By Nick Cunningham | Sun, 07 September 2014 00:00 | 0
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A new proposed pipeline would connect North Carolina to the Marcellus and Utica shale formations, bringing a massive new flow of natural gas to the southeastern United States.
The plan, from Duke Energy, calls for the construction of a 550-mile natural gas pipeline that will originate in shale gas country. It would begin in Harrison County, West Virginia and stretch southeast through Virginia. Once it crosses into North Carolina, it would travel southwest through the state. A separate extension would spur off from the route in Virginia and travel eastwards to Hampton Roads.
The pipeline would be constructed by Dominion Resources, which would maintain a 45 percent stake in the project. Duke would have 40 percent ownership, with 10 percent going to Piedmont Natural Gas Company, and the remaining 5 percent to AGL Resources Inc.
If completed, the $4.5 to $5 billion natural gas pipeline could have broad ramifications for energy in the southeast. Duke Energy is the largest electricity generator in the country, so bringing natural gas to its plants in North Carolina would mean a significant rise in natural gas consumption, and consequently, a potentially large reduction in coal generation.
Coal currently makes up about 40 percent of Duke’s generation portfolio, but the company says that by next year it will have diversified its profile to have equal portions of its generation coming from coal, natural gas and nuclear power.
The pipeline holds out the possibility that Duke – along with the broader region – will further undercut the coal industry’s market share in the electricity sector. This would merely accelerate a trend already underway. As a whole, the southeast now generates less than 40 percent of its electricity from coal, down from nearly 55 percent for much of the period between 2001 and 2012.
The change is mostly due to cheap natural gas. But coal is also getting more expensive, due to depleting Appalachian reserves and the rising cost of transportation. The construction of the pipeline would have varying effects on West Virginia, which is historically a coal state, but also a burgeoning natural gas producer. On the one hand, a pipeline could hasten the decline of coal in the state. On the other hand, the pipeline might help West Virginia build up a new industry for the post-coal era.
Politicians in West Virginia welcomed the news. “For many years, we’ve worked hard to make the most of the Marcellus and Utica Shale developments in West Virginia,” Gov. Earl Ray Tomblin said in a statement. “We continue to be optimistic about the existing and future opportunities this industry brings to the Mountain State, and today’s announcement by Dominion has the potential to create good-paying jobs for our hard-working men and women.”
The pipeline was also hailed by the governors of Virginia and North Carolina, where Governor Pat McCrory said it would mean that some parts of the state will have access to natural gas for the first time, opening up the possibility for further industrial development.
But environmentalists are not uniformly happy with the plan, because the pipeline route passes through the George Washington National Forest.
In a press release, Greg Buppert, senior attorney with the Southern Environmental Law Center (SELC), said, “It crosses prime recreational and biological areas in the national forest, including much of the best remaining wild landscape in Virginia. It is also proposed through one of Virginia’s most rugged landscapes, crossing numerous ridgelines over 3000 feet and raising serious questions about whether it can be built without significant damage to pristine forests and rivers.”
As Katie Valentine of Climate Progress noted, building a large natural gas pipeline through the George Washington National Forest could give renewed momentum for a push to allow drilling in the forest as well. That’s something Virginia Governor Terry McAuliffe has said he opposes.
SELC opposes drilling in the forest, arguing that it would threaten drinking water supplies for hundreds of thousands of people in the immediate area, as well as the millions downstream in Richmond and Washington D.C.
Residents of Nelson County, Virginia are also putting up a fierce fight to the pipeline. Property owners in the county have banded together to stop the pipeline’s route through private lands, where Duke says it has the right of eminent domain.
If all goes according to plan, Duke and Dominion Resources will begin construction in 2016, with operations beginning in 2018.
By Nick Cunningham of Oilprice.com