It took an “Act of Congress” and a decision from the highest court in the land, handed down by the Chief Justice no less, but it’s looking more and more like the Mountain Valley Pipeline (MVP) will be completed sooner rather than later. this year, the opening of 2 Bcf/d of new takeaway capacity for the increasingly pipeline-constrained Appalachian gas supply basin. That has shifted the industry’s gaze to downstream bottlenecks where most of the volumes flowing into the new pipeline will land, at the gates of Williams’ Transco pipeline in southern Virginia. Several midstream expansions have been announced to capture MVP’s natural gas supply influx and move it to downstream markets in the Mid-Atlantic and Southeast regions, and indications are that more will be announced and they will be given the green light in the coming months. These projects will be key to both enabling growth in gas production in the Appalachian Basin and meeting growing demand for gas in premium markets on the other side of the constraints. In today’s RBN blog, we delve into the details and timing of the announced expansion projects competing to increase market access to MVP supply.
In Part 1, we provided the latest developments on MVP, which, along with growing demand for gas-fired generation in the Mid-Atlantic and Southeast, is the impetus for the other midstream projects we’ll dive into today. The biggest news, of course, is that the long-sought-after pipeline looks like it’s finally happening. There are three major events that shifted the odds in the MVP’s favor in recent months, just as it looked like he would languish under the weight of endless legal battles. The first was the Fiscal Responsibility Act of 2023 (FRA), which was signed into law in early June and included a rare congressional mandate to allow and complete MVP. As we detailed in rescue me, the provision stripped the United States Court of Appeals for the Fourth Circuit of jurisdiction, barred any further challenges to state and federal permits, and, for those who wanted to challenge the FRA provision itself, restricted the jurisdiction in the Circuit Court of DC. The second was the Decision of the Supreme Court to grant MVP’s emergency appeal and deny the Fourth Circuit’s decision to stay construction even after the FRA was signed. And finally, the third was the lower court’s decision to dismiss the pending petitions against MVP because the FRA removed its jurisdiction to hear them.
There is still some risk to the MVP completion and schedule. For one thing, there’s a lingering eminent domain case in the DC circuit that could yet throw a wrench in the project’s gears. Separately, the Pipeline and Hazardous Materials Safety Administration (PHMSA) issued a Notice of Proposed Safety Order (NOPSO) to Equitrans on Aug. 11 related to concerns that years of construction delays could have affected the integrity of the pipeline. The resulting inspections, potential remediation and third-party testing related to this order could delay completion, as could extreme weather if construction extends into the winter months. But barring major setbacks related to these risks, the odds have shifted in favor of MVP completion for the first time in a long time, and we could see the pipeline come online late this year or early 2024 .
