Sunoco Logistics plan encounters delay
Company needs more time to complete permit process
Sunoco Logistics Partners has asked the Pennsylvania Department of Environmental Protection for a one-month extension to respond to identified issues with its Mariner East 2 pipeline application package.
“Basically, we asked for an extension from Nov. 7 to Dec. 7 to complete our response to the DEP as part of the permitting process,” said company spokesman Jeffrey Shields Friday. “There’s a lot of detail and we want to make sure that we get all their requests answered.”
Shields said the request would likely push back the completion and start-up date for the 350mile pipeline from mid-2017 to the third quarter of 2017.
The Mariner East 2 would cross 17 counties in the state to transport natural gas liquids including propane, ethane and butane from Ohio, West Virginia and western Pennsylvania to the Marcus Hook Industrial Complex for processing and transport overseas.
The $2.5 billion project, which includes 11.4 miles of pipeline running through Edgmont, Middletown, Aston and Upper Chichester, also has several delivery points in the lower half of the state. An initial 20-inch pipeline would deliver approximately 275,000 barrels per day but could ramp up to 450,000 barrels, according to Sunoco. An optional secondary 16-inch pipeline could also deliver an additional 250,000 barrels per day.
The project has received sig-
nificant pushback from residents across Pennsylvania and spurred multiple lawsuits to halt construction. The DEP further hindered the proposal when it pointed to hundreds of issues in Sunoco’s permitting applications in September.
In a 21-page document for the Delaware County portion of the plan posted to the DEP website Sept. 6, Dams and Waterways Chief John Hohenstein identified issues with erosion plans, stream crossings and missing or mislabeled technical information that will need to be corrected before permits can be issued.
Sunoco Logistics President and Chief Executive Mike Hennigan cited these permitting issues and a “significant deviation” from the original timing of the project during an investor call for third-quarter earnings Thursday.
“The detail involved in the PA DEP permit application has necessitated a longer-than-anticipated regulatory review process, but we are convinced that this project will be environmentally responsible and will be creating significant economic development in the commonwealth,” he said, according to a transcript of the call provided by industry website seekingalpha. com.
“We remain optimistic and look forward to the next phase of the project where approximately 10,000 construction jobs will be implemented,” Hennigan continued. “We believe this project is the largest investment in the Commonwealth of Pennsylvania to date, creating family-sustaining jobs and economic development, and a mechanism to move Pennsylvania natural resources throughout the state.”
Marcus Hook-based Braskem America, the North American branch of a major Brazilian petrochemical company, recently decided to expand operations at its plant in La Porte, Texas, over its Delaware County facility, citing a lack of local infrastructure. “We’ve been saying for a long time that pipeline infrastructure is critical to the growth of the economy in southwest Pennsylvania and we think these projects are the cataclysm for the economy to grow,” said Shields.
He did not offer an opinion on whether the recent presidential election would also boost infrastructure development, though the Dow Jones soared to a record high last week, signaling industry in general is bullish on Donald Trump’s incoming administration.
Philadelphia-based Econsult Solutions, Inc. conducted a study for Sunoco last year that found the Mariner East project is expected to add up to $4.2 billion to the state’s economy, supporting more than 30,000 direct and indirect jobs during construction and 300 to 400 permanent jobs once completed.
Still, groups opposed to the pipeline’s construction have concerns about environmental stewardship and personal safety.
“We’re just waiting for a disaster to happen,” said Alex Bomstein, a senior attorney with the Clean Air Counsel. “It’s really just a matter of when.”
A Reuters analysis of government data in September showed Sunoco tops the list of U.S. crude oil spills with 200 leaks since 2010, though most of those were at facilities and therefore easily contained.
The CAC is one of the groups fighting the Mariner East project in federal court, where it claims Sunoco is attempting to shoehorn the new pipeline into longstanding easements granted across the state for unrelated projects.
Some residents of Middletown recently accused Sunoco of using those easements to bully municipalities into approving new construction ordinances to lay pipe. Bomstein noted the township nonetheless agreed to allow the pipeline to run within 1,000 feet of an elementary school.
He also pointed to two recent spills in Pennsylvania to underline his concerns, noting one required evacuating a five-mile area in Cambria and the other dumped 55,000 gallons of gasoline into a tributary of the Susquehanna River.
“As the DEP is considering water permits for the pipeline, that should be present in their minds,” Bomstein said.
These new storage tanks at the Marcus Hook Industrial Complex could store more than 2 million barrels of natural gas liquids when the Mariner East 2 pipeline is complete.
The Marine East 2 pipeline would carry ethane, butane and propane from the Marcellus Shale portion of Pennsylvania to the old Sunoco refinery in Marcus Hook. The plan is being heralded as part of a push to make the Marcus Hook Industrial Complex the energy hub of the entire Northeast, but has encountered vociferous community opposition.