Citing low natural gas prices and a slow economy, backers of the Commonwealth pipeline suspended the project. But that does not mean this pipeline, or a variant of it, will not eventually be developed. John J. Sherman, chief executive of Inergy Midstream L.P., told investors, “We still believe that the project is needed, it’s a good project, and it’s just a matter of time before it develops,” Inergy, based in Kansas City, Mo., would have built and operated the pipeline.
News items from The Inquirer, announcing the suspension, and the Daily Local News, covering concerns of local politicians, reinforce the notion that we have not seen the end of Commonwealth’s plan for East Nantmeal.
Property owners approached by land agents for pipeline companies, and faced with the threat of eminent domain, often feel it best to accept the first offer. But in a workshop an attorney with experience in pipeline negotiations advised landowners not to roll over. He suggested that property owners have many rights and plenty of room to get a better price. Considering that the company cannot go lower than the first offer if it comes to an eminent domain hearing, you can take the opening offer as their lowest, not their best.
In northeastern Pennsylvania for the recent MARC1 pipeline, landowners were offered $8 per linear foot. For a 50ft right-of-way that comes to less than $7,000 per acre, suggesting a considerable gap to the average cost to fully purchase the ground. The property owner will still own the land, as the pipeline company is only purchasing an easement to cross the land. However, constraints detailed in the easement may prevent the owner from full enjoyment of use of the property. One may still enjoy mowing and maintaining the eased area and one definitely will still pay taxes on the ground. However there may be restrictions on placing structures or plantings in the eased areas. More important to potential future use, if the pipeline easement separates a significant area of the property, and no drive may be constructed across the pipeline, the owner, depending on local ordinances, may have lost the ability to subdivide and sell a portion of their property. Landowners need to understand what uses of their property may no longer be available to them, and need to be properly compensated for that loss.
The various conservancy groups in the area point out that Pennsylvania’s regulations for remediating an area after constructing a pipeline do not meet best management practices in areas such as soil erosion and forest habitat protection. Property owners can also negotiate conditions to be met during construction and how the land will be restored post-construction that go beyond the state’s requirements. One can specify the types of vegetation to be replanted and the type of long term maintenance by the company to prevent further degradation of the land. Owners viewing themselves as stewards of the land often include these types of conditions. Some have found that the pipeline companies gladly accept these conditions particularly from conservancies, viewing the implementation of the best practices as a public relations opportunity.
After many unofficial suggestions of deferral, the Commonwealth Pipeline website has been update and states the sponsors of the project have suspended its development. Speculation is that the current price for domestic natural gas is too low to support the cost of the 120 mile pipeline.