adds that many peopleย live within the so-called blast zone of the proposed pipeline. โ€œThis situation has left many people completely voiceless and defenseless with respect to their ability to mitigate the risk of highly volatile liquidsย infrastructure.โ€

And then thereโ€™s Sunocoโ€™s abysmal safety record. Documents at the United States Pipeline and Hazardous Materials Safety Administration (PHMSA) show that Sunoco has the worst safety record of 1,518 active pipeline operators that report operating data to PHMSA.

Friedman, who along with his homeowner board of directors are looking at ways toย fightย the companyโ€™s actions in the Delaware County court, says Sunoco offered no money for theย land.ย 

He agrees with Bomstein that the โ€œpublic goodโ€ defense used by Sunoco to seize land isย absurd.

โ€œThereโ€™s no economic benefit to this area. It will be economic blight. Ancient trees will be torn down. Our homes will be worth less because of the danger of leaks,โ€ Friedmanย said.

Pipeline Property Battles on Severalย Fronts

The controversy over whether a private company can take private land to build pipelines is notย settled.

There are many fronts to the pipeline war in several states, including upcoming court cases and possible legislativeย action.ย 

In February, the Kentucky state supreme court upheld a lower court ruling which found a pipeline company is not a public utility and therefore could not use eminent domain for natural gas liquidsย pipelines.ย 

Fifteen Ohio families are fighting Texas pipeline company Kinder Morganโ€™s use of eminent domain, claiming that seizure of land by private pipeline corporations violates the Ohio Constitutionโ€™s strict protection of private propertyย rights.

In Pennsylvania, Friedman is focusing on informing General Assembly members and those running for local and state office about the risks. He says the eminent domain issue may, as in Kentucky, be decided in the state supreme court.ย If that happens, the court will have to decide how broad the power of eminent domain is in the state, and define what constitutes publicย good.

And with oil and gas pipeline construction projects on the rise across the nation, observers on both sides will eagerly awaitย the results.
ย 

Photo credit: Anti-fracking protestors at a rally in Philadelphia, Pennsylvania, in July 2016.ย Suzanne Bobosky, used withย permission.

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