Wednesday, May 9, 2018

Shale Law in the Spotlight: Mariner East Pipeline – An Overview of Status and Current Regulatory Developments

Written by Chloe Marie – Research Fellow

This article is intended to provide an overview of the current status of the Mariner East Pipeline as well as a review of recent regulatory developments related to construction activities on the project.

The Mariner East Pipeline is a two-pipeline repurposing project operated by Sunoco Pipeline LP, a subsidiary of Sunoco Logistics Partners L.P., comprised of the Mariner East Phase I and Phase 2 pipelines to transport Marcellus and Utica shale plays to the Marcus Hook Industrial Complex in southern Delaware County, Pennsylvania.

More specifically, the Mariner East I involved the construction of fifty miles of new pipeline segments that run through western Pennsylvania before forming a connection with existing lines to move ethane and propane from western operations to the Marcus Hook Facility located near Philadelphia and along the Delaware River. Construction of the Mariner East I Pipeline was completed in late 2014 – propane started shipping in December 2014, and ethane shipments began in the first quarter of 2016.

As for the Mariner East II project, it would increase the production capacity of the Mariner East existing mainline system with the construction of two separate pipelines running along the Mariner East I. The two lines would add capacity of approximately 450,000 and 250,000 barrels a day, respectively. The Mariner East II project would be about 350 miles in length and would transport natural gas liquids from Ohio through West Virginia, Pennsylvania, and Delaware to the Marcus Hook Facility. Construction began in September 2016 from Washington County to Delaware County, Pennsylvania, and DEP approved Chapter 105 and Chapter 102 permit application for the project on February 13, 2017.

Mariner East I

On March 7, 2018, the Bureau of Investigation and Enforcement filed a petition with the Pennsylvania Public Utility Commission (PUC) for the issuance of an emergency order over safety issues regarding the Mariner East I Pipeline.

On the same day, the PUC issued such order agreeing that “permitting the continued flow of hazardous liquids through the [Mariner East I] without the proper steps to ensure the integrity of the pipeline could have catastrophic results impacting the public.” The PUC then concluded that the level of risks for the public is higher than that existing for the shippers. Through this order, the PUC requires Sunoco Pipeline LP to suspend its operations and conduct an inspection of the pipeline. In addition, the PUC mandated that Sunoco Pipeline LP halt the transportation of hazardous liquids in the immediate aftermath pending inspection.

On April 27, 2018, Sunoco Pipeline LP requested the PUC to lift the emergency order pointing out that the requirements stipulated in the order were satisfied, including comprehensive testing and analysis of the pipeline integrity, which confirmed that the Mariner East I Pipeline “is fit for reinstatement.”

In a Press Release dated May 3, 2018, the PUC announced that Sunoco Pipeline LP now is authorized to resume operations of the Mariner East I Pipeline acknowledging the corrective work done by Sunoco Pipeline LP. 

Mariner East II

In a Consent Order and Agreement dated February 8, 2018, Pennsylvania DEP temporarily suspended all permitted activities relating to the construction of the Mariner East 2 pipeline project, pending corrective action from Sunoco Pipeline LP, due to the recurrence of environmental infractions and permit violations. In the prior months, Pennsylvania DEP reported many unauthorized horizontal directional drilling (HDD) installation activities or construction methods along the pipeline construction sites and consequently decided that “Sunoco’s unlawful conduct … demonstrates a lack of ability or intention on the part of Sunoco to comply with the Clean Streams Law, the Dam Safety and Encroachments Act, and the permits issued …”

Pennsylvania DEP asked Sunoco Pipeline LP to stabilize the affected areas and implement the revised ‘HDD Inadvertent Return Assessment, Preparedness, Prevention and Contingency Plan.’ In addition, Pennsylvania DEP fined Sunoco Pipeline LP $12,600,000 for the reported violations. On April 27, 2018, Pennsylvania DEP imposed an additional fine of $355,622 to Sunoco Pipeline LP for separate violations.

Further information on the compliance and enforcement actions of Sunoco Pipeline LP’s project is available on the Pennsylvania DEP Mariner East Pipeline II’s webpage.

This material is based upon work supported by the National Agricultural Library, Agricultural Research Service, U.S. Department of Agriculture.

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